What changed in this filing

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Item 1. Financial Statements

2021-08-27 compared with 2021-05-28 · 200 added, 120 removed, 447 unchanged (42% of the section changed)

3 unchanged sentences

IN THOUSANDS EXCEPT PER SHARE AMOUNTS

Thirteen Weeks Ended

Thirteen Weeks Ended Twenty-Six Weeks Ended

2021 August 1,

2020 July 31,

2021 August 1,

Net sales $ 12,077,063 $ 6,667,575 $ 22,163,724 $ 11,076,463

1 unchanged sentence

Selling, general and administrative expenses 2,223,692 1,527,768 4,288,684 2,841,688

Loss on early extinguishment of debt 242,248 — 242,248 —

Interest expense, net 28,661 57,336 73,349 80,687

13 unchanged sentences

Thirteen Weeks Ended

2021 August 1,

Net income (loss) $ 785,681 $ ( 214,220 )

Additions to other comprehensive income:

Foreign currency translation adjustments, net of related tax benefit of $ 1,140 in fiscal 2022 and tax provisions of $ 5,462 in fiscal 2021

( 876 ) 69,378

Reclassifications from other comprehensive income (loss) to net income (loss):

Amortization of prior service cost and deferred gains/losses, net of related tax provisions of $ 1,590 in fiscal 2022 and $ 1,746 in fiscal 2021

Amortization of loss on cash flow hedge, net of related tax provision of $ 76 in fiscal 2021

Other comprehensive income, net of tax 3,492 74,383

Total comprehensive income (loss) $ 789,173 $ ( 139,837 )

Twenty-Six Weeks Ended

2021 August 1,

Net income (loss) $ 1,319,611 $ ( 1,101,709 )

Additions to other comprehensive income (loss):

3 unchanged sentences

Amortization of prior service cost and deferred gains/losses, net of related tax provisions of $ 2,646 in fiscal 2022 and $ 3,492 in fiscal 2021

Amortization of loss on cash flow hedge, net of related tax provisions of $ 603 in fiscal 2022 and $ 76 in fiscal 2021

Amortization of loss on cash flow hedge, net of related tax provision of $ 603 in fiscal 2022 and $ 152 in fiscal 2021

Other comprehensive income (loss), net of tax 28,379 ( 49,770 )

5 unchanged sentences

2021 January 30,

2021 August 1,

Current assets:

36 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS

Thirteen Weeks Ended

Twenty-Six Weeks Ended

2021 August 1,

Cash flows from operating activities:

Net income (loss) $ 1,319,611 $ ( 1,101,709 )

Adjustments to reconcile net income (loss) to cash used in operating activities:

Adjustments to reconcile net income (loss) to cash provided by operating activities:

Depreciation and amortization 430,561 439,525

Loss on early extinguishment of debt 242,248 —

Loss on property disposals and impairment charges 482 38,970

2 unchanged sentences

Changes in assets and liabilities:

(Increase) decrease in accounts receivable ( 156,999 ) 210,419

(Increase) in merchandise inventories ( 750,553 ) ( 136,027 )

(Increase) in accounts receivable ( 154,350 ) ( 56,041 )

(Increase) decrease in merchandise inventories ( 733,035 ) 1,111,612

(Increase) in income taxes recoverable ( 85,441 ) ( 258,655 )

1 unchanged sentence

(Decrease) in accounts payable ( 425,274 ) ( 240,356 )

Increase (decrease) in accrued expenses and other liabilities 12,214 ( 578,178 )

Increase (decrease) in income taxes payable 203,740 ( 13,290 )

Increase in accrued expenses and other liabilities 468,039 153,502

(Decrease) in income taxes payable ( 34,819 ) ( 25,254 )

(Decrease) increase in net operating lease liabilities ( 96,648 ) 209,071

Other, net ( 79,096 ) 27,057

Net cash (used in) operating activities ( 432,727 ) ( 3,160,483 )

Net cash provided by operating activities 946,879 196,775

Cash flows from investing activities:

25 unchanged sentences

Earnings Total

Balance, January 30, 2021 1,204,698 $ 1,204,698 $ 260,515 $ ( 606,071 ) $ 4,973,542 $ 5,832,684

Balance, May 1, 2021 1,206,387 $ 1,206,387 $ 321,475 $ ( 581,184 ) $ 5,192,536 $ 6,139,214

Net income — — — — 785,681 785,681

3 unchanged sentences

Issuance of common stock under Stock Incentive Plan, net of shares used to pay tax withholdings 1,105 1,105 25,131 — ( 347 ) 25,889

Balance, May 1, 2021 1,206,387 $ 1,206,387 $ 321,475 $ ( 581,184 ) $ 5,192,536 $ 6,139,214

Common stock repurchased ( 4,511 ) ( 4,511 ) ( 292,588 ) — — ( 297,099 )

Balance, July 31, 2021 1,202,981 $ 1,202,981 $ 117,603 $ ( 577,692 ) $ 5,663,492 $ 6,406,384

Thirteen Weeks Ended

4 unchanged sentences

Earnings Total

Balance, May 2, 2020 1,197,877 $ 1,197,877 $ 8,104 $ ( 797,324 ) $ 4,330,561 $ 4,739,218

Net (loss) — — — — ( 214,220 ) ( 214,220 )

Other comprehensive income, net of tax — — — 74,383 — 74,383

Recognition of share-based compensation — — 39,178 — — 39,178

Issuance of common stock under Stock Incentive Plan, net of shares used to pay tax withholdings 1,184 1,184 21,250 — ( 424 ) 22,010

Balance, August 1, 2020 1,199,061 $ 1,199,061 $ 68,532 $ ( 722,941 ) $ 4,115,917 $ 4,660,569

The accompanying notes are an integral part of the unaudited consolidated financial statements.

