TJ Maxx 2009 Annual Report Download - page 39

— During fiscal 2010, we repurchased 27.0 million shares of our common stock for $950 million. This year’s
repurchases included the use of the $375 million proceeds from our April 2009 debt offering to repurchase a
majority of the 15.1 million shares issued upon conversion of our zero coupon convertible subordinated notes
called for redemption. Diluted earnings per share reflect the benefit of the stock repurchase program.
— Consolidated average per store inventories from our continuing operations, including inventory on hand at our
distribution centers, were down 10% at the end of fiscal 2010 over the prior year end as compared to a decrease of
6% at the end of fiscal 2009 over the prior year end.
The following is a discussion of our consolidated operating results, followed by a discussion of our segment
operating results:
Net sales: Consolidated net sales for fiscal 2010 totaled $20.3 billion, a 7% increase over net sales of $19.0 billion in
fiscal 2009. The increase reflected a 6% increase from same store sales and a 4% increase from new stores, offset by a 2%
decline from the negative impact of foreign currency exchange rates and a 1% decrease from the 53
rd
week in fiscal 2009.
Consolidated net sales for fiscal 2009 increased 4% over net sales of $18.3 billion for fiscal 2008. The increase reflected a
4% increase from new stores, a 1% increase from the 53
rd
week in fiscal 2009 and a 1% increase in same store sales, offset
bya2%declinefromthenegativeimpactofforeigncurrencyexchangerates.
New stores have been a significant source of sales growth. Both our consolidated store count and our selling square
footage increased by 3% in fiscal 2010 as compared to fiscal 2009. Both our consolidated store count and our selling
square footage increased by 5% in fiscal 2009 over the prior fiscal year. We expect to add 130 stores (net of store closings)
in fiscal 2011, a 5% increase in both our consolidated store base and our selling square footage.
The 6% same store sales increase in fiscal 2010 was driven by significant increases in customer traffic at all of our
businesses, partially offset by a decline in the value of the average transaction. The increase in customer traffic accelerated
during the course of the year. Juniors, dresses, children’s apparel, footwear, accessories and home fashions performed
particularly well in fiscal 2010. Geographically, same store sales increases in Europe and Canada trailed the consolidated
average. In the U.S., sales were strong throughout the country with the Midwest, Southeast and West Coast above the
average, and New England and Florida below the average.
The 1% same store sales increase in fiscal 2009 reflected a strong first half performance, especially at our
international segments, partially offset by same store sales decreases in the second half of the year largely due to the
economic recession. Customer traffic increased at virtually all of our businesses in fiscal 2009, even in the third and
fourth quarters, but was partially offset by a reduction in the value of the average transaction. As for merchandise
categories, footwear, accessories and dresses were the strongest performers, while home fashions were adversely affected
by the weak housing market and economic conditions. Geographically, same store sales in Canada and Europe were
above the consolidated average for fiscal 2009, while in the U.S., same store sales in the West Coast and Florida trailed
the consolidated average.
We define same store sales to be sales of those stores that have been in operation for all or a portion of two
consecutive fiscal years, or in other words, stores that are starting their third fiscal year of operation. We classify a store as a
new store until it meets the same store sales criteria. We determine which stores are included in the same store sales
calculation at the beginning of a fiscal year and the classification remains constant throughout that year, unless a store is
closed. We calculate same store sales results by comparing the current and prior year weekly periods that are most closely
aligned. Relocated stores and stores that have increased in sizearegenerallyclassifiedinthesamewayastheoriginalstore,
and we believe that the impact of these stores on the consolidated same store percentage is immaterial. Same store sales of
our foreign divisions are calculated on a constant currency basis, meaning we translate the current year’s same store sales
of our foreign divisions at the same exchange rates used in the prior year. This removes the effect of changes in currency
exchange rates, which we believe is a more accurate measure of divisional operating performance.
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