TJX, parent of the TJ Maxx and Marshalls discount chains, among others, is still clearly in the learning phase with the Bobs Stores chain they acquired in December 2003. Their merchants are attempting to find the right formula for the stores that will propel them to the planned 400 doors in the U.S. For the short term, TJX will shutter one store in the fall and open two others for a total of 32 doors by year-end.
TJX said their plan is to grow the business “slowly and deliberately” and are working on a formula for fall that is less promotionally driven. The two new stores planned for the back half will reflect a new format and merchandising plan.
Management said that sales at Bobs “didnt materialize as expected”, resulting in total sales of about $63.8 million, which was below the companys plan. TJX had expected to report a loss in the period, but they missed the number by three cents on the bottom line, due to higher than expected markdown activity in the stores. TJX reported an $8.2 million loss at Bobs in Q2.
Inventory looks to be pretty clean going into the fall season. Management said spring/summer inventories were $38 million less than they were at quarter-end LY.
Bobs Stores revenues represented just 1.9% of total TJX Companies revenues for the period. TJX is reducing its outlook for Bobs for the third quarter, reducing the revenue plan roughly 8.9% to $82 million from its previous plan of $90 million. Bobs is now expected to post a $3.0 million loss for the Q3 period versus previous expectations of a $1.0 million profit.
For the total company, TJX saw net sales increase 12.0% to $3.41 billion in Q2 versus $3.05 billion in the year-ago period. Comp store sales rose 3.0% for the period. Net income dipped 4.1% to $118.2 million, or 24 cents a share, from net income of $123.3 million , or 24 cents a share, in the year-ago period.
>>> In the end, Bobs is still just a rounding error at TJX