THE TJX COMPANIES, INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

Twenty-Six Weeks Ended

Shares Par Value

Additional Paid-In

Capital Accumulated Other Comprehensive

Loss Retained

Earnings Total

Balance, January 30, 2021 1,204,698 $ 1,204,698 $ 260,515 $ ( 606,071 ) $ 4,973,542 $ 5,832,684

Net income — — — — 1,319,611 1,319,611

Other comprehensive income, net of tax — — — 28,379 — 28,379

Cash dividends declared on common stock — — — — ( 629,314 ) ( 629,314 )

Recognition of share-based compensation — — 114,121 — — 114,121

Issuance of common stock under Stock Incentive Plan, net of shares used to pay tax withholdings 2,794 2,794 35,555 — ( 347 ) 38,002

Common stock repurchased ( 4,511 ) ( 4,511 ) ( 292,588 ) — — ( 297,099 )

Balance, July 31, 2021 1,202,981 $ 1,202,981 $ 117,603 $ ( 577,692 ) $ 5,663,492 $ 6,406,384

Twenty-Six Weeks Ended

Shares Par Value

Additional Paid-In

Capital Accumulated Other Comprehensive

Loss Retained

Earnings Total

Balance February 1, 2020 1,199,100 $ 1,199,100 $ — $ ( 673,171 ) $ 5,422,283 $ 5,948,212

3 unchanged sentences

Issuance of common stock under Stock Incentive Plan, net of shares used to pay tax withholdings 3,348 3,348 34,765 — ( 424 ) 37,689

Common stock repurchased and retired ( 3,387 ) ( 3,387 ) ( 25,715 ) — ( 172,398 ) ( 201,500 )

Balance, May 2, 2020 1,197,877 $ 1,197,877 $ 8,104 $ ( 797,324 ) $ 4,330,561 $ 4,739,218

Common stock repurchased ( 3,387 ) ( 3,387 ) ( 25,715 ) — ( 172,398 ) ( 201,500 )

Balance, August 1, 2020 1,199,061 $ 1,199,061 $ 68,532 $ ( 722,941 ) $ 4,115,917 $ 4,660,569

The accompanying notes are an integral part of the unaudited consolidated financial statements.

12 unchanged sentences

COVID-19 Pandemic

The novel coronavirus disease (“COVID-19”), was first identified in December 2019 before spreading worldwide.

The novel coronavirus disease (“COVID-19”) was identified in December 2019 before spreading worldwide.

The Company has been, and may continue to be, impacted by the COVID-19 pandemic.

1 unchanged sentence

The COVID-19 pandemic is complex and rapidly evolving and the severity and duration of the pandemic is still unknown.

Additionally, the resurgence or the emergence of new variants has caused and may continue to cause intermittent or prolonged periods of temporary store closures, and could elicit further actions and recommendations from governments and public health authorities that could impact our operations.

In the first quarter of fiscal 2021, the Company temporarily closed all of its stores, distribution centers and offices, and online businesses until the second quarter of fiscal 2021, while during the first quarter of fiscal 2022, our stores in the United States remained open for the entire first quarter, and we had (and continue to have) store closures primarily in Europe and Canada.

Additionally, its resurgence or the emergence of new variants has caused and may continue to cause intermittent or prolonged periods of temporary store closures, and stringent occupancy restrictions while stores are open, and could elicit further actions and recommendations from governments and public health authorities that could impact our operations.

In the first quarter of fiscal 2021, the Company temporarily closed all of its stores, distribution centers and offices, and online businesses until the second quarter of fiscal 2021.

During the first six months of fiscal 2022, while the Company’s stores in the United States remained open for the entire period, the Company had temporary store closures, in Europe, Canada and Australia.

The Company continues to monitor developments, including government requirements and recommendations at the national, state, and local level that could result in possible additional impacts to our operations.

13 unchanged sentences

The following table presents deferred gift card revenue activity:

In thousands May 1,

In thousands July 31,

2021 August 1,

Balance, beginning of year $ 576,187 $ 500,844

3 unchanged sentences

Balance, end of period $ 546,004 $ 476,605

The increase in both deferred revenue and revenue recognized versus the prior year reflects the impact of the temporary store and e-commerce closures in the first quarter of fiscal 2021 due to the COVID-19 pandemic.

TJX recognized $ 436.3 million in gift card revenue for the three months ended July 31, 2021 and $ 198.7 million in gift card revenue for the three months ended August 1, 2020.

The increase in both deferred revenue and revenue recognized versus the prior year reflects the impact of the temporary store closures in the first half of fiscal 2021 due to the COVID-19 pandemic.

Gift cards are combined in one homogeneous pool and are not separately identifiable.

As such, the revenue recognized consists of gift cards that were part of the deferred revenue balance at the beginning of the period as well as gift cards that were issued during the period.

Supplemental cash flow information related to leases for the thirteen weeks ended May 1, 2021 and May 2, 2020 is as follows:

Thirteen Weeks Ended

In thousands May 1,

Supplemental cash flow information related to leases for the twenty-six weeks ended July 31, 2021 and August 1, 2020 is as follows:

Twenty-Six Weeks Ended

In thousands July 31,

2021 August 1,

Operating cash flows paid for operating leases $ 1,061,163 $ 762,823

4 unchanged sentences

Updates to the FASB Accounting Standards Codification are communicated through issuance of an Accounting Standards Update (“ASU”).

Unless otherwise discussed, the Company has reviewed the guidance and have determined that they will not apply or are not expected to be material to its Consolidated Financial Statements upon adoption and therefore are not disclosed.

The Company has reviewed the new guidance and has determined that they will either not apply to TJX or they are not expected to be material to its Consolidated Financial Statements upon adoption and therefore they are not disclosed.

Property at Cost

The following table presents the components of property at cost:

In thousands May 1,

In thousands July 31,

2021 January 30,

2021 August 1,

Land and buildings

7 unchanged sentences

Net property at cost $ 5,107,346 $ 5,036,096 $ 5,100,411

Depreciation expense was $ 212 million for the three months ended May 1, 2021 and $ 217 million for the three months ended May 2, 2020.

Depreciation expense was $ 213 million for the three months ended July 31, 2021 and $ 217 million for the three months ended August 1, 2020.

Depreciation expense was $ 425 million for the six months ended July 31, 2021 and $ 434 million for the six months ended August 1, 2020.

Non-cash investing activities include the change in accrued capital additions of $ 37 million and $( 92 ) million as of the periods ended July 31, 2021 and August 1, 2020, respectively.

Accumulated Other Comprehensive (Loss) Income

Amounts included in accumulated other comprehensive loss are recorded net of taxes.

The following table details the changes in accumulated other comprehensive loss for the twelve months ended January 30, 2021 and the three months ended May 1, 2021:

The following table details the changes in accumulated other comprehensive loss for the twelve months ended January 30, 2021 and the six months ended July 31, 2021:

In thousands Foreign

24 unchanged sentences

— 7,269 — 7,269

Balance, May 1, 2021

Balance, July 31, 2021

$ ( 420,159 ) $ ( 157,533 ) $ — $ ( 577,692 )

1 unchanged sentence

Capital Stock

During the second quarter of fiscal 2022, the Company lifted the temporary suspension of its previously authorized stock repurchase programs.

TJX repurchased and retired 4.6 million shares of its common stock at a cost of approximately $ 300 million during the quarter and six months ended July 31, 2021, on a “trade date” basis.

Prior to the suspension of the Company’s share repurchase program, during the first quarter of fiscal 2021, TJX repurchased and retired 3.2 million shares of its common stock at a cost of $ 190 million on a “trade date” basis, and no shares were repurchased during the second quarter of fiscal 2021 through the first quarter of fiscal 2022.

TJX reflects stock repurchases in its financial statements on a “settlement date” or cash basis.

TJX had cash expenditures under repurchase programs of $ 201 million for the three months ended May 2, 2020.

TJX had cash expenditures under repurchase programs of $ 297 million for the six months ended July 31, 2021 and $ 201 million for the six months ended August 1, 2020.

These expenditures were funded by cash generated from operations.

In February 2020, the Company announced that its Board of Directors had approved, in January 2020, a new stock repurchase program that authorizes the repurchase of up to an additional $ 1.5 billion of TJX common stock from time to time.

In February 2019, TJX announced that its Board of Directors had approved an additional stock repurchase program that authorized the repurchase of up to $ 1.5 billion of TJX common stock from time to time.

As of May 1, 2021, TJX had approximately $ 3.0 billion available under these previously announced stock repurchase programs.

Also, in February 2019, TJX announced that its Board of Directors had approved a stock repurchase program that authorized the repurchase of up to $ 1.5 billion of TJX common stock from time to time.

As of July 31, 2021, TJX had approximately $ 2.7 billion available under these previously announced stock repurchase programs.

All shares repurchased under the stock repurchase programs have been retired.

Subsequent to the end of the first quarter of fiscal 2022, the Company lifted the temporary suspension of its previously authorized stock repurchase programs.

Earnings (Loss) Per Share

The following table presents the calculation of basic and diluted earnings (loss) per share for net income (loss):

Thirteen Weeks Ended

Amounts in thousands, expect per share amounts May 1,

Thirteen Weeks Ended Twenty-Six Weeks Ended

Amounts in thousands, expect per share amounts July 31,

2021 August 1,

2020 July 31,

2021 August 1,

Basic earnings (loss) per share:

18 unchanged sentences

Such options are excluded because they would have an antidilutive effect.

There were no such options excluded for the thirteen weeks ended May 1, 2021.

For the period ended May 2, 2020, as a result of the net loss for the quarter, all options were antidilutive and therefore have been excluded from the calculation.

The Board of Directors declared a quarterly dividend of $ 0.26 per share in the first quarter of fiscal 2022.

There were no such options excluded for the thirteen weeks and twenty-six weeks ended July 31, 2021.

For the thirteen weeks and twenty-six weeks ended August 1, 2020, as a result of the net losses, all options were antidilutive and therefore have been excluded from the calculation.

The Board of Directors declared a quarterly dividend of $ 0.26 per share in the second quarter of fiscal 2022.

Financial Instruments

6 unchanged sentences

Changes to the fair value of derivative contracts that do not qualify for hedge accounting are reported in earnings in the period of the change.

For derivatives that qualify for hedge accounting, changes in the fair value of the derivatives are either recorded in shareholders’ equity as a component of other comprehensive (loss) income or are recognized currently in earnings, along with an offsetting adjustment against the basis of the item being hedged.

For derivatives that qualify for hedge accounting, changes in the fair value of the derivatives are either recorded in shareholders’ equity as a component of accumulated other comprehensive (loss) or are recognized currently in earnings, along with an offsetting adjustment against the basis of the item being hedged.

Diesel Fuel Contracts

2 unchanged sentences

The hedge agreements are designed to mitigate the volatility of diesel fuel pricing (and the resulting per mile surcharges payable by TJX) by setting a fixed price per gallon for the period being hedged.

During fiscal 2021, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for fiscal 2022, and during the first three months of fiscal 2022, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for the first three months of fiscal 2023.

The hedge agreements outstanding at May 1, 2021 relate to approximately 48 % of TJX’s estimated notional diesel requirements for the remainder of fiscal 2022 and approximately 40 % of TJX’s estimated notional diesel requirements for the first three months of fiscal 2023.

These diesel fuel hedge agreements will settle throughout the remainder of fiscal 2022 and throughout the first four months of fiscal 2023.

During fiscal 2021, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for fiscal 2022, and during the first six months of fiscal 2022, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for the first six months of fiscal 2023.

The hedge agreements outstanding at July 31, 2021 relate to approximately 47 % of TJX’s estimated notional diesel requirements for the remainder of fiscal 2022 and approximately 50 % of TJX’s estimated notional diesel requirements for the first six months of fiscal 2023.

These diesel fuel hedge agreements will settle throughout the remainder of fiscal 2022 and throughout the first seven months of fiscal 2023.

TJX elected not to apply hedge accounting to these contracts.

1 unchanged sentence

TJX enters into forward foreign currency exchange contracts to obtain economic hedges on portions of merchandise purchases made and anticipated to be made by the Company’s operations in currencies other than their respective functional currencies.

As a result of the COVID-19 pandemic, there was a significant change in the Company's anticipated merchandise purchases during the first quarter of fiscal 2021 and the Company early settled derivative contracts designed to hedge merchandise purchases that would no longer take place.

The settlement of these contracts resulted in a net gain of $ 25 million in the first quarter of fiscal 2021.

The contracts outstanding at May 1, 2021 cover the merchandise purchases the Company is committed to over the next several months.

The contracts outstanding at July 31, 2021 cover the merchandise purchases the Company is committed to over the next several months.

Additionally, TJX’s operations in Europe are subject to foreign currency exposure as a result of their buying function being centralized in the U.K.

2 unchanged sentences

This intercompany billing to TJX’s European businesses’ Euro denominated operations creates exposure to the central buying entity for changes in the exchange rate between the Euro and British Pound.

The inflow of Euros to the central buying entity provides a natural hedge for merchandise purchased from third-party vendors that is denominated in Euros.

A portion of the inflows of Euros to the central buying entity provides a natural hedge for merchandise purchased from third-party vendors that is denominated in Euros.

TJX calculates any excess Euro exposure each month and enters into forward contracts of approximately 30 days' duration to mitigate this exposure.

TJX also enters into derivative contracts, generally designated as fair value hedges, to hedge intercompany debt and intercompany interest payable.

TJX also enters into derivative contracts, generally designated as fair value hedges, to hedge intercompany debt.

The changes in fair value of these contracts are recorded in selling, general and administrative expenses and are offset by marking the underlying item to fair value in the same period.

Upon settlement, the realized gains and losses on these contracts are offset by the realized gains and losses of the underlying item in selling, general and administrative expenses.

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at May 1, 2021:

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at July 31, 2021:

In thousands Pay Receive Blended

4 unchanged sentences

Fair value hedges:

Intercompany balances, primarily debt and related interest:

Intercompany balances, primarily debt related:

zł 45,000 £ 8,846 0.1966 Prepaid Exp $ 562 $ — $ 562

A$ 80,000 U.S.$ 62,032 0.7754 (Accrued Exp) — ( 98 ) ( 98 )

A$ 110,000 U.S.$ 84,198 0.7654 Prepaid Exp 3,100 — 3,100

U.S.$ 75,102 £ 55,000 0.7323 Prepaid Exp 1,351 — 1,351

£ 250,000 U.S.$ 346,344 1.3854 Prepaid Exp / (Accrued Exp) 426 ( 1,504 ) ( 1,078 )

€ 200,000 U.S.$ 244,699 1.2235 Prepaid Exp 2,301 — 2,301

€ 170,000 U.S.$ 207,623 1.2213 Prepaid Exp / (Accrued Exp) 5,169 ( 143 ) 5,026

C$ 150,000 U.S.$ 124,009 0.8267 Prepaid Exp 3,698 — 3,698

Economic hedges for which hedge accounting was not elected:

6 unchanged sentences

Intercompany billings in TJX International, primarily merchandise related:

€ 163,000 £ 141,240 0.8665 (Accrued Exp) — ( 166 ) ( 166 )

€ 98,000 £ 84,053 0.8577 Prepaid Exp 343 — 343

Merchandise purchase commitments:

C$ 574,390 U.S.$ 457,000 0.7956 (Accrued Exp) — ( 11,054 ) ( 11,054 )

C$ 29,455 € 19,500 0.6620 (Accrued Exp) — ( 444 ) ( 444 )

C$ 630,947 U.S.$ 512,000 0.8115 Prepaid Exp / (Accrued Exp) 7,066 ( 1,132 ) 5,934

C$ 34,928 € 23,500 0.6728 Prepaid Exp / (Accrued Exp) 93 ( 161 ) ( 68 )

£ 396,740 U.S.$ 555,900 1.4012 Prepaid Exp / (Accrued Exp) 5,202 ( 678 ) 4,524

A$ 52,396 U.S.$ 39,225 0.7486 Prepaid Exp / (Accrued Exp) 656 ( 36 ) 620

U.S.$ 53,680 € 44,400 0.8271 Prepaid Exp / (Accrued Exp) 185 ( 267 ) ( 82 )

zł 400,100 £ 75,659 0.1891 Prepaid Exp / (Accrued Exp) 961 ( 126 ) 835

U.S.$ 55,198 € 45,000 0.8152 (Accrued Exp) — ( 1,713 ) ( 1,713 )

Total fair value of derivative financial instruments $ 50,432 $ ( 5,492 ) $ 44,940

6 unchanged sentences

Fair value hedges:

Intercompany balances, primarily debt and related interest:

Intercompany balances, primarily debt related:

zł 45,000 £ 8,846 0.1966 Prepaid Exp $ 11 $ — $ 11

17 unchanged sentences

Total fair value of derivative financial instruments $ 9,029 $ ( 21,921 ) $ ( 12,892 )

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at May 2, 2020:

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at August 1, 2020:

In thousands Pay Receive Blended

4 unchanged sentences

Fair value hedges:

Intercompany balances, primarily debt and related interest:

zł 65,000 £ 12,780 0.1966 Prepaid Exp $ 351 $ — $ 351

€ 60,000 £ 53,412 0.8902 Prepaid Exp 437 — 437

A$ 110,000 U.S.$ 70,802 0.6437 Prepaid Exp / (Accrued Exp) 1,788 ( 1,656 ) 132

Intercompany balances, primarily debt related:

zł 65,000 £ 12,780 0.1966 (Accrued Exp) $ — $ ( 628 ) $ ( 628 )

€ 60,000 £ 53,412 0.8902 (Accrued Exp) — ( 1,033 ) ( 1,033 )

A$ 110,000 U.S.$ 70,802 0.6437 (Accrued Exp) — ( 7,798 ) ( 7,798 )

U.S.$ 72,475 £ 55,000 0.7589 (Accrued Exp) — ( 448 ) ( 448 )

£ 200,000 U.S.$ 249,499 1.2475 Prepaid Exp / (Accrued Exp) 999 ( 2,332 ) ( 1,333 )

C$ 350,000 U.S.$ 248,821 0.7109 Prepaid Exp / (Accrued Exp) 640 ( 478 ) 162

£ 200,000 U.S.$ 249,499 1.2475 (Accrued Exp) — ( 12,538 ) ( 12,538 )

C$ 550,000 U.S.$ 390,766 0.7105 (Accrued Exp) — ( 19,571 ) ( 19,571 )

Economic hedges for which hedge accounting was not elected:

8 unchanged sentences

Merchandise purchase commitments:

C$ 77,979 U.S.$ 59,200 0.7592 Prepaid Exp 3,819 — 3,819

£ 63,618 U.S.$ 82,200 1.2921 Prepaid Exp 2,469 — 2,469

A$ 17,438 U.S.$ 11,780 0.6755 Prepaid Exp 578 — 578

zł 69,400 £ 13,880 0.2000 Prepaid Exp 666 — 666

C$ 271,576 U.S.$ 201,700 0.7427 Prepaid Exp / (Accrued Exp) 737 ( 1,647 ) ( 910 )

£ 240,694 U.S.$ 304,800 1.2663 Prepaid Exp / (Accrued Exp) 34 ( 10,415 ) ( 10,381 )

A$ 40,156 U.S.$ 28,250 0.7035 (Accrued Exp) — ( 447 ) ( 447 )

zł 87,000 £ 18,059 0.2076 Prepaid Exp 419 — 419

U.S.$ 3,771 € 3,383 0.8971 Prepaid Exp 213 — 213

Total fair value of derivative financial instruments $ 1,403 $ ( 69,015 ) $ ( 67,612 )

Presented below is the impact of derivative financial instruments on the Consolidated Statements of Income (Loss) for the periods shown:

Amount of (Loss) Gain Recognized

Amount of Gain (Loss) Recognized

in Income / (Loss) by Derivative

1 unchanged sentence

Recognized in Income / (Loss) by

Thirteen Weeks Ended

In thousands May 1,

Thirteen Weeks Ended Twenty-Six Weeks Ended

In thousands July 31,

2021 August 1,

2020 July 31,

2021 August 1,

Fair value hedges:

Intercompany balances, primarily debt and related interest Selling, general and administrative expenses $ ( 2,864 ) $ ( 5,173 )

Intercompany balances, primarily debt related Selling, general and administrative expenses $ 15,417 $ ( 38,060 ) $ 12,553 $ ( 43,233 )

Economic hedges for which hedge accounting was not elected:

2 unchanged sentences

Merchandise purchase commitments Cost of sales, including buying and occupancy costs 11,710 ( 15,808 ) ( 4,259 ) 34,327

(Loss) gain recognized in income / (loss) $ ( 5,145 ) $ 20,256

Gain (loss) recognized in income / (loss) $ 37,830 $ ( 45,784 ) $ 32,685 $ ( 25,528 )

Fair Value Measurements

4 unchanged sentences

The following table sets forth TJX’s financial assets and liabilities that are accounted for at fair value on a recurring basis:

In thousands May 1,

In thousands July 31,

2021 January 30,

2021 August 1,

Executive Savings Plan investments $ 394,078 $ 363,729 $ 324,270

10 unchanged sentences

These inputs are considered to be Level 2.

The fair value of long-term debt as of May 1, 2021 was $ 5.8 billion compared to a carrying value of $ 5.3 billion.

The fair value of long-term debt as of July 31, 2021 was $ 3.7 billion compared to a carrying value of $ 3.4 billion.

The fair value of long-term debt as of January 30, 2021 was $ 5.9 billion compared to a carrying value of $ 5.3 billion.

The fair value of the current portion of long-term debt as of January 30, 2021 was $ 754 million compared to a carrying value of $ 750 million.

The fair value of long-term debt as of May 2, 2020 was $ 7.8 billion compared to a carrying value of $ 7.2 billion.

The fair value of long-term debt as of August 1, 2020 was $ 6.4 billion compared to a carrying value of $ 5.4 billion.

These estimates do not necessarily reflect provisions or restrictions in the various debt agreements that might affect TJX’s ability to settle these obligations.

TJX’s cash equivalents are stated at cost, which approximates fair value due to the short maturities of these instruments.

Certain assets and liabilities are measured at fair value on a nonrecurring basis, where as the assets and liabilities are not measured at fair value on an ongoing basis, but are subject to fair value adjustments in certain circumstances, such as when there is evidence of an impairment.

For the periods ended May 1, 2021, January 30, 2021 and May 2, 2020, the Company did not record any material impairments to long-lived assets.

Certain assets and liabilities are measured at fair value on a nonrecurring basis, whereas the majority of assets and liabilities are not measured at fair value on an ongoing basis, but are subject to fair value adjustments in certain circumstances, such as when there is evidence of an impairment.

For the periods ended July 31, 2021, January 30, 2021 and August 1, 2020, the Company did not record any material impairments to long-lived assets.

Segment Information

13 unchanged sentences

Presented below is financial information with respect to TJX’s business segments:

Thirteen Weeks Ended

In thousands May 1,

Thirteen Weeks Ended Twenty-Six Weeks Ended

In thousands July 31,

2021 August 1,

2020 July 31,

2021 August 1,

In the United States:

12 unchanged sentences

General corporate expense 163,602 123,433 324,044 223,760

Loss on early extinguishment of debt 242,248 — 242,248 —

Interest expense, net 28,661 57,336 73,349 80,687

4 unchanged sentences

Thirteen Weeks Ended Thirteen Weeks Ended

In thousands May 1,

In thousands July 31,

2021 August 1,

2020 July 31,

2021 August 1,

Service cost $ 12,718 $ 12,540 $ 755 $ 709

3 unchanged sentences

Total expense $ 6,611 $ 8,326 $ 2,690 $ 2,544

Funded Plan Unfunded Plan

Twenty-Six Weeks Ended Twenty-Six Weeks Ended

In thousands July 31,

2021 August 1,

2020 July 31,

2021 August 1,

Service cost $ 24,937 $ 25,080 $ 1,510 $ 1,418

Interest cost 26,000 25,038 1,560 1,602

Expected return on plan assets ( 47,984 ) ( 44,484 ) — —

Amortization of net actuarial loss and prior service cost 7,500 11,018 2,309 2,068

Total expense $ 10,453 $ 16,652 $ 5,379 $ 5,088

TJX’s policy with respect to the funded plan is to fund, at a minimum, the amount required to maintain a funded status of 80 % of the applicable pension liability (the Funding Target pursuant to the Internal Revenue Code section 430) or such other amount as is sufficient to avoid restrictions with respect to the funding of nonqualified plans under the Internal Revenue Code.

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Long-Term Debt and Credit Lines

The table below presents long-term debt, exclusive of current installments, as of May 1, 2021, January 30, 2021 and May 2, 2020.

The table below presents long-term debt, exclusive of current installments, as of July 31, 2021, January 30, 2021 and August 1, 2020.

All amounts are net of unamortized debt discounts.

In thousands May 1,

In thousands July 31,

2021 January 30,

Revolving credit facilities:

$ 500 million revolver, maturing March 11, 2022

$ — $ — $ 500,000

$ 500 million revolver, maturing May 10, 2024

2021 August 1,

General corporate debt:

2.750 % senior unsecured notes, redeemed on April 15, 2021 (effective interest rate of 2.76 % after reduction of unamortized debt discount of $ 25 at January 30, 2021 and $ 81 at May 2, 2020)

2.750 % senior unsecured notes, redeemed on April 15, 2021 (effective interest rate of 2.76 % after reduction of unamortized debt discount of $ 25 at January 30, 2021 and $ 63 at August 1, 2020)

$ — $ 749,975 $ 749,937

2.500 % senior unsecured notes, maturing May 15, 2023 (effective interest rate of 2.51 % after reduction of unamortized debt discount of $ 89 at May 1, 2021, $ 100 at January 30, 2021 and $ 134 at May 2, 2020)

2.500 % senior unsecured notes, maturing May 15, 2023 (effective interest rate of 2.51 % after reduction of unamortized debt discount of $ 78 at July 31, 2021, $ 100 at January 30, 2021 and $ 122 at August 1, 2020)

499,922 499,900 499,878

3.500 % senior unsecured notes, maturing April 15, 2025 (effective interest rate of 3.58 % after reduction of unamortized debt discount of $ 3,956 at May 1, 2021, $ 4,208 at January 30, 2021 and $ 4,966 at May 2, 2020)

3.500 % senior unsecured notes, redeemed on June 4, 2021 (effective interest rate of 3.58 % after reduction of unamortized debt discount of $ 4,208 at January 30, 2021 and $ 4,713 at August 1, 2020)

— 1,245,792 1,245,287

2.250 % senior unsecured notes, maturing September 15, 2026 (effective interest rate of 2.32 % after reduction of unamortized debt discount of $ 3,979 at May 1, 2021, $ 4,165 at January 30, 2021 and $ 4,725 at May 2, 2020)

2.250 % senior unsecured notes, maturing September 15, 2026 (effective interest rate of 2.32 % after reduction of unamortized debt discount of $ 3,792 at July 31, 2021, $ 4,165 at January 30, 2021 and $ 4,538 at August 1, 2020)

996,208 995,835 995,462

3.750 % senior unsecured notes, maturing April 15, 2027 (effective interest rate of 3.76 % after reduction of unamortized debt discount of $ 437 at May 1, 2021, $ 456 at January 30, 2021 and $ 511 at May 2, 2020)

3.750 % senior unsecured notes, redeemed on June 4, 2021 (effective interest rate of 3.76 % after reduction of unamortized debt discount of $ 456 at January 30, 2021 and $ 493 at August 1, 2020)

— 749,544 749,507

1.150 % senior unsecured notes, maturing May 15, 2028 (effective interest rate of 1.18 % after reduction of unamortized debt discount of $ 907 at May 1, 2021 and $ 939 at January 30, 2021)

1.150 % senior unsecured notes, maturing May 15, 2028 (effective interest rate of 1.18 % after reduction of unamortized debt discount of $ 875 at July 31, 2021 and $ 939 at January 30, 2021)

499,125 499,061 —

3.875 % senior unsecured notes, maturing April 15, 2030, see tender offer details below (effective interest rate of 3.89 % after reduction of unamortized debt discount of $ 553 at May 1, 2021, $ 568 at January 30, 2021 and $ 1,549 at May 2, 2020)

3.875 % senior unsecured notes, maturing April 15, 2030;

see tender offer details below (effective interest rate of 3.89 % after reduction of unamortized debt discount of $ 537 at July 31, 2021, $ 568 at January 30, 2021 and $ 1,510 at August 1, 2020)

495,313 495,282 1,248,490

1.600 % senior unsecured notes, maturing May 15, 2031 (effective interest rate of 1.61 % after reduction of unamortized debt discount of $ 595 at May 1, 2021 and $ 610 at January 30, 2021)

1.600 % senior unsecured notes, maturing May 15, 2031 (effective interest rate of 1.61 % after reduction of unamortized debt discount of $ 581 at July 31, 2021 and $ 610 at January 30, 2021)

499,419 499,390 —

4.500 % senior unsecured notes, maturing April 15, 2050;

see tender offer details below (effective interest rate of 4.52 % after reduction of unamortized debt discount of $ 2,189 at May 1, 2021, $ 2,208 at January 30, 2021 and $ 4,405 at May 2, 2020)

see tender offer details below (effective interest rate of 4.52 % after reduction of unamortized debt discount of $ 2,170 at July 31, 2021, $ 2,208 at January 30, 2021 and $ 4,368 at August 1, 2020)

383,329 383,291 745,632

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Long-term debt $ 3,352,892 $ 5,332,921 $ 5,445,325

During the fiscal quarter ended May 2, 2020 , given the rapidly changing environment and level of uncertainty created by the COVID-19 pandemic, the Company completed the issuance and sale of (a) $ 1.25 billion aggregate principal amount of 3.500 % notes due 2025, (b) $ 750 million aggregate principal amount of 3.750 % notes due 2027, (c) $ 1.25 billion aggregate principal amount of 3.875 % notes due 2030 and (d) $ 750 million aggregate principal amount of 4.500 % notes due 2050.

Portions of the 3.875 % notes due 2030 and 4.500 % notes due 2050 were subsequently repurchased, reducing the aggregate principal amount outstanding to $ 495.5 million and $ 385.5 million, respectively, pursuant to cash tender offers made by the Company in December 2020.

On June 4, 2021, the Company completed make-whole calls for its $ 1.25 billion aggregate principal amount of 3.500 % Notes maturing in 2025 and its $ 750 million aggregate principal amount of 3.750 % Notes maturing in 2027, which 3.500 % Notes and 3.750 % Notes were originally issued and sold during the fiscal quarter ended May 2, 2020.

As a result of these redemptions prior to their scheduled maturities, the Company recorded a pre-tax debt extinguishment charge of $ 242 million in the second quarter of fiscal 2022.

On April 15, 2021, the Company redeemed all of the outstanding $ 750 million in aggregate principal amount of its 2.750 % Notes due June 15, 2021 at a redemption price equal to 100 % of the principal amount thereof, plus accrued and unpaid interest thereon to the redemption date.

During the fiscal quarter ended May 2, 2020, the Company issued and sold $ 1.25 billion aggregate principal amount of 3.875 % Notes due 2030 and $ 750 million aggregate principal amount of 4.500 % Notes due 2050, portions of which were subsequently repurchased pursuant to cash tender offers completed by the Company in December 2020, reducing the aggregate principal amount outstanding to $ 495.5 million and $ 385.5 million, respectively.

Interest on these notes are payable semi-annually.

In November 2020, TJX completed the issuance of (a) $ 500 million aggregate principal amount of 1.150 % Notes due 2028 and (b) $ 500 million aggregate principal amount of 1.600 % Notes due 2031.

Interest on these notes are payable semi-annually beginning May 2021.

Subsequent to the end of the first quarter of fiscal 2022, the Company announced make-whole calls for its $ 1.25 billion aggregate principal amount of 3.500 % Notes maturing in 2025 and its $ 750 million aggregate principal amount of 3.750 % Notes maturing in 2027 pursuant to notices of redemption issued to holders of such notes in accordance with the applicable indenture.

These make-whole calls are expected to settle in June 2021, and once completed the Company anticipates recording a pre-tax loss on the early extinguishment of these notes of approximately $ 250 million in the second quarter of fiscal 2022.

During the fiscal quarter ended May 1, 2021, TJX had a $ 500 million 364 day revolving credit facility that matures in August 2021 (the “364-Day Revolving Credit Facility”), a $ 500 million revolving credit facility that matures in March 2022 (the “2022 Revolving Credit Facility”) and a $ 500 million revolving credit facility that matures in May 2024 (the “2024 Revolving Credit Facility”).

Under these credit facilities, the Company has borrowing capacity of $ 1.5 billion, all of which remains available to the Company.

Interest on these notes are payable semi-annually.

On June 25, 2021, the Company entered into a revolving credit agreement providing for a $ 1 billion senior unsecured revolving credit facility maturing on June 25, 2026 (the “2026 Revolving Credit Facility”).

The 2026 Revolving Credit Facility replaced the Company's $ 500 million revolving credit facility that matures in March 2022 (the “2022 Revolving Credit Facility”) and the $ 500 million 364 day revolving credit facility that matures in August 2021 (the “364-Day Revolving Credit Facility”).

Each of the 2022 Revolving Credit Facility and the 364-Day Revolving Credit Facility were terminated on June 25, 2021.

With the 2026 Revolving Credit Facility and the Company’s existing $ 500 million revolving credit facility that matures in May 2024 (the “2024 Revolving Credit Facility”), the Company maintained its borrowing capacity of $ 1.5 billion, all of which remains available to the Company as of July 31, 2021.

The terms of these revolving credit facilities require quarterly payments on the committed amount and payment of interest on borrowings at rates based on LIBOR or a base rate plus a variable margin, in each case based on the Company’s long-term debt ratings.

The 2022 Revolving Credit Facility and the 2024 Revolving Credit Facility require usages fees based on total credit extensions under such facilities.

As of May 2, 2020, $ 1 billion was outstanding under these two facilities, and was subsequently repaid in July 2020.

The amounts drawn are included as outstanding long-term debt in the table above.

The six month interest rate on these borrowings was 1.757 % through May 15, 2020, and increased to 2.007 % through the payoff date.

As of May 1, 2021 and January 30, 2021, there were no amounts outstanding under any of the Company’s facilities.

The 2024 Revolving Credit Facility requires usage fees based on total credit extensions under the facility.

The revolving credit facilities require the Company to maintain a quarterly-tested leverage ratio of funded debt to earnings before interest, taxes, depreciation and amortization and rentals.

As of July 31, 2021, January 30, 2021 and August 1, 2020, there were no amounts outstanding under any of the Company’s facilities.

TJX was in compliance with all covenants related to its credit facilities at the end of all periods presented.

As of May 1, 2021, January 30, 2021 and May 2, 2020, TJX Canada had two uncommitted credit lines, a C$ 10 million facility for operating expenses and a C$ 10 million letter of credit facility.

As of May 1, 2021, January 30, 2021 and May 2, 2020, and during the quarters and year then ended, there were no amounts outstanding on the Canadian credit line.

As of May 1, 2021, January 30, 2021 and May 2, 2020, our European business at TJX International had an uncommitted credit line of £ 5 million.

As of May 1, 2021, January 30, 2021 and May 2, 2020, and during the quarters and year then ended, there were no amounts outstanding on the European credit line.

The e ffective income tax rate was 26.0 % for the first quarter of fiscal 2022 and 33.9 % for the first quarter of fiscal 2021.

The decrease in the effective income tax rate was primarily a result of the ability to carry back the anticipated loss from the first quarter of fiscal 2021 to earlier tax years with higher tax rates due to a benefit provided by the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) enacted on March 27, 2020.

TJX had net unrecognized tax benefits of $ 278 million as of May 1, 2021, $ 272 million as of January 30, 2021 and $ 256 million as of May 2, 2020.

As of July 31, 2021, January 30, 2021 and August 1, 2020, TJX Canada had two uncommitted credit lines, a C$ 10 million facility for operating expenses and a C$ 10 million letter of credit facility.

As of July 31, 2021, January 30, 2021 and August 1, 2020, and during the quarters and year then ended, there were no amounts outstanding on the Canadian credit line.

As of July 31, 2021, January 30, 2021 and August 1, 2020, our European business at TJX International had an uncommitted credit line of £ 5 million.

As of July 31, 2021, January 30, 2021 and August 1, 2020, and during the quarters and year then ended, there were no amounts outstanding on the European credit line.

The e ffective income tax rate was 25.5 % for the second quarter of fiscal 2022 and ( 132.8 )% for the second quarter of fiscal 2021.

The effective income tax rate was 25.7 % for the first six months of fiscal 2022 and 23.2 % for the first six months of fiscal 2021.

The increase in the effective income tax rate for the quarter and six month period was primarily due to the decrease of anticipated benefit from the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) enacted on March 27, 2020 in the second quarter of fiscal 2021.

TJX had net unrecognized tax benefits of $ 280 million as of July 31, 2021, $ 272 million as of January 30, 2021 and $ 262 million as of August 1, 2020.

TJX is subject to U.S.

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TJX’s accounting policy classifies interest and penalties related to income tax matters as part of income tax expense.

The total accrued amount on the Consolidated Balance Sheets for interest and penalties was $ 38 million as of May 1, 2021, $ 36 million as of January 30, 2021 and $ 30 million as of May 2, 2020.

The total accrued amount on the Consolidated Balance Sheets for interest and penalties was $ 40 million as of July 31, 2021, $ 36 million as of January 30, 2021 and $ 32 million as of August 1, 2020.

Based on the outcome of tax examinations or judicial or administrative proceedings, or as a result of the expiration of statutes of limitations in specific jurisdictions, it is reasonably possible that unrecognized tax benefits for certain tax positions taken on previously filed tax returns may change materially from those presented in the Consolidated Financial Statements.

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Contingent Obligations

TJX has contingent obligations on leases, for which it was a lessee or guarantor, which were assigned to third parties without TJX being released by the landlords.

TJX has contingent obligations on leases, for which it was a lessee or guarantor, that were assigned to third parties without TJX being released by the landlords.

The Company has had numerous leases from its former operations where its guarantee required it to satisfy some of these lease obligations and TJX established appropriate reserves.

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The Company may also be contingently liable for assignments and subleases if the assignees or subtenants do not fulfill their obligations.

TJX estimates the undiscounted value of these contingent obligations as of May 1, 2021 to be approximately $ 9 million.

TJX estimates the undiscounted value of these contingent obligations as of July 31, 2021 to be approximately $ 8 million.

TJX believes that most or all of these contingent obligations will not revert to the Company and, to the extent they do, may be resolved for substantially less due to mitigating factors including TJX's ability to potentially further sublet.

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TJX is subject to certain legal proceedings, lawsuits, disputes and claims that arise from time to time in the ordinary course of its business.

In addition, TJX is a defendant in several lawsuits filed in federal and state courts brought as putative class, collective, and/or representative actions on behalf of various groups of current and former salaried and hourly associates in the U.S.

The lawsuits allege violations of the Fair Labor Standards Act and of state wage and hour and other labor statutes.

The lawsuits are in various procedural stages and seek monetary damages, injunctive relief and attorneys’ fees.

In connection with ongoing litigation, an immaterial amount has been accrued in the accompanying Consolidated Financial Statements.

In addition, TJX is a defendant in a lawsuit brought as a putative class action on behalf of a group of current and former salaried and hourly associates in the U.S.

The lawsuit alleges violations of the Fair Labor Standards Act and of state wage and hour and other labor statutes.

The lawsuit seeks monetary damages, injunctive relief and attorneys’ fees.

TJX has accrued immaterial amounts in the accompanying Consolidated Financial Statements for certain of its legal proceedings.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements