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What changed in TJX Companies's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of TJX Companies's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+283 added−292 removedSource: 10-K (2023-03-29) vs 10-K (2022-03-30)

Top changes in TJX Companies's 2023 10-K

283 paragraphs added · 292 removed · 228 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

42 edited+6 added−2 removed35 unchanged
Biggest changeWe also paid discretionary bonuses to the vast majority of our Associates, including those in our stores and distribution centers, that recognizes the significant contributions of our workforce. Trademarks We have the right to use our principal trademarks and service marks, which are T.J. Maxx, Marshalls, HomeGoods, Winners, Homesense/HomeSense, T.K. Maxx, Sierra and Sierra Trading Post, in relevant countries.
Biggest changeTrademarks We have the right to use our principal trademarks and service marks, which are T.J. Maxx, Marshalls, HomeGoods, Winners, Homesense/HomeSense, T.K. Maxx, Sierra and Sierra Trading Post, in relevant countries. We expect our rights in these trademarks and service marks to endure in locations where we use them for as long as we continue to do so.
We do this by offering quality, fashionable, brand name and designer merchandise in our stores with retail prices that are generally 20% to 60% below full-price retailers’ (including department, specialty, and major online retailers) regular prices on comparable merchandise, every day. We do not generally engage in promotional pricing activity such as sales or coupons.
We do this by offering quality, fashionable, brand name and designer merchandise in our stores with retail prices that are generally 20% to 60% below full-price retailers’ (including department, specialty, and major online retailers) regular prices on comparable merchandise, every day. Our practice is to not engage in promotional pricing activity such as sales or coupons.
Sierra, acquired in 2012 and rebranded from Sierra Trading Post in 2018, is a leading off-price retailer of brand name active and outdoor apparel, footwear, and gear (including sporting goods, snow and water sport, camping, fishing) for the whole family, as well as home fashions and pet. Sierra operates sierra.com and 59 retail stores in the U.S.
Sierra, acquired in 2012 and rebranded from Sierra Trading Post in 2018, is a leading off-price retailer of brand name active and outdoor apparel, footwear, and gear (including sporting goods, snow and water sport, camping, fishing) for the whole family, as well as home fashions and pet. Sierra operates 78 retail stores in the U.S. and sierra.com.
The following table provides store growth information for our four major segments for the two most recently completed fiscal years, as well as our estimates of the long-term store growth potential of these segments in their current geographies: Approximate Average Store Size (square feet) Number of Stores at Year End Estimated Store Potential Fiscal 2021 Fiscal 2022 Marmaxx: T.J.
The following table provides store growth information for our four major segments for the two most recently completed fiscal years, as well as our estimates of the long-term store growth potential of these segments in their current geographies: Approximate Average Store Size (square feet) Number of Stores at Year End Estimated Store Potential Fiscal 2022 Fiscal 2023 Marmaxx: T.J.
Maxx in 1976 and acquired Marshalls in 1995. Both chains sell family apparel (including footwear and accessories), home fashions (including home basics, decorative accessories and giftware) and other merchandise. We primarily differentiate T.J. Maxx and Marshalls through different product assortment, including an expanded assortment of jewelry and accessories and a high-end designer section called The Runway at T.J.
Maxx in 1976 and acquired Marshalls in 1995. Both chains sell family apparel (including footwear and accessories), home fashions (including home basics, decorative accessories and giftware) and other merchandise. We primarily differentiate T.J. Maxx and Marshalls through different product assortment, including an expanded assortment of jewelry and accessories and a high-end designer department called The Runway at T.J.
This chain operates 147 stores and offers an array of home decor, basics, furniture, and seasonal home merchandise. Marshalls, launched in Canada in 2011, operates 106 stores and offers off-price values on family apparel and home fashions. Marshalls has an expanded dress department, and The CUBE, a juniors’ department. TJX INTERNATIONAL Our TJX International segment operates the T.K.
This chain operates 151 stores and offers an array of home decor, basics, furniture, and seasonal home merchandise. Marshalls, launched in Canada in 2011, operates 106 stores and offers off-price values on family apparel and home fashions. Marshalls has an expanded dress department, and The CUBE, a juniors’ department. TJX INTERNATIONAL Our TJX International segment operates the T.K.
Our goal is to operate with lean inventory levels compared to conventional retailers to give us the flexibility to seek out and to take advantage of these opportunities as they arise, close to the time it is needed in our stores and online and when we have more visibility into fashion trends and price.
Our goal is to operate with lean inventory levels compared to conventional retailers to give us the flexibility to seek out and to take advantage of these opportunities as they arise, close to the time the merchandise is needed in our stores and online and when we have more visibility into fashion trends and price.
Our approach to compensation across the organization reflects our global total rewards principles, which include encouraging teamwork and collaboration, being fair and equitable, and sharing in the success of the Company. For fiscal 2022, we continued our One TJX approach to annual incentive compensation, with all eligible Associates measured against global TJX performance goals.
Our approach to compensation across the organization reflects our global total rewards principles, which include encouraging teamwork and collaboration, being fair and equitable, and sharing in the success of the Company. For fiscal 2023, we continued our One TJX approach to annual incentive compensation, with all eligible Associates measured against global TJX performance goals.
In addition to our four main segments, we operate the Sierra business. The results of Sierra are included with the Marmaxx segment. MARMAXX Our T.J. Maxx and Marshalls chains in the United States (“Marmaxx”) are collectively the largest off-price retailer in the United States with a total of 2,432 stores. We founded T.J.
In addition to our four main segments, we operate the Sierra business. The results of Sierra are included with the Marmaxx segment. MARMAXX Our T.J. Maxx and Marshalls chains in the United States (“Marmaxx”) are collectively the largest off-price retailer in the United States with a total of 2,482 stores. We founded T.J.
Winners is the leading off-price family apparel and home fashions retailer in Canada and was acquired by TJX in 1990. Winners operates 293 stores, with select stores offering jewelry and some featuring The Runway, a high-end designer department. HomeSense introduced the off-price home fashions concept to Canada in 2001.
Winners is the leading off-price family apparel and home fashions retailer in Canada and was acquired by TJX in 1990. Winners operates 297 stores, with select stores offering jewelry and some featuring The Runway, a high-end designer department. HomeSense introduced the off-price home fashions concept to Canada in 2001.
Maxx and Homesense chains in Europe and the T.K. Maxx chain in Australia. Launched in 1994, T.K. Maxx introduced off-price retail to Europe and remains Europe’s only major brick-and-mortar off-price retailer of apparel and home fashions. With 618 stores in Europe, T.K. Maxx operates in the U.K., Ireland, Germany, Poland, Austria and the Netherlands.
Maxx and Homesense chains in Europe and the T.K. Maxx chain in Australia. Launched in 1994, T.K. Maxx introduced off-price retail to Europe and remains Europe’s only major brick-and-mortar off-price retailer of apparel and home fashions. With 629 stores in Europe, T.K. Maxx operates in the U.K., Ireland, Germany, Poland, Austria and the Netherlands.
We ship substantially all of our merchandise to our stores through a network of distribution centers, fulfillment centers and warehouses as well as shipping centers operated by third parties. 6 Store Growth Expansion of our business through the addition of new stores continues to be an important part of our global growth strategy.
We ship substantially all of our merchandise to our stores through a network of distribution centers, fulfillment centers and warehouses as well as shipping centers operated by third parties. 7 Store Growth Expansion of our business through the addition of new stores continues to be an important part of our global growth strategy.
Our buyers have more visibility into consumer, fashion and market trends and pricing when we buy closer to need, which can help us “buy smarter” and reduce our markdown exposure. Our selling floor space is flexible, without walls between departments and largely free of permanent fixtures, so we can easily expand and contract departments to accommodate the merchandise we purchase.
Our buyers have more visibility into consumer, fashion and market trends and pricing when we buy closer to need, which can help us buy better and reduce our markdown exposure. Our selling floor space is flexible, without walls between departments and largely free of permanent fixtures, so we can easily expand and contract departments to accommodate the merchandise we purchase.
We also offer TJX-branded credit cards in the U.S. through a bank, but do not own the customer receivables. Distribution We operate distribution centers encompassing approximate ly 24 million square feet in six countries .
We also offer TJX-branded credit cards in the U.S. through a bank, but do not own the customer receivables. Distribution We operate distribution centers encompassing approximate ly 26 million square feet in six countries .
Training and Career Development We are highly focused on teaching and mentoring to support the career growth and success of our Associates, and we believe these efforts have promoted retention, stability and increased expertise in our workforce.
We are highly focused on teaching and mentoring to support the career growth and success of our Associates, and we believe these efforts have promoted retention, stability, and increased expertise in our workforce.
We have nearly 4,700 stores and five distinctive branded e-commerce sites that offer a rapidly changing assortment of quality, fashionable, brand name and designer merchandise at prices generally 20% to 60% below full-price retailers’ (including department, specialty, and major online retailers) regular prices on comparable merchandise, every day. Our mission is to deliver great value to our customers every day.
We have over 4,800 stores and five distinctive branded e-commerce sites that offer a rapidly changing assortment of quality, fashionable, brand name and designer merchandise at prices generally 20% to 60% below full-price retailers’ (including department, specialty, and major online retailers) regular prices on comparable merchandise, every day. Our mission is to deliver great value to our customers every day.
We are typically willing to purchase less-than-full assortments of items, styles and sizes as well as quantities ranging from small to very large; we are able to disperse merchandise across our geographically diverse network of stores and to target specific markets; we typically pay promptly according to our payment terms; we generally do not ask for typical retail concessions (such as advertising, promotional and markdown allowances), delivery concessions (such as drop shipments to stores or delayed deliveries) or return privileges; and we have an excellent credit rating.
We are typically willing to purchase less-than-full assortments of items, styles and sizes as well as quantities ranging from small to very large; we are able to disperse merchandise across our geographically diverse network of store s and to target specific markets; we pay promptly according to our payment terms; our practice is to not ask for typical retail concessions (such as advertising, promotional and markdown allowances), delivery concessions (such as drop shipments to stores or delayed deliveries) or return privileges; and we have an excellent credit rating.
Its 77 stores offer a merchandise mix of home fashions similar to that of HomeGoods in the U.S. and HomeSense in Canada. We acquired Trade Secret in Australia in 2015 and re-branded it under the T.K. Maxx name during 2017. The merchandise offering at T.K. Maxx in Australia's 68 stores is comparable to T.J. Maxx.
Its 78 stores offer a merchandise mix of home fashions similar to that of HomeGoods in the U.S. and HomeSense in Canada. We acquired Trade Secret in Australia in 2015 and re-branded it under the T.K. Maxx name during 2017. The merchandise offering at T.K. Maxx in Australia's 74 stores is comparable to T.J. Maxx.
(b) Includes 48 Sierra stores in fiscal 2021, and 59 Sierra stores for fiscal 2022. Sierra stores are not included in estimated store potential. Some of our home fashion stores are co-located with one of our apparel stores in a “combo” or superstore format. We count each of the stores in the combo or superstore format as a separate store.
(b) Includes 59 Sierra stores in fiscal 2022 and 78 Sierra stores for fiscal 2023. Sierra stores are not included in estimated store potential. Some of our home fashion stores are co-located with one of our apparel stores in a “combo” or superstore format. We count each of the stores in the combo or superstore format as a separate store.
Our large, global workforce supports the execution of our flexible off-price business model, including the timing and frequency of store deliveries and the management of a rapidly changing mix of merchandise in nearly 4,700 retail stores in nine countries and across five distinctive branded e-commerce sites.
Our large, global workforce supports the execution of our flexible off-price business model, including the timing and frequency of store deliveries and the management of a rapidly changing mix of merchandise in over 4,800 retail stores in nine countries and across five distinctive branded e-commerce sites.
Fiscal 2023 means the fiscal year ending January 28, 2023. Unless otherwise indicated, all store information in this Item 1 is as of January 29, 2022, and references to store square footage are to gross square feet. Our Businesses We operate our business in four main segments: Marmaxx and HomeGoods, both in the U.S., TJX Canada and TJX International.
Unless otherwise indicated, all store information in this Item 1 is as of January 28, 2023, and references to store square footage are to gross square feet. Our Businesses We operate our business in four main segments: Marmaxx and HomeGoods, both in the U.S., TJX Canada and TJX International.
Human Capital As of January 29, 2022, we had approximately 340,000 employees (who we refer to as Associates), many of whom work less than 40 hours per week. Approximately 86% of these Associates worked in our retail stores. We hire thousands of temporary employees each year, particularly during the peak back-to-school and holiday seasons.
Human Capital As of January 28, 2023, we had approximately 329,000 employees (who we refer to as Associates), many of whom worked less than 40 hours per week. Approximately 86% of these Associates worked in our retail stores. We hire thousands of temporary employees each year, particularly during the peak back-to-school and holiday seasons.
We believe our Associates are key to our business success, and we have remained committed to prioritizing the health and safety of our Associates and customers throughout the COVID-19 pandemic. 7 Workplace and Culture We work to foster a strong, supportive, and inclusive culture so that Associates at TJX feel welcome in the Company, valued for their contributions, and engaged with our business mission.
We believe our Associates are key to our business success, and we have remained committed to prioritizing the health and safety of our Associates. 8 Workplace and Culture We work to foster a strong, supportive, and inclusive culture so that Associates at TJX feel welcome in the Company, valued for their contributions, and engaged with our business mission.
Carol Meyrowitz 68 Executive Chairman of the Board since January 2016. Chairman of the Board from June 2015 to January 2016. Chief Executive Officer from January 2007 to January 2016. Director since 2006 and President from 2005 to January 2011. Consultant to TJX from January 2005 to October 2005. Senior Executive Vice President from March 2004 to January 2005.
Chairman of the Board from June 2015 to January 2016. Chief Executive Officer from January 2007 to January 2016. Director since 2006 and President from 2005 to January 2011. Consultant to TJX from January 2005 to October 2005. Senior Executive Vice President from March 2004 to January 2005. President, Marmaxx from 2001 to January 2005.
President, TJX Canada from October 2011 to February 2018. Managing Director T.K. Maxx, UK from April 2010 to October 2011. Executive Vice President, Chief Operating Officer, WMI from February 2006 to April 2010. Senior Vice President, Director of Store Operations, WMI from 2004 to 2006. Various store operations positions with TJX from 1988 to 2004.
Maxx, UK from April 2010 to October 2011. Executive Vice President, Chief Operating Officer, WMI from February 2006 to April 2010. Senior Vice President, Director of Store Operations, WMI from 2004 to 2006. Various store operations positions with TJX from 1988 to 2004.
Information appearing on tjx.com is not a part of, and is not incorporated by reference in, this Form 10-K. 8 INFORMATION ABOUT OUR EXECUTIVE OFFICERS The following are the executive officers of TJX as of March 30, 2022: Name Age Office and Business Experience Kenneth Canestrari 60 Senior Executive Vice President, Group President since September 2014.
Information appearing on tjx.com is not a part of, and is not incorporated by reference in, this Form 10-K. 9 INFORMATION ABOUT OUR EXECUTIVE OFFICERS The following are the executive officers of TJX as of March 29, 2023: Name Age Office and Business Experience Kenneth Canestrari 61 Senior Executive Vice President, Group President since September 2014.
We develop some of this merchandise ourselves in order to supplement the depth of, or fill gaps in, our expected merchandise assortment. 5 Manufacturers, retailers and other vendors make up our expansive universe of approximately 21,000 vendors, including thousands of new vendors in 2021, across the globe, which provides us substantial and diversified access to merchandise.
We develop some of this merchandise ourselves, which allows us to supplement the depth of, or fill gaps in, our expected merchandise assortment. 6 Manufacturers, retailers and other vendors made up our expansive universe of approximately 21,000 vendors across the globe, including thousands of new vendors in 2022, which provides us substantial and diversified access to merchandise.
Maxx (Europe) 28,000 602 618 Homesense (Europe) 19,000 78 77 T.K. Maxx (Australia) 21,000 62 68 Total TJX International 742 763 1,125 (a) TJX Total (b) 4,572 4,689 6,275 (a) Reflects store growth potential for T.K. Maxx in current geographies and for Homesense in the United Kingdom and Ireland.
Maxx (Europe) 28,000 618 629 Homesense (Europe) 19,000 77 78 T.K. Maxx (Australia) 21,000 68 74 Total TJX International 763 781 1,125 (a) TJX Total (b) 4,689 4,835 6,275 (a) Reflects store growth potential for T.K. Maxx in current geographies and for Homesense in the United Kingdom and Ireland.
President, HomeGoods from 2012 to September 2014. Executive Vice President, Chief Operating Officer, HomeGoods from 2008 until 2012. Various financial positions with TJX from 1988 to 2008. Scott Goldenberg 68 Senior Executive Vice President and Chief Financial Officer since April 2014; Executive Vice President and Chief Financial Officer from January 2012 to April 2014.
President, HomeGoods from 2012 to September 2014. Executive Vice President, Chief Operating Officer, HomeGoods from 2008 until 2012. Various financial positions with TJX from 1988 to 2008. Scott Goldenberg 69 Senior Executive Vice President, Finance since January 2023.
We use defined cultural factors and leadership competencies throughout our global business to express our organizational values, such as personal integrity, relationship-building and collaboration, and respect for our business model, and to promote consistency in leadership development. We have expanded our cultural factors and leadership competencies to include an explicit reference to inclusion and diversity.
We use defined cultural factors and leadership competencies throughout our global business to express our organizational values, such as personal integrity, relationship-building and collaboration, and respect for our business model, and to promote consistency in leadership development.
In 2017, we launched our Homesense chain in the U.S. Our 39 Homesense stores complement HomeGoods, offering a differentiated mix and expanded departments, such as large furniture, ceiling lighting and rugs, as well as a general store and an entertaining marketplace. 4 TJX CANADA Our TJX Canada segment operates the Winners, HomeSense and Marshalls chains in Canada.
Our 46 Homesense stores complement HomeGoods, offering a differentiated mix and expanded departments, such as large furniture, ceiling lighting and rugs, as well as a general store and an entertaining marketplace. 5 TJX CANADA Our TJX Canada segment operates the Winners, HomeSense and Marshalls chains in Canada.
HOMEGOODS Our HomeGoods chain, introduced in 1992, is the leading off-price retailer of home fashions in the U.S. Through its 850 stores and its e-commerce site homegoods.com launched in 2021, HomeGoods offers an eclectic assortment of home fashions, including furniture, rugs, lighting, soft home, decorative accessories, tabletop and cookware as well as expanded pet, kids and gourmet food departments.
Through its 894 stores and its e-commerce site, homegoods.com, launched in 2021, HomeGoods offers an eclectic assortment of home fashions, including furniture, rugs, lighting, soft home, decorative accessories, tabletop and cookware, as well as expanded pet and gourmet food departments. In 2017, we launched our Homesense chain in the U.S.
President, Marmaxx from 2001 to January 2005. Executive Vice President of TJX from 2001 to 2004. Various senior management and merchandising positions with Marmaxx and with Chadwick’s of Boston and Hit or Miss, former divisions of TJX, from 1983 to 2001. Douglas Mizzi 62 Senior Executive Vice President, Group President since February 2018.
Executive Vice President of TJX from 2001 to 2004. Various senior management and merchandising positions with Marmaxx and with Chadwick’s of Boston and Hit or Miss, former divisions of TJX, from 1983 to 2001. Douglas Mizzi 63 Senior Executive Vice President, Group President since February 2018. President, TJX Canada from October 2011 to February 2018. Managing Director T.K.
We expect our rights in these trademarks and service marks to endure in locations where we use them for as long as we continue to do so. Seasonality Our business is subject to seasonal influences. In the second half of the year, which includes the back-to-school and year-end holiday seasons, we generally realize higher levels of sales and income.
Seasonality Our business is subject to seasonal influences. In the second half of the year, which includes the back-to-school and year-end holiday seasons, we generally realize higher levels of sales and income.
Maxx 27,000 1,271 1,284 Marshalls 28,000 1,131 1,148 Total Marmaxx 2,402 2,432 3,000 HomeGoods: HomeGoods 23,000 821 850 Homesense 27,000 34 39 Total HomeGoods 855 889 1,500 TJX Canada: Winners 27,000 280 293 HomeSense 23,000 143 147 Marshalls 26,000 102 106 Total TJX Canada 525 546 650 TJX International: T.K.
Maxx 27,000 1,284 1,299 Marshalls 28,000 1,148 1,183 Total Marmaxx 2,432 2,482 3,000 HomeGoods: HomeGoods 23,000 850 894 Homesense 27,000 39 46 Total HomeGoods 889 940 1,500 TJX Canada: Winners 27,000 293 297 HomeSense 23,000 147 151 Marshalls 26,000 106 106 Total TJX Canada 546 554 650 TJX International: T.K.
President since January 2011. Senior Executive Vice President, Group President from August 2008 to January 2011. President, Marmaxx from 2005 to 2008. Senior Executive Vice President, Chief Operating Officer, Marmaxx from 2004 to 2005. Executive Vice President, Merchandising, Marmaxx from 2001 to 2004. Various merchandising positions with TJX since joining in 1989.
Executive Vice President, Merchandising, Marmaxx from 2001 to 2004. Various merchandising positions with TJX since joining in 1989. John Klinger 58 Executive Vice President and Chief Financial Officer since January 2023. Executive Vice President, Corporate Controller from 2019 to January 2023. Senior Vice President, Corporate Controller from 2015 to 2019.
Executive Vice President, Finance from June 2009 to January 2012. Senior Vice President, Corporate Controller from 2007 to 2009 and Senior Vice President, Director of Finance, Marmaxx, from 2000 to 2007. Various financial positions with TJX from 1983 to 1988 and 1997 to 2000. Ernie Herrman 61 Chief Executive Officer since January 2016. Director since October 2015.
Senior Executive Vice President and Chief Financial Officer from April 2014 to January 2023; Executive Vice President and Chief Financial Officer from January 2012 to April 2014. Executive Vice President, Finance from June 2009 to January 2012. Senior Vice President, Corporate Controller from 2007 to 2009 and Senior Vice President, Director of Finance, Marmaxx, from 2000 to 2007.
Our priorities include a focus on three core areas: increasing the representation of diverse talent through our talent pipeline, providing leaders with the tools needed to successfully manage individual differences, and integrating inclusive behaviors, language, and practices throughout the business.
Our global strategies include increasing the representation of diverse talent through our talent pipeline; providing leaders with tools to support difference with awareness, fairness, sensitivity, and transparency; and integrating inclusive behaviors, language and practices throughout the business.
Our teams globally are working to support these focus areas with many new programs, including recruitment strategies, mentoring programs, training and education, Associate-led Inclusion and Diversity advisory boards, and additional Associate Resource Groups.
Over the past two years, our teams globally have developed and launched many new programs, including recruitment strategies, training and education, Associate-led I&D advisory boards, and additional Associate Resource Groups.
Richard Sherr 65 Senior Executive Vice President, Group President since January 2012. President, HomeGoods from 2010 to 2012. Chief Operating Officer, Marmaxx from 2007 until 2010. Various merchandising positions at TJX from 1992 to 2007. The executive officers hold office until the next annual meeting of the Board in June 2022 and until their successors are elected and qualified. 9
The executive officers hold office until the next annual meeting of the Board in June 2023 and until their successors are elected and qualified. 10
See Risk Factors and Management’s Discussion and Analysis of Financial Condition a nd Results of Operations below for more information. In this report, fiscal 2022 means the fiscal year ended January 29, 2022; fiscal 2021 means the fiscal year ended January 30, 2021 and fiscal 2020 means the fiscal year ended February 1, 2020.
In this report, fiscal 2023 means the 52-week fiscal year ended January 28, 2023; fiscal 2022 means the 52-week fiscal year ended January 29, 2022 and fiscal 2021 means the 52-week fiscal year ended January 30, 2021. Fiscal 2024 means the 53-week fiscal year ending February 3, 2024.
Our policies and practices, including our open-door philosophy, encourage open and honest communication and engagement with the business.
In fiscal 2022, we included new leadership competency and cultural factors focused on inclusion-based values and behaviors, which we began to incorporate into our Leadership Development Toolkit during fiscal 2023. We believe our policies and practices, including our open-door philosophy, encourage open and honest communication and Associate engagement with the business.
Removed
During fiscal 2022, our business operations continued to be impacted by the COVID-19 pandemic. In addition to the temporary closures and reopenings of some of our stores, the pandemic has led to continued modifications of our operations, and has had an impact on our results of operations, financial position and liquidity, as well as consumer behavior.
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HOMEGOODS Our HomeGoods segment operates HomeGoods and Homesense chains. HomeGoods, introduced in 1992, is the leading off-price retailer of home fashions in the U.S.
Removed
The health and safety of our Associates continued to be a top priority during fiscal 2022, as we continued to manage health and safety protocols to address the evolving pandemic across our global operations and maintained many of our broad-based initiatives during fiscal 2022. Inclusion and Diversity We are committed to building a more inclusive and diverse workplace.
Added
Inclusion and Diversity (“I&D”) Our global workforce reflects a diversity of races, ethnicities, cultures, nationalities, and genders, and we are committed to continuing to build and support an inclusive and diverse workplace.
Added
Training and Career Development Our culture prioritizes Associate development and advancement within our organization and we have many Associates in managerial positions who have been with the Company for more than 10 years.
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Various financial positions with TJX from 1983 to 1988 and 1997 to 2000. Louise Greenlees 60 Senior Executive Vice President, Group President since June 2022. President, TJX Europe from January 2015 to June 2022. Managing Director, TJX Europe from January 2014 to January 2015. Group Buying Director, TJX Europe from April 2013 to January 2014.
Added
Homesense Managing Director, from December 2010 to April 2013. Ernie Herrman 62 Chief Executive Officer since January 2016. Director since October 2015. President since January 2011. Senior Executive Vice President, Group President from August 2008 to January 2011. President, Marmaxx from 2005 to 2008. Senior Executive Vice President, Chief Operating Officer, Marmaxx from 2004 to 2005.
Added
Senior Vice President, Divisional Chief Financial Officer, TJX Europe from 2011 to 2015. Vice President, Corporate Finance from 2011 to 2011. Vice President, Divisional Chief Financial Officer for AJWright from 2007 to 2011. Various financial positions with TJX since joining in 2000. Carol Meyrowitz 69 Executive Chairman of the Board since January 2016.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

99 edited+19 added−11 removed67 unchanged
Biggest changeBribery Act; – product liability claims from customers or investigations, enforcement or penalties from government agencies relating to products that are recalled, defective or otherwise noncompliant or alleged to be harmful; 12 – intellectual property enforcement and infringement issues; – concerns about human rights, working conditions and other labor rights and conditions in countries where merchandise is produced or materials are sourced, such as concerns related to treatment of the Uyghur population in the Xinjiang province of China; – concerns about transparent sourcing and supply chains; – currency exchange rates and financial or economic instability; and – political, military, or other disruptions in countries from, to or through which merchandise is imported, including in Ukraine and Russia.
Biggest changeBribery Act; – changes in duties, tariffs, trade restrictions, sanctions, quotas and voluntary export restrictions on imported merchandise, including, for example, additional trade requirements resulting from “Brexit,” the U.K.’s withdrawal from the European Union; tariffs and border adjustment taxes; changes to the United States Mexico Canada Agreement (the successor to the North American Free Trade Agreement) or successor or other trade agreements; – pandemics and epidemics (such as the COVID-19 pandemic) affecting sourcing, including manufacturing, buying or delivery; – strikes, threats of strikes and other events affecting delivery; – consumer perceptions of the safety or quality of imported merchandise; – compliance with product laws and regulations of the destination country; – product liability claims from customers or investigations, enforcement or penalties from government agencies relating to products that are recalled, defective or otherwise noncompliant or alleged to be harmful; – intellectual property enforcement and infringement issues; – concerns about transparent sourcing and supply chains; 13 – concerns about human rights, working conditions and other labor rights and conditions in countries where merchandise is produced or materials are sourced, such as concerns related to treatment of the Uyghur population in the Xinjiang province of China; – currency exchange rates and financial or economic instability (including potential financial instability related to banks); and – political, military, or other disruptions in countries from, to or through which merchandise is imported, including in Ukraine and Russia.
If we do not obtain the right merchandise at the right times, in the right quantities, at the right prices and in the right mix, our customer traffic and our sales, margins and other financial results could be adversely affected. Our opportunistic buying strategy places considerable discretion with our merchants.
Our customer traffic and our sales, margins, and other financial results could be adversely affected if we do not obtain the right merchandise at the right times, in the right quantities, at the right prices, and in the right mix. Our opportunistic buying strategy places considerable discretion with our merchants.
Although our business model allows us greater flexibility than many traditional retailers to meet consumer product preferences and trends (for example, by expanding and contracting merchandise categories in response to consumers’ changing tastes), we may not successfully do so, which could impact inventory turns, customer traffic and sales and add difficulty in attracting new customers, retaining existing customers, and encouraging frequent customer visits, which could adversely affect our results.
Although our business model allows us greater flexibility to meet consumer product preferences and trends than many traditional retailers (for example, by expanding and contracting merchandise categories in response to consumers’ changing tastes), we may not successfully do so, which could impact inventory turns, customer traffic, and sales, and may add difficulty in attracting new customers, retaining existing customers, and encouraging frequent customer visits, which could adversely affect our results.
The large size and scale of our operations, our multiple banners and locations across the U.S., Canada, Europe and Australia, and the autonomy afforded to the banners in some aspects of the business also increase the risk that our systems, controls, practices and policies may not be implemented effectively or consistently throughout our company, that information may not be appropriately shared across our operations, and that our marketing and communications strategies may lack cohesion.
The large size and scale of our operations, our multiple banners and locations across the U.S., Canada, Europe and Australia, and the autonomy afforded to the banners in some aspects of the business also increase the risk that our systems, controls, practices and policies may not be implemented effectively or consistently throughout our company, that information may not be appropriately shared across our operations, and/or that our marketing and communications strategies may lack cohesion.
Incidents involving us, our retail banners, our executives and other Associates, our board of directors, our policies and practices, our third-party providers, our vendors and others within our supply chain, the merchandise and brands, including our licensed or owned brands, that we sell, our investments, in regions where we have operations or investments, our partners and our industry more generally that erode trust or confidence could adversely affect our reputation and thereby impact our business, particularly if the incidents result in rapid or significant adverse publicity, protest, litigation or governmental inquiry.
Incidents involving us, our retail banners, our executives and other Associates, our board of directors, our policies and practices, our third-party providers, our vendors and others within our supply chain, the merchandise and brands that we sell, including our licensed or owned brands, our investments, the regions where we have operations or investments, our partners and our industry more generally that erode trust or confidence could adversely affect our reputation and thereby impact our business, particularly if the incidents result in rapid or significant adverse publicity, protest, litigation or governmental inquiry.
Our operating results have fluctuated from quarter to quarter at points in the past, including varying significantly from past quarters in recent years, and may do so again in the future.
Our operating results have fluctuated from quarter to quarter at points in the past, including in recent years varying significantly from past quarters, and may do so again in the future.
If we engage in mergers or acquisitions or investments in new businesses, or divest, close or consolidate any of our current businesses, our business could be subject to additional risks.
If we engage in mergers, acquisitions or investments in new businesses, or divest, close or consolidate any of our current businesses, our business could be subject to additional risks.
In addition, failure to comply with, or the perception that we have failed to comply with, other social compliance, product, labor and/or environmental standards or monitoring practices, which continue to evolve, related to the products we sell could subject us reputational harm and impact our financial results.
In addition, failure to comply with, or the perception that we have failed to comply with, other social compliance, product, labor and/or environmental standards or monitoring practices, which continue to evolve, related to the products we sell could subject us to reputational harm and impact our financial results.
We have a large workforce, and our ability to meet our labor needs and control labor costs is subject to various external factors such as minimum wage laws and benefits requirements; market pressures, including prevailing wage rates and benefit levels, unemployment levels and competition for labor from other industries; changing demographics and workforce trends; economic conditions, including inflation; interest rate changes; actuarial assumptions and methods; the costs of providing and managing retirement, health and other employee benefits, including health and insurance costs; and a dynamic regulatory and policy environment, including with respect to COVID-19 related mandates and protocols, health care, immigration, labor, employment, pension and other employee benefits, and taxes.
We have a large and disparate workforce, and our ability to meet our labor needs and control labor costs is subject to various external factors such as minimum wage laws and benefits requirements; market pressures, including prevailing wage rates and benefit levels, unemployment levels and competition for labor from other industries; economic conditions, including inflation; changing demographics and workforce trends; interest rate changes; actuarial assumptions and methods; the costs of providing and managing retirement, health and other employee benefits, including health and insurance costs; and a dynamic regulatory and policy environment, including with respect to health care, immigration, labor, employment, pension and other employee benefits, taxes, and COVID-19 related mandates and protocols.
We are subject to the risk of labor actions of various kinds, including work stoppages, as well as risks and potential material expenses associated with multiemployer plans, including from pension plan underfunding, benefit cuts, increased contribution or funding requirements, changes in plan terms, withdrawal liability, increased premium costs, conditions imposed under any governmental assistance programs or insolvency of other participating employers or governmental insurance programs.
We are subject to the risk of labor actions or disruptions of various kinds, including work stoppages, as well as risks and potential material expenses associated with multiemployer plans, including from pension plan underfunding, benefit cuts, increased contribution or funding requirements, changes in plan terms, withdrawal liability, increased premium costs, conditions imposed under any governmental assistance programs or insolvency of other participating employers or governmental insurance programs.
In addition, fluctuations in currency exchange rates may have a greater impact on our earnings and operating results if a counterparty to one of our hedging arrangements fails to perform. 18 REGULATORY, LEGAL AND COMPLIANCE RISKS Failure to comply with laws, rules, regulations and orders and applicable accounting principles and interpretations could negatively affect our business operations and financial performance.
In addition, fluctuations in currency exchange rates may have a greater impact on our earnings and operating results if a counterparty to one of our hedging arrangements fails to perform. REGULATORY, LEGAL AND COMPLIANCE RISKS Failure to comply with laws, rules, regulations and orders and applicable accounting principles and interpretations could negatively affect our business operations and financial performance.
Additional risks include, among others, understanding the local retail climate and trends, local customs and cultures, seasonal differences, business practices and competitive conditions; complying with relevant laws, rules and regulations; developing the appropriate infrastructure; identifying suitable partners for local operations and for integration with our global operations and effectively communicating and implementing company policies and practices in new, possibly remote, jurisdictions.
Additional risks include, among others, understanding the local retail climate and trends, local customs and cultures, seasonal differences, business practices and competitive conditions; complying with relevant laws, rules and regulations; developing an appropriate infrastructure; identifying suitable partners for local operations and for integration with our global operations and effectively communicating and implementing company policies and practices in new, possibly remote, jurisdictions.
Acquisition, investment or divestiture activities may divert attention of management from operating the existing businesses, and we may not effectively evaluate target companies, investments or investment partners or assess the risks, benefits and costs of buying, investing in or closing businesses or of the integration or attendant risks of acquired businesses or investments, all of which can be difficult, time-consuming and dilutive.
Acquisition, investment or divestiture activities may divert attention of management away from operating the existing businesses, and we may not effectively evaluate target companies, investments or investment partners or assess the risks, benefits, and costs of buying, investing in or closing businesses, or the integration or attendant risks of acquired businesses or investments, all of which can be difficult, time-consuming and dilutive.
These attempts could include use of malware, ransomware, phishing, social engineering, denial-of-service attacks, exploitation of system vulnerabilities or misconfigurations, employee malfeasance, digital and physical payment card skimmers, account takeovers and other forms of cyber-attacks. These attempts continue to increase in sophistication, heightening the risk of compromise or disruption.
These attempts include use of malware, ransomware, phishing, social engineering, denial-of-service attacks, exploitation of system vulnerabilities or misconfigurations, employee malfeasance, digital and physical payment card skimmers, account takeovers and other forms of cyber-attacks. These attempts continue to increase in sophistication, heightening the risk of compromise or disruption.
Meeting these expectations effectively generally involves identifying the right opportunities and making the right investments at the right time and with the right speed, among other things, and failure to do so may impact our financial results. We operate in highly competitive markets, and we may not be able to compete effectively.
Meeting these expectations effectively generally involves identifying the right opportunities and making the right investments at the right time and with the right speed, among other things, and failure to do so may impact our financial results. 11 We operate in highly competitive markets, and we may not be able to compete effectively.
If we fail to successfully implement our marketing efforts and these marketing efforts are not successful in driving expected traffic to our stores or if our competitors’ marketing programs are more effective than ours, our revenue or results of operations may be adversely affected. Customer traffic and demand for our merchandise may be influenced by our marketing efforts.
If we fail to successfully implement our marketing efforts, if our marketing efforts are not successful in driving expected traffic to our stores or if our competitors’ marketing programs are more effective than ours, our revenue or results of operations may be adversely affected. Customer traffic and demand for our merchandise may be influenced by our marketing efforts.
These activities may not meet our performance and other expectations and may expose us to unexpected or greater-than-expected costs, liabilities and risks, including, for example, from changes in law, market conditions, the retail industry or political conditions.
These activities may not meet our performance and other expectations and may expose us to unexpected or greater-than-expected costs, liabilities, and risks, including, for example, changes in law, market conditions, the retail industry or political conditions.
Even if a particular market has high commercial vacancies, if we are not able to find and lease appropriate real estate on attractive terms in the locations where we seek to open brick and mortar stores, or, for example, if new stores do not perform as well as we anticipated, we may need to change our planned growth in those markets.
Even if a particular market has high commercial vacancies, if we are not able to find and lease appropriate real estate on attractive terms in the locations where we seek to open brick and mortar stores, or, if new stores do not perform as well as we anticipated, we may need to change our planned growth in those markets.
We need to employ capable, engaged Associates for our stores and distribution centers in large numbers, and for other areas of our business, including information technology functions. We must constantly recruit new Associates to fill entry level and part-time positions with high rates of turnover and at times find seasonal talent in sufficient numbers.
We need to employ a large number of capable, engaged Associates for our stores and distribution centers and for other areas of our business, including information technology functions. We must constantly recruit new Associates to fill entry level and part-time positions with high rates of turnover and at times find seasonal talent in sufficient numbers.
In addition, market conditions and the impact of the pandemic on the global economy and global supply chain have impacted and may continue to impact the financial viability or business operations of some of our suppliers and transportation or logistics providers, which has interrupted and increased costs for, and may in the future interrupt and further increase costs for, our supply chain, and could require additional changes to our operations.
In addition, market conditions and the impact of the pandemic on the global economy and global supply chain have impacted and may continue to impact the financial viability or business operations of some of our suppliers and transportation or logistics providers, which has interrupted and increased costs related to, and may in the future interrupt and further increase costs related to, our supply chain, and could require additional changes to our operations.
Natural or other disasters, such as hurricanes, tornadoes, floods, earthquakes and other extreme weather; climate conditions; public health issues, such as pandemics and epidemics (such as the ongoing COVID-19 pandemic); fires or explosions; acts of war (such as Russia’s invasion of Ukraine); domestic or foreign terrorism or other acts of violence, including riots or active shooter situations; or cyberterrorism, nation-state cyber-attacks, or other cyber events could disrupt our operations in a number of ways, including by causing injury or serious harm to our Associates, including when traveling on business, or customers; severely damaging or destroying one or more of our stores, distribution facilities, data centers or office facilities, or could disrupt the operations of, or require the closure of, one or more of our vendors or other parts of our supply chain located in the affected areas.
Natural or other disasters, such as hurricanes, tornadoes, floods, earthquakes and other extreme weather; climate conditions; public health issues, such as pandemics and epidemics (such as the COVID-19 pandemic); fires or explosions; acts of war (such as the ongoing Russia-Ukraine conflict); domestic or foreign terrorism or other acts of violence (including riots or active shooter situations); or cyberterrorism, nation-state cyber-attacks, or other cyber events could disrupt our operations in a number of ways, including by causing injury or serious harm to our Associates, when traveling on business or otherwise, or customers; severely damaging or destroying one or more of our stores, distribution facilities, data centers or office facilities, or could disrupt the operations of, or require the closure of, one or more of our vendors or other parts of our supply chain located in the affected areas.
Our business depends upon our operations continuing to generate strong cash flow to supply capital to support our general operating activities, to fund our growth and our return of cash to stockholders through our stock repurchase programs and dividends, and to pay our interest and debt repayments.
Our business depends upon our operations continuing to generate strong cash flow to supply capital to support our general operating activities, to fund our anticipated growth and any return of cash to stockholders through our stock repurchase programs and dividends, and to pay our interest and debt repayments.
Any of these risks could adversely impact our operations, profitability or liquidity. 15 Our quarterly operating results fluctuate and may fall short of prior periods, our projections or the expectations of securities analysts or investors, which could adversely affect our stock price.
Any of these risks could adversely impact our operations, profitability or liquidity. 16 Our quarterly operating results fluctuate and may fall short of prior periods, our projections, or the expectations of securities analysts or investors, which could adversely affect our stock price.
While certain of these attempts have resulted in data security incidents, the unauthorized intrusion into our network discovered late in 2006 is the only such data security incident to date that has been material to the results of our operations.
While some of these attempts have resulted in data security incidents, the unauthorized intrusion into our network discovered late in 2006 is the only such data security incident to date that has been material to the results of our operations.
Just as with our current operations, there are risks inherent in opening and developing operations in new countries, such those related to compliance under the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act.
Just as with our current operations, there are risks inherent in opening and developing operations in new countries, including those related to compliance under the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act.
We compete with local, regional, national and international retailers that sell apparel, home fashions and other merchandise that we sell, including retailers that operate through stores, e-commerce and/or other media or channels. Some of our competitors are larger than we are or have more experience in selling certain product lines or through certain channels than we do.
We compete with local, regional, national and international retailers that sell apparel, home fashions and other merchandise that we sell, including retailers that operate through stores, e-commerce and/or other media, as well as omnichannel retailers. Some of our competitors are larger than we are or have more experience than we do in selling certain product lines or through certain channels.
However, we may not do so effectively and/or on a timely basis across our diverse merchandise categories and in each of the many markets in the U.S., Canada, Europe and Australia in which we do business. Trends and preferences in markets may differ from what we anticipate and could change rapidly.
However, we may not do so effectively and/or in a timely manner across our diverse merchandise categories and in each of the many markets in the U.S., Canada, Europe and Australia in which we do business. Trends and preferences in markets may differ from what we anticipate and could change rapidly.
Our effective income tax rate and future tax liability could be adversely affected by numerous factors including the results of tax audits and examinations, income before taxes being lower than anticipated in countries with lower statutory income tax rates and higher than anticipated in countries with higher statutory income tax rates, changes in income tax rates, changes in transfer pricing, changes in the valuation of deferred tax assets and liabilities, changes in applicable tax legislation (including proposed legislation in the Build Back Better Act), regulations, treaties and other guidance, and changes in accounting principles and interpretations relating to tax matters, any of which could adversely impact our results of operations and financial condition in future periods.
Our effective income tax rate and future tax liability could be adversely affected by numerous factors including the results of tax audits and examinations, income before taxes being lower than anticipated in countries with lower statutory income tax rates and higher than anticipated in countries with higher statutory income tax rates, changes in income tax rates, changes in transfer pricing, changes in the valuation of deferred tax assets and liabilities, changes in applicable tax legislation, regulations, treaties and other guidance, and changes in accounting principles and interpretations relating to tax matters, any of which could adversely impact our results of operations and financial condition in future periods.
For a period in fiscal 2021 during the first major peak of the COVID-19 outbreak, all of our stores, online businesses and distribution centers were temporarily closed, during which time we were unable to generate sales, though we continued to incur expenses.
During the first major peak of the COVID-19 outbreak in fiscal 2021, all of our stores, online businesses and distribution centers were temporarily closed, during which time we were unable to generate sales, though we continued to incur expenses.
In addition, we recorded intangible assets and goodwill and the value of the tradenames in connection with our last acquisitions and may similarly do so in the future in connection with other acquisitions.
In addition, in connection with our prior acquisitions, we recorded intangible assets and goodwill and the value of the tradenames, and may similarly do so in the future in connection with other acquisitions.
We depend upon strong cash flows from our operations to supply capital to fund our operations, growth, stock repurchases and dividends and interest and debt repayment.
We depend upon strong cash flows from our operations to supply capital to fund our operations, anticipated growth, any stock repurchases and dividends and interest and debt repayment.
These requirements, current or changing, could adversely affect our operating results, including those involving: – labor and employment practices and benefits, including for labor unions and works councils; – health, welfare and safety requirements, including vaccination and/or testing requirements, such as those implemented and proposed in connection with the COVID-19 pandemic; – import/export, supply chain, social compliance, trade restrictions and logistics, including resulting from changes to requirements or policies from the outcome of Brexit or the Uyghur Forced Labor Act; – climate change, energy and waste; – consumer protection, product safety and product compliance; – marketing; – financial regulations and reporting; – tax; – data protection and privacy, such as to comply with, or fines and penalties related to, General Data Protection Regulation in the European Union and the California Consumer Privacy Act; – Internet regulations, including e-commerce, electronic communications and privacy; – protection of intellectual property rights; and – compliance with governmental assistance programs.
These requirements, current or changing, could adversely affect our operating results, including those involving: – labor and employment practices and benefits, including for labor unions and works councils; – import/export, supply chain, social compliance, trade restrictions, and logistics, including resulting from changes to requirements or policies from the outcome of Brexit or the Uyghur Forced Labor Act and the emergence of widespread sanctions as a result of the ongoing Russia-Ukraine conflict; – climate change, energy and waste; – consumer protection, product safety and product compliance; – health, welfare and safety requirements, including vaccination and/or testing requirements, such as those implemented and proposed in connection with the COVID-19 pandemic; – marketing; – financial regulations and reporting; – tax; – data protection and privacy, such as to comply with, or fines and penalties related to, General Data Protection Regulation in the European Union and the California Consumer Privacy Act; – Internet regulations, including e-commerce, electronic communications and privacy; – protection of intellectual property rights; and – compliance with governmental assistance programs.
Similarly, in addition to the impact of regulatory or policy changes, regulatory volatility or uncertainty, including in areas such as international trade, including U.S. tariff policies; challenges presented by implementation following Brexit, as well as threats or occurrences of war (including Russia’s invasion of Ukraine), terrorism, pandemics or epidemics (such as the ongoing COVID-19 pandemic), supply chain disruptions, geopolitical instability or uncertainty and political or social unrest and/or conflict (locally or across regions) may have significant effects on consumer confidence and spending that can in turn, affect our financial results and impact the retail industry generally.
Similarly, in addition to the impact of regulatory or policy changes, regulatory volatility or uncertainty, including in areas such as international trade, including U.S. tariff policies; challenges presented by implementation following Brexit, as well as threats or occurrences of war (including the ongoing Russia-Ukraine conflict), terrorism, pandemics or epidemics (such as the COVID-19 pandemic), supply chain disruptions, geopolitical instability or uncertainty, uncertainty regarding the financial stability of banking institutions and political or social unrest and/or conflict (locally or across regions) may have significant effects on consumer confidence and spending that can in turn, affect our financial results and impact the retail industry generally.
These conditions and factors also shift trends in consumer spending that could affect our business. Although we believe our flexible off-price model helps us react to such changes, they may adversely affect our sales, cash flows, merchandise orders and results of operations and performance.
These conditions and factors also shift trends in consumer spending that could affect our business. Although we believe our flexible off-price model helps us react to such changes, shifts in the market may adversely affect our sales, cash flows, merchandise orders and results of operations and performance.
The risks that follow are those that we think, individually or in the aggregate, are potentially material to our business and could cause our actual results to differ materially from those stated or implied in forward-looking statements.
The risks listed below are those that we think, individually or in the aggregate, are potentially material to our business and could cause our actual results to differ materially from those stated or implied in forward-looking statements.
Our substantial size can make it challenging to run our complex operations effectively and to manage suitable internal resources and third-party providers with appropriate oversight to support our business effectively, including for administration, systems (including information technology systems), merchandising, sourcing, store operations, distribution, logistics and compliance.
The substantial size of our business can make it challenging to run our complex operations effectively and to manage suitable internal resources and third-party providers with appropriate oversight, including, for example, administration, systems (including information technology systems), merchandising, sourcing, store operations, distribution, logistics and compliance.
In addition, if we suspend our buyback program, as we did during fiscal 2021, or if we have an active buyback program and are repurchasing shares but do not repurchase the number of shares we contemplated pursuant to our stock repurchase programs, or if we reduce or suspend our dividend distributions, as we did for part of fiscal 2021, our earnings per share may be adversely affected.
In addition, if we suspend our buyback program, as we did during fiscal 2021, or if we have an active buyback program and are repurchasing shares but do not repurchase the number of shares we contemplated pursuant to our stock repurchase programs, our earnings per share may be adversely affected.
If we fail to increase our results over prior periods, to achieve our projected results or to meet the expectations of securities analysts or investors, our stock price may decline (as it did at times during fiscal 2021), and the decrease in the stock price may be disproportionate to the shortfall in our financial performance.
If we fail to increase our results over prior periods, to achieve our projected results or to meet the expectations of securities analysts or investors, our stock price may decline (as it did at times in recent years), and the decrease in the stock price may be disproportionate to the shortfall in our financial performance.
These challenges may be exacerbated if a portion of our workforce is working remotely for all or part of their time, as started to be the case during fiscal 2021, or is unable to work on site or is temporarily furloughed, as was the case in recent years.
These challenges may increase where a portion of our workforce is working remotely for all or part of their time, as started to be the case during fiscal 2021, or is unable to work on site or is temporarily furloughed, as was also the case in recent years.
Regardless of merit or outcome, these proceedings can be both time-consuming and disruptive to our operations and may cause significant expense and diversion of management attention.
Regardless of merit or outcome, these proceedings can be both time-consuming and disruptive to our operations and may cause reputational harm as well as significant expense and diversion of management attention.
In fiscal 2023, we anticipate that the conflict in Ukraine and related sanctions on Russia may impact fuel resources and operations of third parties along our supply chain such that our inventory flow and financial performance may be negatively impacted. Similarly, other commodity prices can fluctuate dramatically.
In fiscal 2023, the conflict in Ukraine and related sanctions on Russia impacted, and in fiscal 2024 we anticipate this will continue to impact, fuel resources and operations of third parties along our supply chain such that our inventory flow and financial performance may have been and may continue to be negatively impacted. Similarly, other commodity prices can fluctuate dramatically.
Adverse or unseasonable weather, such as storms, severe cold or heat or unseasonable temperatures (even if not extreme) may affect customers’ buying patterns and willingness to shop at all or in certain categories we offer, particularly in apparel and seasonal merchandise, which could impact our sales, customer satisfaction with our stores and our markdowns.
Adverse or unseasonable weather, such as storms, severe cold or heat or unseasonable temperatures (even if not extreme), which could increase in both frequency and severity, may also affect customers’ buying patterns and willingness to shop at all or in certain categories we offer, particularly in apparel and seasonal merchandise, which could impact our sales, customer satisfaction with our stores, and our markdowns, adversely affecting our business.
In particular, prolonged volatility or significant disruption of global financial markets due in part to the COVID-19 pandemic and Russia’s invasion of Ukraine could have a negative impact on our ability to access capital markets and other funding sources, on acceptable terms or at all, and impede our ability to comply with debt covenants.
In particular, prolonged volatility or significant disruption of global financial markets due in part to the COVID-19 pandemic, the current financial regulatory environment and the ongoing Russia-Ukraine conflict could have a negative impact on our ability to access capital markets and other funding sources, on acceptable terms or at all, and impede our ability to comply with debt covenants.
In addition, because of the distinctive nature of our off-price model, we must provide significant internal training and development for key Associates across the Company, including within our buying organization, and continue to adapt to doing so remotely for the most part, and must effectively manage succession planning.
In addition, because of the distinctive nature of our off-price model, we must provide significant internal training and development, including doing so remotely in some cases, for key Associates across the Company, including within our buying organization, and must effectively manage succession planning.
Our ability to allocate, deliver and maintain our preferred mix and level of inventory has been impacted by temporary store closures and global supply chain disruptions, including, for example, by increasing competition for limited shipping capacity and by other operational and market changes related to the global pandemic.
Our ability to allocate, deliver, and maintain our preferred mix and level of inventory has been impacted in recent years by temporary store closures, inflationary pressures and global supply chain disruptions, including, for example, an increase in competition for limited shipping capacity and other operational and market changes related to the global pandemic.
There is also a risk of material business disruption, liability and reputational damage associated with ongoing actions intended to update, enhance, modify or replace our systems and infrastructure, including from not accurately capturing and maintaining data, efficiently testing and implementing changes, realizing the expected benefit of the change and managing the potential disruption of the actions and diversion of internal teams’ attention as the changes are implemented. 14 Damage to our corporate reputation or those of our retail banners could adversely affect our sales and operating results.
There is also a risk of material business disruption, liability and reputational damage associated with ongoing actions intended to update, enhance, modify or replace our systems and infrastructure, including from not accurately capturing and maintaining data, efficiently testing and implementing changes, realizing the expected benefit of the change and managing the potential disruption of the actions and diversion of internal teams’ attention as the changes are implemented.
New competitors frequently enter the market. Additionally, existing competitors may enter or increase their presence in markets in which we operate, consolidate with other retailers, expand their merchandise offerings, expand their e-commerce capabilities and/or add new sales channels or change their pricing strategies. Consumer e-commerce spending has been increasing over the past few years.
New competitors frequently enter the market. Additionally, existing competitors may enter or increase their presence in markets in which we operate, consolidate with other retailers, expand their merchandise offerings, expand their e-commerce capabilities, and/or add new sales channels or change their pricing strategies.
Food Safety Modernization Act, state regulations like California’s Proposition 65, and similar legislation in other countries in which we operate, impose restrictions and requirements on the merchandise we buy and sell.
Consumer Product Safety Improvement Act of 2008 and the U.S. Food Safety Modernization Act, state regulations like California’s Proposition 65, and similar legislation in other countries in which we operate, impose restrictions and requirements on the merchandise we buy and sell.
Growth can add complexity to effective information sharing and requires significant attention from our management and other functions across our business. It also requires appropriately staffing and training an increased number of Associates and/or managing appropriate third-party providers. These risks may increase with further growth, particularly if we expand into additional countries.
Growth can also add complexity to our business operations by requiring effective information sharing, significant attention from our management and other functions across our business, development of new capabilities, as well as appropriately staffing and training an increased number of Associates and/or managing appropriate third-party providers. These requirements may increase with further growth, particularly if we expand into additional countries.
Certain of our Associates in Europe are members of works councils, which may subject us to additional requirements, actions or expense. Failure to employ quality Associates in appropriate numbers and to retain key Associates and management could adversely affect our performance.
Some of our Associates in Europe are members of works councils, and other portions of our workforce may become unionized, any of which may subject us to additional requirements, expectations, actions or expense. Failure to employ quality Associates in appropriate numbers and to retain key Associates and management could adversely affect our performance.
Legal, regulatory and other proceedings could expose us to significant defense costs, fines, penalties and liability to private parties and governmental entities for monetary recoveries and other amounts and attorneys’ fees and/or require us to change aspects of our operations, any of which could have a material adverse effect on our business and results of operations. 19 Quality, safety or other issues with merchandise we buy and sell could impact our reputation, sales and financial results.
Legal, regulatory and other proceedings could expose us to significant defense costs, fines, penalties and liability to private parties and governmental entities for monetary recoveries and other amounts and attorneys’ fees and/or require us to change aspects of our operations, any of which could have a material adverse effect on our business and results of operations.
E-commerce may continue to increase, while our business is primarily in brick and mortar stores. If we fail to compete effectively, our sales and results of operations could be adversely affected.
More generally, consumer e-commerce spending may continue to increase, as it has in recent years, while our business is primarily in brick and mortar stores. If we fail to compete effectively, our sales and results of operations could be adversely affected.
Although we use marketing to drive customer traffic through various media including television, radio, print, outdoor, digital/social media, email, mobile and direct mail, some of our competitors may expend more for their marketing programs than we do, or use different approaches than we do, which may provide them with a competitive advantage.
Although we use various marketing channels to drive customer traffic, including traditional format linear television, streaming video, audio, outdoor, digital/social media, and mobile, some of our competitors may expend more for their marketing programs than we do, or use different approaches than we do, which may provide them with a competitive advantage.
This reliance requires us to accurately anticipate our current and future IT needs and successfully develop, implement and maintain appropriate systems, as well as effective disaster recovery plans for such systems. Our ongoing operations and successful growth are dependent on doing so, as well as on the ongoing integrity, security and consistent operations of these systems, including related back-up systems.
This reliance requires us to accurately anticipate our current and future IT needs and successfully develop, implement and maintain appropriate systems, as well as effective disaster recovery plans for such systems. Our ongoing operations and successful growth are dependent on our doing these things effectively.
Divestitures, closings and consolidations could involve risks such as significant costs and obligations of closure, including exposure on leases, owned real estate and other contractual, employment, pension and severance obligations, and potential liabilities that may arise under law as a result of the disposition or as a result of the credit risk of an acquirer.
Divestitures, closings and consolidations could involve risks such as significant costs and obligations of closure, including exposure on leases, owned real estate and other contractual, employment, pension and severance obligations, and potential liabilities that may arise under law as a result of the disposition or as a result of the credit risk of an acquirer. 17 Our large number of real estate leases, which generally obligate us for long periods, subject us to potential financial risk.
In addition, when the lease terms for the stores in our ongoing operations expire, we may be unable to negotiate renewals, either on commercially reasonable terms or at all, which could cause us to permanently close stores or to relocate stores within a market on less favorable terms or in a less favorable location. 16 Failure to protect our inventory or other assets from loss and theft may impact our financial results.
In addition, when the lease terms for the stores in our ongoing operations expire, we may be unable to negotiate renewals, either on commercially reasonable terms or at all, which could cause us to permanently close stores or to relocate stores within a market on less favorable terms or in a less favorable location.
If we do not effectively attract qualified individuals, train them in our business model, support their development, engage them in our business, and retain them in sufficient numbers and at appropriate levels of the organization, our growth could be limited, and the successful execution of our business model could be adversely affected.
If we do not effectively attract qualified individuals, train them in our business model, support their development, engage them in our business, and retain them in sufficient numbers and at appropriate levels of the organization, our growth could be limited, and the successful execution of our business model could be adversely affected. 15 Damage to our corporate reputation or those of our retail banners could adversely affect our sales and operating results.
In addition, if we, or third parties that perform services on our behalf, fail to comply with applicable laws, rules, regulations, standards, interpretations and orders, we may be subject to judgments, fines or other costs or penalties, which could adversely affect our operations and our financial results and condition.
In addition, if we, or third parties that perform services on our behalf, fail to comply with applicable laws, rules, regulations, standards, interpretations and orders, we may be subject to judgments, fines or other costs or penalties, which may cause reputational harm and could adversely affect our operations and our financial results and condition. 20 Our results may be materially adversely affected by the outcomes of litigation, legal proceedings and other legal or regulatory matters.
The ongoing COVID-19 pandemic has impacted, and may continue to impact, execution of our opportunistic buying strategy and inventory management.
A variety of factors, including the COVID-19 pandemic, have impacted, and may continue to impact, execution of our opportunistic buying strategy and inventory management.
We have a significant retail presence in countries in Europe and in Canada and Australia. We also operate buying offices around the world. Our goal is to continue to expand our operations into other countries in the future.
Further expansion of our international operations could expose us to risks inherent in operating in new countries. We have a significant retail presence in certain countries in Europe and in Canada and Australia. We also operate buying and other offices around the world. Our goal is to continue to expand our operations into other countries in the future.
Day-to-day operations, including our ability to receive products from our vendors or third-party service providers or transport products to our stores or to our e-commerce customers could be adversely affected, transportation to and from our stores (by customers or Associates) could be limited, or we could temporarily close stores or distribution centers in the affected areas or in areas served by affected distribution centers for a short or extended period of time (as with closures of our stores and other facilities at various times due to the COVID-19 pandemic). 17 As our business is subject to seasonal influences, a decrease in sales or margins, a severe disruption or other significant event that impacts our business during the second half of the year could have a disproportionately adverse effect on our operating results.
Day-to-day operations, including our ability to receive products from our vendors or third-party service providers or transport products to our stores or to our e-commerce customers could be adversely affected, transportation to and from our stores (by customers or Associates) could be limited, or we could temporarily close stores or distribution centers in the affected areas or in areas served by affected distribution centers for a short or extended period of time (as with closures of our stores and other facilities at various times due to the COVID-19 pandemic).
Changes in the business landscape and the increase of remote working for our Associates, service providers and other third parties have the potential to increase the likelihood of system damage or disruption and increase the risk of a data security compromise. These factors have led to additional mitigation strategies and investments across our IT Security workforce, technologies and processes.
Changes in the business landscape and the increase of remote working by our Associates, service providers and other third parties have the potential to increase the likelihood of system damage or disruption and increase the risk of a data security compromise.
In response to the COVID-19 pandemic we also implemented new practices and protocols in our operations, including enhanced cleaning protocols, occupancy limitations and additional health and safety protocols that resulted in additional payroll and continued or increased expenses while potentially impacting sales opportunities.
During that time, we also implemented new procedures in our operations, including enhanced cleaning protocols, occupancy limitations, and additional health and safety protocols that resulted in additional payroll and continued or increased expenses primarily during fiscal 2021 and fiscal 2022, while potentially impacting sales opportunities.
Any of these factors could increase our labor costs (and the labor costs of our service providers, which could be passed on to us). Increased labor costs may adversely affect our results of operations.
Any of these factors could increase, and have in the past increased, our labor costs (and the labor or other costs of our service providers, which could be passed on to us).
We may acquire new businesses (as we have in the past with our Australia business and with Sierra), invest in other businesses (as we did with our minority investment interest in privately held Familia, a Russian off-price apparel and home fashions retailer, in fiscal 2020) or enter into joint ventures with other businesses, develop new businesses internally (as with Homesense, our additional U.S. home store concept launched in fiscal 2018), launch or expand e-commerce platforms (as we did in fiscal 2022 with homegoods.com, a HomeGoods e-commerce business), and divest (as we plan to do with our Familia interest), close or consolidate businesses.
We may acquire new businesses, as we have in the past, invest in other businesses or enter into joint ventures with other businesses, develop new businesses internally (as with Homesense, our second U.S. home store concept), launch or expand e-commerce platforms (as we did in fiscal 2022 with homegoods.com), and divest (as we did in fiscal 2023 with our minority interest in Familia), close or consolidate businesses.
Furthermore, we may not be able to strategically divest certain assets or investments due to developments outside of our control. Failure to execute on mergers, acquisitions, investments, divestitures, closings and consolidations in a satisfactory manner could adversely affect our future results of operations and financial condition.
Failure to execute on mergers, acquisitions, investments, divestitures, closings and consolidations in a satisfactory manner, including due to circumstances outside our control, could adversely affect our future results of operations and financial condition.
Changes in the capital and credit markets, including market disruptions, limited liquidity and interest rate fluctuations, may increase the cost of financing or restrict our access to these potential sources of liquidity. Our continued access to these liquidity sources on favorable terms depends on multiple factors, including our operating performance and maintaining strong credit ratings.
Changes in the capital and credit markets, including market disruptions, limited liquidity and interest rate fluctuations, have in the past, and may continue to, increase the cost of financing or restrict our access to these potential sources of liquidity.
If we are unable to manage our size and scale effectively, our results of operations may be adversely affected. We source our merchandise globally, which subjects us to risks, including when moving merchandise internationally. We are subject to various risks of sourcing merchandise, particularly from other countries, including risks related to moving merchandise internationally.
We source our merchandise globally, which subjects us to risks, including when moving merchandise internationally. We are subject to various risks of sourcing merchandise, particularly from other countries, including risks related to moving merchandise internationally.
We regularly assess the likely outcomes of these proceedings to determine the adequacy and appropriateness of our provision for income taxes, and we increase and decrease our provision as a result of these assessments.
We are engaged in various proceedings, which are at various stages, with such authorities with respect to assessments, claims, deficiencies, and refunds. We regularly assess the likely outcomes of these proceedings to determine the adequacy and appropriateness of our provision for income taxes, and we increase and decrease our provision as a result of these assessments.
Various governmental authorities in the jurisdictions where we do business regulate the quality and safety of the merchandise we import, transport and sell to consumers. Regulations and standards in this area, including federal regulations related to the U.S. Consumer Product Safety Improvement Act of 2008 and the U.S.
Quality, safety or other issues with merchandise we buy and sell could impact our reputation, sales and financial results. Various governmental authorities in the jurisdictions where we do business regulate the quality and safety of the merchandise we import, transport and sell to consumers. Regulations and standards in this area, including federal regulations related to the U.S.
Risk of loss or theft of assets, including inventory shrinkage, is inherent in the retail business. Loss may be caused by error or misconduct of Associates, customers, vendors or other third parties including through organized retail crime and professional theft.
Loss may be caused by error or misconduct of Associates, customers, vendors or other third parties including through organized retail crime and professional theft, and may be further impacted by macroeconomic factors, including the enforcement environment.
For example, a significant amount of merchandise we offer for sale is made in China and accordingly, a revaluation of Chinese currency, or increased market flexibility in the exchange rate for that currency, increasing its value relative to the U.S. dollar or currencies in which our stores are located, could be significant.
For example, a significant amount of merchandise we offer for sale is made in China and accordingly, a revaluation of Chinese currency, or increased market flexibility in the exchange rate for that currency, increasing its value relative to the U.S. dollar or currencies in which our stores are located, could be significant. 19 Additionally, we routinely enter into inventory-related derivative instruments (a hedging strategy) to mitigate the impact of currency exchange rates on merchandise margins resulting from merchandise purchases by our segments denominated in currencies other than their local currencies.
If our merchandise is not generally purchased at prices sufficiently below prices paid by conventional retailers, we may not be able to maintain an adequate overall pricing differential to full-price retailers, including department, specialty and major online retailers, at various times or in some reporting segments, banners, product categories or geographies. 10 In addition, to respond to customer demand and effectively manage pricing and markdowns, we need to appropriately allocate and deliver merchandise to our stores, maintain an appropriate mix and level of inventory in each store and be flexible in our allocation of floor space at our stores among product categories.
If our merchandise is not generally purchased at prices sufficiently below prices paid by conventional retailers, we may not be able to maintain our desired overall pricing differential to full-price retailers, including department, specialty, and major online retailers, at various times or in some reporting segments, banners, product categories or geographies.
For example, in connection with the ongoing conflict between Russia and Ukraine, we announced our intention to divest our ownership interest in Familia. Depending on how and when that divestment occurs, we may not recover the full value of our investment.
For example, in connection with the ongoing conflict between Russia and Ukraine, we divested our minority ownership interest in Familia and did not recover the full value of our investment.
Customers may also have expectations about how they shop in stores or through e-commerce or more generally engage with businesses across different channels (for example, through various digital platforms).
Customers may also have expectations about how they shop in stores or through e-commerce or more generally engage with businesses across different channels (for example, through various digital platforms). These expectations may vary both across and within demographics and geographies and may evolve rapidly or be impacted by external factors, including the COVID-19 pandemic.
Our inability to effectively prevent and/or minimize the loss or theft of assets, or to effectively reduce the impact of those losses, could adversely affect our financial performance.
Our inability to effectively prevent and/or minimize the loss or theft of assets, or to effectively reduce, or to accurately predict and accrue for the impact of those losses, could adversely affect our financial performance, including in particular reporting periods, as it did for part of fiscal 2023.
Our results may be materially adversely affected by the outcomes of litigation, legal proceedings and other legal or regulatory matters. We are involved, or may in the future become involved, in legal proceedings, regulatory reviews, audits and other legal matters.
We are involved in, and may in the future become involved in, legal proceedings, regulatory reviews, audits and other legal matters.
Such increases can impact the cost of merchandise, which could adversely affect our performance through potentially reduced consumer demand or reduced margins. Adverse or unseasonable weather may adversely affect our sales and operating results.
Such increases can impact the cost of merchandise, which could adversely affect our performance through potentially reduced consumer demand or reduced margins. Fluctuations in currency exchange rates may lead to lower revenues and earnings.
We expect that currency exchange rate fluctuations could have a material adverse effect on our sales and results of operations from time to time.
These adjustments are of a much greater magnitude when there is significant volatility in currency exchange rates and may have a significant impact on our earnings. We expect that currency exchange rate fluctuations could have a material adverse effect on our sales and results of operations from time to time.
Any successful compromise or disruption of our IT systems, or other compromise of the information of our customers, Associates or other persons that we collect, could result in material reputational harm and impact our customers’ willingness to shop in our stores or online and/or our suppliers’, service providers’ or other third parties’ willingness to do business with us.
Any successful compromise or disruption of our IT systems, or other compromise of the information that we collect or is collected on our behalf from our customers, Associates or other persons, could result in material reputational harm and impact our customers’ willingness to shop in our stores or online, and could affect our suppliers’, service providers’ or other third parties’ willingness to do business with us. 14 We maintain policies, procedures and controls designed to reduce the risks of data security compromises and IT failures or disruptions, but such controls cannot fully eliminate these risks and may fail to operate as intended or be circumvented.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeSome of the Company's leases have options to terminate prior to the lease expiration date. 20 STORE LOCATIONS Stores are operated in the following locations at the end of fiscal 2022 and counts include both banners within a combo or a superstore: United States Marmaxx (a) Sierra HomeGoods (a) Total Alabama 33 — 9 42 Arizona 37 — 14 51 Arkansas 18 — 5 23 California 269 — 96 365 Colorado 30 8 12 50 Connecticut 51 1 20 72 Delaware 8 — 6 14 District of Columbia 7 — — 7 Florida 196 — 75 271 Georgia 87 — 31 118 Hawaii 8 — — 8 Idaho 9 1 2 12 Illinois 99 4 33 136 Indiana 41 — 10 51 Iowa 17 — 6 23 Kansas 17 — 7 24 Kentucky 23 — 7 30 Louisiana 29 — 10 39 Maine 12 1 3 16 Maryland 56 1 24 81 Massachusetts 109 2 41 152 Michigan 71 4 22 97 Minnesota 35 7 15 57 Mississippi 16 — 5 21 Missouri 37 — 12 49 Montana 6 — 1 7 Nebraska 10 1 5 16 Nevada 20 1 7 28 New Hampshire 26 5 14 45 New Jersey 92 4 53 149 New Mexico 10 — 3 13 New York 169 2 63 234 North Carolina 66 — 23 89 North Dakota 6 — 2 8 Ohio 86 1 25 112 Oklahoma 19 — 5 24 Oregon 24 3 8 35 Pennsylvania 96 1 37 134 Puerto Rico 29 — 6 35 Rhode Island 12 — 6 18 South Carolina 36 — 12 48 South Dakota 3 — 1 4 Tennessee 48 — 16 64 Texas 170 — 61 231 Utah 19 2 8 29 Vermont 7 1 1 9 Virginia 68 2 30 100 Washington 41 2 17 60 West Virginia 11 — 4 15 Wisconsin 38 3 16 57 Wyoming 5 2 — 7 Total Stores 2,432 59 889 3,380 (a) Marmaxx operates T.J.
Biggest changeCounts include both banners within a combo or a superstore: United States Marmaxx (a) Sierra HomeGoods (a) Total Alabama 34 — 12 46 Arizona 38 — 15 53 Arkansas 18 — 5 23 California 271 — 99 370 Colorado 30 9 12 51 Connecticut 51 1 21 73 Delaware 8 — 6 14 District of Columbia 6 — — 6 Florida 200 — 78 278 Georgia 92 — 31 123 Hawaii 8 — — 8 Idaho 9 1 3 13 Illinois 99 5 34 138 Indiana 42 — 12 54 Iowa 18 — 6 24 Kansas 19 1 7 27 Kentucky 27 1 7 35 Louisiana 29 — 10 39 Maine 12 1 5 18 Maryland 56 1 26 83 Massachusetts 109 2 40 151 Michigan 73 5 23 101 Minnesota 35 8 16 59 Mississippi 17 — 5 22 Missouri 37 — 13 50 Montana 6 — 1 7 Nebraska 10 1 5 16 Nevada 20 1 7 28 New Hampshire 28 5 15 48 New Jersey 91 4 55 150 New Mexico 10 1 3 14 New York 170 4 65 239 North Carolina 68 — 23 91 North Dakota 6 1 2 9 Ohio 88 4 27 119 Oklahoma 20 — 6 26 Oregon 25 3 10 38 Pennsylvania 99 2 37 138 Puerto Rico 29 — 6 35 Rhode Island 12 — 6 18 South Carolina 36 — 14 50 South Dakota 4 — 1 5 Tennessee 51 — 16 67 Texas 175 — 68 243 Utah 19 4 10 33 Vermont 8 1 1 10 Virginia 70 4 37 111 Washington 42 2 17 61 West Virginia 11 — 5 16 Wisconsin 41 4 17 62 Wyoming 5 2 — 7 Total Stores 2,482 78 940 3,500 (a) Marmaxx operates T.J.
Additionally, we own and lease additional office space throughout the United States and in various countries. As of January 29, 2022, TJX owned and leased a combined 3.2 million square feet of office space, primarily within the United States. Square footage information for office space represents total space owned or leased. 22
Additionally, we own and lease additional office space throughout the United States and in various countries. As of January 28, 2023, TJX owned and leased a combined 3.3 million square feet of office space, primarily within the United States. Square footage information for office space represents total space owned or leased. 24
Maxx Australian Capital Territory 4 New South Wales 21 Queensland 24 Victoria 18 South Australia 1 Total Stores 68 DISTRIBUTION CENTERS The following is a summary of our primary owned and leased distribution and fulfillment centers as of January 29, 2022. Square footage information for the distribution and fulfillment centers represents total “ground cover” of the facility.
Maxx Australian Capital Territory 4 New South Wales 23 Queensland 26 Victoria 19 South Australia 2 Total Stores 74 DISTRIBUTION CENTERS The following is a summary of our primary owned and leased distribution and fulfillment centers as of January 28, 2023. Square footage information for the distribution and fulfillment centers represents total “ground cover” of the facility.
HomeGoods operates HomeGoods and Homesense. 21 Canada Winners HomeSense Marshalls Total Alberta 42 21 17 80 British Columbia 40 22 9 71 Manitoba 9 5 5 19 New Brunswick 4 3 4 11 Newfoundland 3 2 2 7 Nova Scotia 11 3 2 16 Ontario 125 66 49 240 Prince Edward Island 1 1 — 2 Quebec 52 21 15 88 Saskatchewan 6 3 3 12 Total Stores 293 147 106 546 Europe T.K.
HomeGoods operates HomeGoods and Homesense. 23 Canada Winners HomeSense Marshalls Total Alberta 43 21 17 81 British Columbia 40 22 9 71 Manitoba 9 5 5 19 New Brunswick 4 3 4 11 Newfoundland 3 2 2 7 Nova Scotia 11 3 2 16 Ontario 126 69 49 244 Prince Edward Island 1 1 — 2 Quebec 54 21 15 90 Saskatchewan 6 4 3 13 Total Stores 297 151 106 554 Europe T.K.
Square footage in thousands Owned (sq/ft) Count Leased (sq/ft) Count Total (sq/ft) Total Count Marmaxx 7,372 8 4,666 8 12,038 16 HomeGoods 4,518 5 1,626 2 6,144 7 Sierra 780 1 742 1 1,522 2 TJX Canada — — 2,240 5 2,240 5 TJX International — — 2,415 8 2,415 8 Total 12,670 14 11,689 24 24,359 38 OFFICE SPACE TJX has corporate headquarters in Massachusetts which consists of both owned and leased space.
Square footage in millions Owned (sq/ft) Count Leased (sq/ft) Count Total (sq/ft) Total Count Marmaxx 9 9 4 8 13 17 HomeGoods 4 5 2 2 6 7 Sierra 1 1 1 1 2 2 TJX Canada — — 2 4 2 4 TJX International — — 3 8 3 8 Total 14 15 12 23 26 38 OFFICE SPACE TJX has corporate headquarters in Massachusetts which consists of both owned and leased space.
Maxx Homesense Total United Kingdom 352 75 427 Republic of Ireland 27 2 29 Germany 163 — 163 Poland 49 — 49 Austria 14 — 14 The Netherlands 13 — 13 Total Stores 618 77 695 Australia T.K.
Maxx Homesense Total United Kingdom 351 76 427 Republic of Ireland 27 2 29 Germany 166 — 166 Poland 52 — 52 Austria 18 — 18 The Netherlands 15 — 15 Total Stores 629 78 707 Australia T.K.
Added
Some of the Company's leases have options to terminate prior to the lease expiration date. 22 STORE LOCATIONS Stores were operated in the following locations at the end of fiscal 2023.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeINFORMATION ON SHARE REPURCHASES The number of shares of common stock repurchased by TJX during the fourth quarter of fiscal 2022 and the average price paid per share are as follows: Total Number of Shares Repurchased (a) Average Price Paid Per Share (b) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (c) Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (c) October 31, 2021 through November 27, 2021 3,209,011 $ 70.12 3,209,011 $ 1,660,688,807 November 28, 2021 through January 1, 2022 6,520,102 $ 72.85 6,520,102 $ 1,185,686,217 January 2, 2022 through January 29, 2022 5,480,810 $ 71.50 5,480,810 $ 3,793,793,398 Total 15,209,923 15,209,923 (a) Consists of shares repurchased under publicly announced stock repurchase programs.
Biggest changeINFORMATION ON SHARE REPURCHASES The number of shares of common stock repurchased by TJX during the fourth quarter of fiscal 2023 and the average price paid per share are as follows: Total Number of Shares Repurchased (a) Average Price Paid Per Share (b) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (c) Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (c) October 30, 2022 through November 26, 2022 1,207,147 $ 74.56 1,207,147 $ 1,903,792,649 November 27, 2022 through December 31, 2022 3,226,241 $ 79.04 3,226,241 $ 1,648,792,687 January 1, 2023 through January 28, 2023 1,294,774 $ 81.10 1,294,774 $ 3,543,792,734 Total 5,728,162 5,728,162 (a) Consists of shares repurchased under publicly announced stock repurchase programs.
ITEM 5. Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is listed on the New York Stock Exchange (Symbol: TJX). The approximate number of common shareholders of record at January 29, 2022 was 1,984.
ITEM 5. Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is listed on the New York Stock Exchange (Symbol: TJX). The approximate number of common shareholders of record at January 28, 2023 was 1,933.
(b) Includes commissions for the shares repurchased under stock repurchase programs. (c) In February 2022, we announced that our Board of Directors had approved a new stock repurchase program that authorizes the repurchase of up to an additional $3.0 billion of our common stock from time to time.
(b) Includes commissions for the shares repurchased under stock repurchase programs. (c) In February 2023, we announced that our Board of Directors had approved a new stock repurchase program that authorized the repurchase of up to an additional $2 billion of our common stock from time to time.
Under this program and previously announced programs, we had approximately $3.8 billion available for repurchase as of January 29, 2022. ITEM 6. Reserved 23
Under this program and previously announced programs, we had approximately $3.5 billion available for repurchase as of January 28, 2023. ITEM 6. Reserved 25

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeAs of January 29, 2022, the number of stores in operation increased approximately 3% and selling square footage increased 2% compared to the end of fiscal 2021. – Diluted earnings per share were $2.70 for fiscal 2022, which included a debt extinguishment charge of $0.15 per share, compared to $0.07 for fiscal 2021, which included a debt extinguishment charge of $0.19 per share, and $2.67 for fiscal 2020. – Pre-tax margin (the ratio of pre-tax income to net sales) was 9.1%, 0.3%, and 10.6% for fiscal 2022, fiscal 2021, and fiscal 2020, respectively. – A debt extinguishment charge of $0.2 billion reduced fiscal 2022 pre-tax margin by 0.5 percentage points and a debt extinguishment charge of $0.3 billion reduced fiscal 2021 pre-tax margin by 1.0 percentage point. – Our cost of sales, including buying and occupancy costs, ratio was 71.5%, 76.3%, and 71.5% for fiscal 2022, fiscal 2021, and fiscal 2020, respectively. 24 – Our selling, general and administrative (“SG&A”) expense ratio was 18.7%, 21.8%, and 17.9% for fiscal 2022, fiscal 2021, and fiscal 2020, respectively. – Our consolidated average per store inventories, including inventory on hand at our distribution centers (which excludes inventory in transit) and excluding our e-commerce sites and Sierra stores, were up 31% on a reported basis and 32% on a constant currency basis at the end of fiscal 2022 as compared to fiscal 2021, and we were up 3% on both a reported basis and constant currency basis at the end of fiscal 2022 as compared to fiscal 2020. – During fiscal 2022, we returned $3.4 billion to our shareholders through share repurchases and dividends.
Biggest changeThis was a 0.2 percentage point increase compared to 9.1% for fiscal 2022, which included a 0.5 percentage point debt extinguishment charge. – Our cost of sales, including buying and occupancy costs, ratio for fiscal 2023 was 72.4%, a 0.9 percentage point increase compared to 71.5% for fiscal 2022. – Our selling, general and administrative (“SG&A”) expense ratio for fiscal 2023 was 17.9%, a 0.8 percentage point decrease compared to 18.7% for fiscal 2022. – Our consolidated average per store inventories, including inventory on hand at our distribution centers (which excludes inventory in transit) and excluding our e-commerce sites and Sierra stores, were up 1% on a reported basis and up 2% on a constant currency basis at the end of fiscal 2023 as compared to the prior year. – During fiscal 2023, we returned $3.6 billion to our shareholders through share repurchases and dividends.
In addition to our four main segments, Sierra operates sierra.com and retail stores in the U.S. The results of Sierra are included in the Marmaxx segment.
In addition to our four main segments, Sierra operates retail stores and sierra.com in the U.S. The results of Sierra are included in the Marmaxx segment.
RECENT ACCOUNTING PRONOUNCEMENTS For a discussion of any new accounting pronouncements, see Note A—Basis of Presentation and Summary of Accounting Policies of Notes to Consolidated Financial Statements included in this annual report on Form 10-K. We do not expect any recently issued accounting pronouncements will have a material effect on our consolidated financial statements.
RECENT ACCOUNTING PRONOUNCEMENTS For a discussion of any new accounting pronouncements, see Note A—Basis of Presentation and Summary of Accounting Policies of Notes to Consolidated Financial Statements included in this annual report on Form 10-K. We do not expect any recently issued accounting pronouncements will have a material effect on our consolidated financial statements. 37
The mark-to-market adjustment on these derivatives does not affect net sales, but it does affect the cost of sales, operating margins and earnings we report. Transactional Foreign Exchange When discussing the impact on our results of the effect of foreign currency exchange rates on certain transactions, we refer to it as “transactional foreign exchange”.
The mark-to-market adjustment on these derivatives does not affect net sales, but it does affect the cost of sales, operating margins and earnings we report. 28 Transactional Foreign Exchange When discussing the impact on our results of the effect of foreign currency exchange rates on certain transactions, we refer to it as “transactional foreign exchange”.
The method for calculating comp sales varies across the retail industry, therefore our measure of comp sales may not be comparable to that of other retail companies. We define customer traffic to be the number of transactions in stores and average ticket to be the average retail price of the units sold.
The method for calculating comp store sales varies across the retail industry, therefore our measure of comp store sales may not be comparable to that of other retail companies. We define customer traffic to be the number of transactions in stores and average ticket to be the average retail price of the units sold.
We calculated comp sales on a 52-week basis by comparing the current and prior year weekly periods that are most closely aligned. Relocated stores and stores that have changed in size are generally classified in the same way as the original store, and we believe that the impact of these stores on the consolidated comp percentage is immaterial.
We calculate comp store sales on a 52-week basis by comparing the current and prior year weekly periods that are most closely aligned. Relocated stores and stores that have changed in size are generally classified in the same way as the original store, and we believe that the impact of these stores on the consolidated comp percentage is immaterial.
Operating lease liabilities exclude legally binding minimum lease payments for approximately 170 leases signed but not yet commenced and include options to extend lease terms that are now deemed reasonably certain of being exercised according to our Lease Accounting Policy.
Operating lease liabilities exclude legally binding minimum lease payments for approximately 180 leases signed but not yet commenced and include options to extend lease terms that are now deemed reasonably certain of being exercised according to our Lease Accounting Policy.
This removes the effect of changes in currency exchange rates, which we believe is a more accurate measure of segment operating performance. Comp sales may be referred to as “same store” sales by other retail companies.
This removes the effect of changes in currency exchange rates, which we believe is a more accurate measure of segment operating performance. 27 Comp store sales may be referred to as “same store” sales by other retail companies.
The businesses that utilize the retail method have some inventory that is initially valued at cost before the retail method is applied as it has not been fully processed for sale (i.e. inventory in transit and unprocessed inventory in our distribution centers).
Maxx in Australia. The businesses that utilize the retail method have some inventory that is initially valued at cost before the retail method is applied as it has not been fully processed for sale (i.e. inventory in transit and unprocessed inventory in our distribution centers).
If we use our operating cash flow and/or cash on hand to repay our debt, it will reduce the amount of cash available for additional capital expenditures. Operating Activities Net cash provided by operating activities was $3.1 billion in fiscal 2022 and $4.6 billion in fiscal 2021.
If we use our operating cash flow and/or cash on hand to repay our debt, it will reduce the amount of cash available for additional capital expenditures. Operating Activities Net cash provided by operating activities was $4.1 billion in fiscal 2023 and $3.1 billion in fiscal 2022.
We have provided for all applicable state and foreign withholding taxes on all undistributed earnings of our foreign subsidiaries in Canada, Puerto Rico, Italy, India, Hong Kong and Vietnam through January 29, 2022. If we repatriate cash from such subsidiaries, we should not incur additional tax expense and our cash would be reduced by the amount of withholding taxes paid.
We have provided for all applicable state and foreign withholding taxes on all undistributed earnings of our foreign subsidiaries in Canada, Puerto Rico, Italy, India, Hong Kong and Vietnam through January 28, 2023. If we repatriate cash from such subsidiaries, we should not incur additional tax expense and our cash would be reduced by the amount of withholding taxes paid.
This does not include the impact foreign currency exchange rates can have on various transactions that are denominated in a currency other than an operating division’s local currency referred to as “transactional foreign exchange,” also described below.
This does not include the impact foreign currency exchange rates can have on various transactions that are denominated in a currency other than an operating division’s local currency, which is referred to as “transactional foreign exchange,” and also described below.
We plan to fund these expenditures with our existing cash balances and through internally generated funds. Financing Activities Net cash used in financing activities resulted in net cash outflows of $6.2 billion in fiscal 2022 compared to net cash inflows of $3.2 billion in fiscal 2021.
We plan to fund these expenditures with our existing cash balances and through internally generated funds. Financing Activities Net cash used in financing activities resulted in net cash outflows of $3.3 billion in fiscal 2023 compared to net cash outflows of $6.2 billion in fiscal 2022.
Discussions of fiscal 2020 items and year-to-year comparisons between fiscal 2021 and fiscal 2020 that are not included in this Form 10-K can be found in “Management's Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our annual report on Form 10-K for the fiscal year ended January 30, 2021.
Discussions of fiscal 2021 items and year-to-year comparisons between fiscal 2022 and fiscal 2021 that are not included in this Form 10-K can be found in “Management's Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our annual report on Form 10-K for the fiscal year ended January 29, 2022.
A dividend of $0.26 per share was declared in the fourth quarter of fiscal 2022 and paid in March of 2022. Operating Results as a Percentage of Net Sales The following table sets forth our consolidated operating results as a percentage of net sales.
A dividend of $0.295 per share was declared in the fourth quarter of fiscal 2023 and paid in March 2023. 26 Operating Results as a Percentage of Net Sales The following table sets forth our consolidated operating results as a percentage of net sales.
We operate nearly 4,700 stores through our four main segments: in the U.S., Marmaxx (which operates T.J. Maxx, Marshalls, tjmaxx.com and marshalls.com) and HomeGoods (which operates HomeGoods, Homesense, and homegoods.com); TJX Canada (which operates Winners, HomeSense and Marshalls in Canada); and TJX International (which operates T.K. Maxx, Homesense and tkmaxx.com in Europe, and T.K. Maxx in Australia).
We operate over 4,800 stores through our four main segments: in the U.S., Marmaxx (which operates T.J. Maxx, Marshalls, tjmaxx.com and marshalls.com) and HomeGoods (which operates HomeGoods, Homesense, and homegoods.com); TJX Canada (which operates Winners, HomeSense and Marshalls in Canada); and TJX International (which operates T.K. Maxx, Homesense and tkmaxx.com in Europe, and T.K. Maxx in Australia).
Sales excluded from comp sales (“non-comp sales”) consist of sales from: – New stores - stores that have not yet met the comp sales criteria, which represents a substantial majority of non-comp sales – Stores that are closed permanently or for an extended period of time – Sales from our e-commerce sites, meaning sierra.com, tjmaxx.com, marshalls.com, homegoods.com and tkmaxx.com We determine which stores are included in the comp sales calculation at the beginning of a fiscal year and the classification remains constant throughout that year unless a store is closed permanently or for an extended period during that fiscal year.
Sales excluded from comp store sales (“non-comp store sales”) consist of sales from: – New stores - stores that have not yet met the comp store sales criteria, which represents a substantial majority of non-comp store sales – Stores that are closed permanently or for an extended period of time – Sales from our e-commerce sites We determine which stores are included in the comp store sales calculation at the beginning of a fiscal year and the classification remains constant throughout that year unless a store is closed permanently or for an extended period during that fiscal year.
We believe our existing cash and cash equivalents, internally generated funds and our credit facilities, under which facilities we have $1.5 billion available as of the period ended January 29, 2022, as described in Note J—Long-Term Debt and Credit Lines of Notes to Consolidated Financial Statements, are adequate to meet our operating needs for the foreseeable future.
We believe our existing cash and cash equivalents, internally generated funds and our credit facilities, under which facilities we had $1.5 billion available as of the period ended January 28, 2023, as described in Note J—Long-Term Debt and Credit Lines of Notes to Consolidated Financial Statements, are adequate to meet our operating needs for the foreseeable future.
Revenues by Geography The percentages of our consolidated revenues by geography for the last three fiscal years are as follows: Fiscal 2022 Fiscal 2021 Fiscal 2020 United States: Northeast 23 % 23 % 23 % Midwest 13 13 13 South (including Puerto Rico) 27 27 25 West 16 16 15 Total United States 79 % 79 % 76 % Canada 9 9 10 Europe 11 11 13 Australia 1 1 1 Total TJX 100 % 100 % 100 % Impact of Foreign Currency Exchange Rates Our operating results are affected by foreign currency exchange rates as a result of changes in the value of the U.S. dollar or a division’s local currency in relation to other currencies.
Revenues by Geography The percentages of our consolidated revenues by geography for the last two fiscal years are as follows: Fiscal 2023 Fiscal 2022 United States: Northeast 22 % 23 % Midwest 13 13 South (including Puerto Rico) 27 27 West 15 16 Total United States 77 % 79 % Canada 10 9 Europe 12 11 Australia 1 1 Total TJX 100 % 100 % Impact of Foreign Currency Exchange Rates Our operating results are affected by foreign currency exchange rates as a result of changes in the value of the U.S. dollar or a division’s local currency in relation to other currencies.
Historical Comparable Store Sales Historically, we defined comparable store sales, or comp sales, to be sales of 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.
Definition of Comparable Store Sales We define comparable store sales, or comp store sales, to be sales of 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.
As of January 29, 2022, approximately $3.8 billion remained available under our existing stock repurchase programs. For further information regarding equity repurchases, see Note D—Capital Stock and Earnings Per Share of Notes to Consolidated Financial Statements.
As of January 28, 2023, approximately $3.5 billion remained available under our existing stock repurchase programs. For further information regarding equity repurchases, see Note D—Capital Stock and Earnings Per Share of Notes to Consolidated Financial Statements.
In fiscal 2022, the cash outflows were primarily driven by debt repayments, equity repurchases and dividend payments. In fiscal 2021, the cash inflows were primarily driven by debt transactions. Debt The cash outflows in fiscal 2022 were due to the completion of make-whole calls and the redemption at par of certain of our notes.
In fiscal 2022 the cash outflows were primarily driven by equity repurchases, dividend payments and $3 billion of debt repayments. 35 Debt The cash outflows in fiscal 2022 were due to the completion of make-whole calls and the redemption at par of certain of our notes.
We define average transaction or average basket to be the average dollar value of transactions. 26 Open-Only Comp Store Sales Due to the temporary closing of stores as a result of the COVID-19 pandemic, our historical definition of comp store sales is not applicable for the reported periods.
We define average transaction or average basket to be the average dollar value of transactions. Open-Only Comp Store Sales Due to the temporary closing of stores as a result of the COVID-19 pandemic, our historical definition of comp store sales was not applicable for fiscal 2022.
The balances do not include variable costs for insurance, real estate taxes, other operating expenses and, in some cases, rentals based on a percentage of sales; these items totaled approximately one-third of the total minimum rent for fiscal 2022. – See Note M—Accrued Expenses and Other Liabilities, Current and Long Term of Notes to Consolidated Financial Statements for long-term liabilities for which it is not reasonably possible for us to predict when they may be paid, which includes $0.6 billion for employee compensation and benefits and $0.3 billion for uncertain tax positions. – We also have non-cancellable purchase obligations under purchase orders for merchandise and under agreements for capital items, products and services used in our business, including executive employment and other agreements.
The balances do not include variable costs for insurance, real estate taxes, other operating expenses and, in some cases, rentals based on a percentage of sales; these items totaled approximately one-third of the total minimum rent for fiscal 2023. – See Note M—Accrued Expenses and Other Liabilities, Current and Long Term of Notes to Consolidated Financial Statements for long-term liabilities for which it is not reasonably possible for us to predict when they may be paid, which includes $0.6 billion for employee compensation and benefits and $0.2 billion for uncertain tax positions. – We also have non-cancellable purchase obligations under purchase orders for merchandise and under agreements for capital items, products and services used in our business, including executive employment and other agreements. 36 CRITICAL ACCOUNTING ESTIMATES We prepare our consolidated financial statements in accordance with GAAP which requires us to make certain estimates and judgments that impact our reported results.
During fiscal 2022 we have used, and in the future we may use, operating cash flow and cash on hand to repay portions of our indebtedness, depending on prevailing market conditions, liquidity requirements, existing economic conditions, contractual restrictions and other factors.
In fiscal 2024, we intend to use and in the future we may continue to use, operating cash flow and cash on hand to repay portions of our indebtedness, depending on prevailing market conditions, liquidity requirements, existing economic conditions, contractual restrictions and other factors.
Within merchandise margin, strong markon and lower markdowns collectively more than offset incremental freight costs. Our Marmaxx e-commerce sites, tjmaxx.com and marshalls.com, together with sierra.com, represented less than 3% of Marmaxx’s net sales for fiscal 2022, fiscal 2021 and fiscal 2020 and did not have a significant impact on year-over-year segment margin comparisons.
Within merchandise margin, incremental freight costs, higher markdowns and shrink expense were partially offset by strong markon. Our Marmaxx e-commerce sites, tjmaxx.com and marshalls.com, together with sierra.com, represented less than 3% of Marmaxx’s net sales for fiscal 2023 and fiscal 2022 and did not have a significant impact on year-over-year segment margin comparisons.
The discussion that follows relates to our 52-week fiscal years ended January 29, 2022 (fiscal 2022), January 30, 2021 (fiscal 2021), February 1, 2020 (fiscal 2020) and January 28, 2023 (fiscal 2023). The following is a discussion of our consolidated operating results, followed by a discussion of our segment operating results.
The discussion that follows relates to our 52-week fiscal years ended January 28, 2023 (fiscal 2023) and January 29, 2022 (fiscal 2022) and our 53-week fiscal year ended February 3, 2024 (fiscal 2024). The following is a discussion of our consolidated operating results, followed by a discussion of our segment operating results.
In January 2022, the Board of Directors approved a new stock repurchase program that authorizes the repurchase of up to an additional $3.0 billion of our common stock from time to time. We currently plan to repurchase approximately $2.25 billion to $2.5 billion of stock under our stock repurchase programs in fiscal 2023.
In February 2023, the Board of Directors announced a new stock repurchase program that authorizes the repurchase of up to an additional $2 billion of our common stock from time to time. We currently plan to repurchase approximately $2 billion to $2.5 billion of stock under our stock repurchase programs in fiscal 2024.
These outflows for both periods were partially offset by proceeds from the exercise of employee stock options, net of shares withheld for taxes, of $0.2 billion in both fiscal 2022 and fiscal 2021.
These outflows for both periods were partially offset by proceeds from the exercise of employee stock options of $0.3 billion in fiscal 2023 and $0.2 billion in fiscal 2022.
Percentage of Net Sales Fiscal 2022 Fiscal 2021 Fiscal 2020 Net sales 100.0 % 100.0 % 100.0 % Cost of sales, including buying and occupancy costs 71.5 76.3 71.5 Selling, general and administrative expenses 18.7 21.8 17.9 Loss on early extinguishment of debt 0.5 1.0 — Interest expense, net 0.2 0.6 — Income before income taxes * 9.1 % 0.3 % 10.6 % * Figures may not foot due to rounding.
Percentage of Net Sales Fiscal 2023 Fiscal 2022 Net sales 100.0 % 100.0 % Cost of sales, including buying and occupancy costs 72.4 71.5 Selling, general and administrative expenses 17.9 18.7 Impairment on equity investment 0.4 — Loss on early extinguishment of debt — 0.5 Interest expense, net 0.0 0.2 Income before income taxes * 9.3 % 9.1 % * Figures may not foot due to rounding.
As of January 29, 2022, we held $6.2 billion in cash. Approximately $1.4 billion of our cash was held by our foreign subsidiaries with $0.6 billion held in countries where we intend to indefinitely reinvest any undistributed earnings.
As of January 28, 2023, we held $5.5 billion in cash. Approximately $1.2 billion of our cash was held by our foreign subsidiaries with $0.7 billion held in countries where we intend to indefinitely reinvest any undistributed earnings.
Equity In fiscal 2022, we lifted the temporary suspension of our repurchase program and we paid $2.2 billion to repurchase and retire 31.3 million shares of our stock on a settlement basis under our previously authorized stock repurchase programs.
Equity Under our stock repurchase program, we paid $2.3 billion to repurchase and retire 34.9 million shares of our stock on a settlement basis in fiscal 2023. We paid $2.2 billion to repurchase and retire 31.3 million shares of our stock on a settlement basis in fiscal 2022.
The cash outflows for both periods were primarily driven by capital expenditures and were lower in fiscal 2021 due to the COVID-19 pandemic. 34 Net cash used in investing activities include capital expenditures for the last two fiscal years as set forth in the table below: Fiscal Year Ended In millions January 29, 2022 January 30, 2021 New stores $ 79 $ 61 Store renovations and improvements 367 124 Office and distribution centers 599 383 Total capital expenditures $ 1,045 $ 568 We expect our capital expenditures in fiscal 2023 will be in the range of approximately $1.7 billion to $1.9 billion, including approximat ely $1.0 billion to $1.1 billion for our offices and distribution centers (including buying and merchandising systems and other information systems) to support growth, approximately $0.5 billion to $0.6 billion for store renovations and approximately $0.2 billion for new stores.
Net cash used in investing activities include capital expenditures for the last two fiscal years as set forth in the table below: Fiscal Year Ended In millions January 28, 2023 January 29, 2022 New stores $ 164 $ 79 Store renovations and improvements 594 367 Office and distribution centers 699 599 Total capital expenditures $ 1,457 $ 1,045 We expect our capital expenditures in fiscal 2024 will be in the range of approximately $1.7 billion to $1.9 billion, including approximat ely $0.9 billion to $1 billion for our offices and distribution centers (including buying and merchandising systems and other information systems) to support growth, approximately $0.6 billion to $0.7 billion for store renovations and approximatel y $0.2 billion for new stores.
Cost of sales, including buying and occupancy costs, was favorably impacted by approximately $27 million and $78 million of government programs for fiscal 2022 and fiscal 2021, respectively, in regions where we had temporary store closures. Fiscal 2022 vs Fiscal 2020 The expense ratio was flat for fiscal 2022 compared to the fiscal 2020.
Cost of sales, including buying and occupancy costs, was favorably impacted by approximately $9 million and $27 million of government programs for fiscal 2023 and fiscal 2022, respectively, in regions where we had temporary store closures.
Our operating cash flows decreased by $1.5 billion compared to fiscal 2021 due to the $4.7 billion change in merchandise inventories net of accounts payable, driven by rebuilding inventory levels in fiscal 2022 as well as the timing of merchandise payments in fiscal 2021.
Our operating cash flows increased by $1 billion compared to fiscal 2022 primarily due to the $1.5 billion change in merchandise inventories net of accounts payable. The change in inventory was primarily driven by the fiscal 2022 rebuilding of inventory levels.
This would represent a 13% increase over the per share dividends declared and paid in fiscal 2022. 35 Contractual Obligations See the descriptions of our financing arrangements, commitments and contingencies, and contractual obligations outlined below and within the following Notes to Consolidated Financial Statements. – See Note J—Long-Term Debt and Credit Lines of Notes to Consolidated Financial Statements for future payments under long-term debt arrangements (including current installments). – See Note L—Leases of Notes to Consolidated Financial Statements.
Contractual Obligations See the descriptions of our financing arrangements, commitments and contingencies, and contractual obligations outlined below and within the following Notes to Consolidated Financial Statements. – See Note J—Long-Term Debt and Credit Lines of Notes to Consolidated Financial Statements for future payments under long-term debt arrangements (including current installments). – See Note L—Leases of Notes to Consolidated Financial Statements.
We consider our most critical accounting estimates, involving uncertainty requiring management estimates and judgments, to be those relating to the areas described below. Inventory Valuation We use the retail method for valuing inventory for all our businesses except T.K. Maxx in Australia.
These judgments and estimates are based on historical experience and other factors which we continually review and believe are reasonable. We consider our most critical accounting estimates, involving uncertainty requiring management estimates and judgments, to be those relating to the areas described below. Inventory Valuation We use the retail method for valuing inventory for all our businesses except T.K.
While stores in the U.S. were open for all of fiscal 2022, a significant number of stores in TJX Canada and TJX International experienced COVID-19 related temporary store closures and government-mandated shopping restrictions during fiscal 2022. Therefore, we cannot measure year-over-year comparable store sales with fiscal 2022 in these geographies in a meaningful way.
For fiscal 2023, we returned to our historical definition of comparable store sales (as defined below). While stores in the U.S. were open for all of fiscal 2022, a significant number of stores in TJX Canada and TJX International experienced COVID-19 related temporary store closures and government-mandated shopping restrictions during fiscal 2022.
In fiscal 2023, we expect to open approximately 10 stores in Canada, which would increase selling square footage by approximately 1%. 32 TJX International Fiscal Year Ended U.S. dollars in millions January 29, 2022 January 30, 2021 February 1, 2020 Net sales $ 5,729 $ 3,842 $ 5,665 Segment profit (loss) $ 161 $ (504) $ 307 Segment margin 2.8 % (13.1) % 5.4 % Stores in operation at end of period: T.K.
In fiscal 2024, we expect to add approximately 11 stores in Canada, which would increase selling square footage by approximately 2%. 33 TJX International Fiscal Year Ended U.S. dollars in millions January 28, 2023 January 29, 2022 Net sales $ 6,215 $ 5,729 Segment profit $ 347 $ 161 Segment margin 5.6 % 2.8 % Stores in operation at end of period: T.K.
SEGMENTS Marmaxx Fiscal Year Ended U.S. dollars in millions January 29, 2022 January 30, 2021 February 1, 2020 Net sales $ 29,483 $ 19,363 $ 25,665 Segment profit $ 3,813 $ 891 $ 3,470 Segment margin 12.9 % 4.6 % 13.5 % Stores in operation at end of period: T.J.
SEGMENTS Marmaxx Fiscal Year Ended U.S. dollars in millions January 28, 2023 January 29, 2022 Net sales $ 30,545 $ 29,483 Segment profit $ 3,883 $ 3,813 Segment margin 12.7 % 12.9 % Comp store sales (a) 3 % 13 % Stores in operation at end of period: T.J.
Maxx Australia 1,198 1,109 990 Total 14,736 14,382 14,136 Net Sales Net sales for TJX International were $5.7 billion for fiscal 2022, an increase of 49% compared to $3.8 billion for fiscal 2021.
Maxx Australia 1 1 Total 15 15 Net Sales Net sales for TJX International were $6.2 billion for fiscal 2023, an increase of 8% compared to $5.7 billion for fiscal 2022.
Selling, General and Administrative Expenses SG&A expenses were $9.1 billion, or 18.7% of net sales, $7.0 billion, or 21.8% of net sales and $7.5 billion, or 17.9% of net sales for fiscal 2022, fiscal 2021 and fiscal 2020, respectively.
Selling, General and Administrative Expenses SG&A expenses, as a percentage of net sales, were 17.9% for fiscal 2023, a decrease of 0.8 percentage points over 18.7% for fiscal 2022.
Final resolutions of our tax positions or changes in accruals for uncertain tax positions could result in additional tax expense or benefit and could have a material impact on our results of operations of the period in which an examination or proceeding is resolved or in the period in which a changed outcome becomes probable and reasonably estimable. 36 Loss Contingencies Certain conditions may exist as of the date the consolidated financial statements are issued that may result in a loss to us but will not be resolved until one or more future events occur or fail to occur.
Final resolutions of our tax positions or changes in accruals for uncertain tax positions could result in additional tax expense or benefit and could have a material impact on our results of operations of the period in which an examination or proceeding is resolved or in the period in which a changed outcome becomes probable and reasonably estimable.
Beginning in fiscal 2020, Sierra stores that fit the comp store definition were included in comp stores in our Marmaxx segment. Comp sales of our foreign segments are calculated by translating the current year’s comp sales using the prior year’s exchange rates.
Comp store sales of our foreign segments are calculated by translating the current year’s comp store sales using the prior year’s exchange rates.
The decrease in segment profit margin was primarily driven by higher supply chain costs, lower merchandise margin, and incremental COVID-19 related store payroll costs and higher store wages, partially offset by the expense leverage on our occupancy and administrative costs due to the strong open-only comp store sales growth.
The decrease in segment profit margin for fiscal 2023 was driven by deleverage on lower comp store sales, primarily in occupancy and administrative costs, lower merchandise margin and higher store and distribution wages, partially offset by store payroll reflecting lower COVID-related expenses.
This measure reports the sales increase or decrease of these stores for the days the stores were open in the current period against sales for the same days in fiscal 2020, prior to the pandemic. Open-only comp store sales of our foreign segments are calculated by translating the current year using fiscal 2020’s exchange rates.
This measure reported the sales increase or decrease of these stores for the days the stores were open in fiscal 2022 against sales for the same days in fiscal 2020, prior to the emergence of the global pandemic. U.S. open-only comp store sales reports the open-only comp store sales for our Marmaxx and HomeGoods segments.
As a result, the comparable stores included in the fiscal 2023 measure will consist of U.S. stores only, which, we intend to refer to as U.S. comparable store sales and will be calculated against sales for the comparable periods in fiscal 2022. Our historical definition of comp store sales is also presented below for reference.
Therefore, we cannot measure year-over-year comparable store sales with fiscal 2022 in these geographies in a meaningful way. As a result, the comparable stores included in the fiscal 2023 measure consist of U.S. stores only, which we refer to as U.S. comparable store sales (“U.S. comp store sales”), and are calculated against sales for the comparable periods in fiscal 2022.
Net sales from our e-commerce sites combined amounted to less than 3% of total sales for each of fiscal 2022, fiscal 2021 and fiscal 2020.
The non-comp store sales increase reflects a fully open store base for fiscal 2023 compared to temporary store closures in fiscal 2022. Net sales from our e-commerce sites combined amounted to less than 3% of total sales for each of fiscal 2023 and fiscal 2022.
Dividends We declared quarterly dividends on our common stock of $0.26 per share for each of the quarters in fiscal 2022 which totaled $1.04 per share in fiscal 2022. As a result of the uncertainty surrounding the COVID-19 pandemic, no dividends were declared in the first nine months of fiscal 2021.
We declared quarterly dividends on our common stock of $0.26 per share for each of the quarters in fiscal 2022, which totaled $1.04 per share in fiscal 2022. Cash payments for dividends on our common stock totaled $1.3 billion for both fiscal 2023 and fiscal 2022.
Cash payments for dividends on our common stock totaled $1.3 billion for fiscal 2022 and $0.3 billion for fiscal 2021. We expect to pay quarterly dividends for fiscal 2023 of $0.295 per share, or an annual dividend of $1.18 per share, subject to the declaration and approval by our Board of Directors.
We expect to pay quarterly dividends for fiscal 2024 of $0.3325 per share, or an annual dividend of $1.33 per share, subject to the declaration and approval by our Board of Directors. This would represent a 13% increase over the per share dividends declared and paid in fiscal 2023.
In fiscal 2021, we completed the issuance and sale of certain of our Notes and used the proceeds to partially fund the purchase of certain Notes, resulting in a pre-tax early extinguishment debt charge of $312 million. 28 Interest Expense, net The components of interest expense, net for the last two fiscal years are summarized below: Fiscal Year Ended In millions January 29, 2022 January 30, 2021 Interest expense $ 123 $ 199 Capitalized interest (4) (5) Interest (income) (4) (13) Interest expense, net $ 115 $ 181 Net interest expense decreased for fiscal 2022 compared to fiscal 2021, primarily due to the prior year’s refinancing of certain notes in December 2020 as well as the $2.75 billion pay down of outstanding debt during fiscal 2022.
Interest Expense, net The components of interest expense, net for the last two fiscal years are summarized below: Fiscal Year Ended In millions January 28, 2023 January 29, 2022 Interest expense $ 91 $ 123 Capitalized interest (7) (4) Interest (income) (78) (4) Interest expense, net $ 6 $ 115 Net interest expense decreased for fiscal 2023 compared to fiscal 2022, primarily due to an increase in interest income, due to an increase in prevailing rates, as well as the $2.75 billion pay down of outstanding debt during fiscal 2022.
In fiscal 2023, we expect to open approximately 55 Marmaxx stores and 20 Sierra stores, which would increase selling square footage by approximately 2%. 30 HomeGoods Fiscal Year Ended U.S. dollars in millions January 29, 2022 January 30, 2021 February 1, 2020 Net sales $ 8,995 $ 6,096 $ 6,356 Segment profit $ 907 $ 510 $ 681 Segment margin 10.1 % 8.4 % 10.7 % Stores in operation at end of period: HomeGoods 850 821 809 Homesense 39 34 32 Total 889 855 841 Selling square footage at end of period (in thousands): HomeGoods 15,550 15,034 14,831 Homesense 837 733 685 Total 16,387 15,767 15,516 Net Sales Net sales for HomeGoods were $9.0 billion for fiscal 2022, an increase of 48%, compared to $6.1 billion for fiscal 2021.
In fiscal 2024, we expect to add approximately 45 Marmaxx net new stores and 18 new Sierra stores, which would increase selling square footage by approximately 2%. 31 HomeGoods Fiscal Year Ended U.S. dollars in millions January 28, 2023 January 29, 2022 Net sales $ 8,264 $ 8,995 Segment profit $ 522 $ 907 Segment margin 6.3 % 10.1 % Comp store sales (a) (11) % 32 % Stores in operation at end of period: HomeGoods 894 850 Homesense 46 39 Total 940 889 Selling square footage at end of period (in millions): HomeGoods 16 15 Homesense 1 1 Total 17 16 (a) Comp store sales reported for fiscal 2023 and open-only comp store sales reported for fiscal 2022.
Fiscal 2022 vs Fiscal 2020 Segment profit decreased $31 million compared to a segment profit of $516 million for fiscal 2020. Segment profit margin decreased to 11.2% for fiscal 2022 compared to 12.8% for fiscal 2020.
Segment Profit Margin Segment profit margin increased to 14.0% for fiscal 2023 compared to a segment profit margin of 11.2% for fiscal 2022.
Maxx 618 602 594 Homesense 77 78 78 T.K. Maxx Australia 68 62 54 Total 763 742 726 Selling square footage at end of period (in thousands): T.K. Maxx 12,412 12,131 11,997 Homesense 1,126 1,142 1,149 T.K.
Maxx 629 618 Homesense 78 77 T.K. Maxx Australia 74 68 Total 781 763 Selling square footage at end of period (in millions): T.K. Maxx 13 13 Homesense 1 1 T.K.
In fiscal 2023, we expect to open approximately 15 stores in Europe and approximately 10 stores in Australia, which would increase selling square footage by approximately 3%. 33 GENERAL CORPORATE EXPENSE Fiscal Year Ended In millions January 29, 2022 January 30, 2021 General corporate expense $ 611 $ 439 General corporate expense for segment reporting purposes represents those costs not specifically related to the operations of our business segments.
GENERAL CORPORATE EXPENSE Fiscal Year Ended In millions January 28, 2023 January 29, 2022 General corporate expense $ 582 $ 611 General corporate expense for segment reporting purposes represents those costs not specifically related to the operations of our business segments. General corporate expenses are primarily included in SG&A expenses.
In fiscal 2023, we expect to open approximately 60 HomeGoods stores, including 10 Homesense stores, which would increase selling square footage by approximately 7%. 31 FOREIGN SEGMENTS TJX Canada Fiscal Year Ended U.S. dollars in millions January 29, 2022 January 30, 2021 February 1, 2020 Net sales $ 4,343 $ 2,836 $ 4,031 Segment profit $ 485 $ 124 $ 516 Segment margin 11.2 % 4.4 % 12.8 % Stores in operation at end of period: Winners 293 280 279 HomeSense 147 143 137 Marshalls 106 102 97 Total 546 525 513 Selling square footage at end of period (in thousands): Winners 6,300 6,015 5,986 HomeSense 2,708 2,644 2,511 Marshalls 2,220 2,141 2,043 Total 11,228 10,800 10,540 Net Sales Net sales for TJX Canada were $4.3 billion for fiscal 2022, an increase of 53% compared to $2.8 billion for fiscal 2021.
This would increase selling square footage by approximately 6%. 32 FOREIGN SEGMENTS TJX Canada Fiscal Year Ended U.S. dollars in millions January 28, 2023 January 29, 2022 Net sales $ 4,912 $ 4,343 Segment profit $ 690 $ 485 Segment margin 14.0 % 11.2 % Stores in operation at end of period: Winners 297 293 HomeSense 151 147 Marshalls 106 106 Total 554 546 Selling square footage at end of period (in millions): Winners 6 6 HomeSense 3 3 Marshalls 2 2 Total 11 11 Net Sales Net sales for TJX Canada were $4.9 billion for fiscal 2023, an increase of 13% compared to $4.3 billion for fiscal 2022.
These two items can impact segment margin comparison of our foreign divisions and we have highlighted them when they are meaningful to understanding operating trends. 27 Cost of Sales, Including Buying and Occupancy Costs Cost of sales, including buying and occupancy costs, was $34.7 billion, or 71.5% of net sales, $24.5 billion, or 76.3% of net sales, $29.8 billion, or 71.5% of net sales for fiscal 2022, fiscal 2021 and fiscal 2020, respectively.
These two items can impact segment margin comparison of our foreign divisions and we have highlighted them when they are meaningful to understanding operating trends.
SG&A expense was favorably impacted by $214 million and $434 million from government programs for fiscal 2022 and fiscal 2021 , respectively, in regions where we had temporary store closures. Fiscal 2022 vs Fiscal 2020 The expense ratio increased 0.8% for fiscal 2022 compared to fiscal 2020.
The decrease in SG&A ratio for fiscal 2023 was primarily driven by store payroll due to a reduction of COVID-related costs and lower share-based and incentive compensation costs, partially offset by higher store wages. SG&A expense was favorably impacted by $214 million from government programs for fiscal 2022 in regions where we had temporary store closures.
General corporate expenses are primarily included in SG&A expenses. The mark-to-market adjustment of our fuel hedges is included in cost of sales, including buying and occupancy costs. The increase in general corporate expense for fiscal 2022 was primarily driven by higher share-based and incentive compensation costs.
The mark-to-market adjustment of our fuel and inventory hedges is included in cost of sales, including buying and occupancy costs.
For fiscal 2022, we temporarily reported open-only comp store sales, as described below. For fiscal 2023, we intend to return to our historical definition of comparable store sales.
We expect all geographies to return to the historical definition of comparable store sales in fiscal 2024. U.S. comp store sales were flat for fiscal 2023 compared to a 17% U.S. open-only comp store sales (as defined below) increase for fiscal 2022.
Our management, with the assistance of our legal counsel, assesses such contingent liabilities. Such assessments inherently involve the exercise of judgment.
Such assessments inherently involve the exercise of judgment.
Since the second quarter of fiscal 2021, we temporarily reported open-only comp store sales. Open-only comp store sales includes stores initially classified as comp stores at the beginning of fiscal 2021 that had to temporarily close due to the COVID-19 pandemic.
In order to provide a performance indicator for its stores, during fiscal 2022, we temporarily reported open-only comp store sales. Open-only comp store sales included stores initially classified as comp stores at the beginning of fiscal 2021.
In addition to our four main segments, Sierra operates sierra.com and retail stores in the U.S. The results of Sierra are included in the Marmaxx segment. RESULTS OF OPERATIONS Matters Affecting Comparability The COVID-19 pandemic continued to impact the U.S. and other countries around the world in fiscal 2022.
In addition to our four main segments, Sierra operates retail stores and sierra.com in the U.S. The results of Sierra are included in the Marmaxx segment. RESULTS OF OPERATIONS Highlights of our financial performance for fiscal 2023 include the following: – Net sales increased 3% to $49.9 billion for fiscal 2023 versus $48.5 billion for fiscal 2022.
Segment profit margin decreased to 12.9% for fiscal 2022 compared to 13.5% for fiscal 2020. The decrease was primarily driven by incremental COVID-19 related store payroll costs and higher supply chain costs, partially offset by leverage on occupancy costs due to the strong open-only comp store sales growth and improved merchandise margin.
Segment Profit Margin Segment profit margin decreased to 12.7% for fiscal 2023 compared to a segment profit margin of 12.9% for fiscal 2022. The decrease in segment profit margin was driven by lower merchandise margin and higher store wages, partially offset by store payroll reflecting lower COVID-related expenses.
Diluted earnings per share in fiscal 2022 were $2.70, which included a second quarter debt extinguishment charge of $0.15, $0.07 in fiscal 2021, which included a debt extinguishment charge of $0.19, and $2.67 in fiscal 2020. Segment Information We operate four main business segments. Our Marmaxx segment (T.J.
Foreign currency had a $0.06 negative impact on earnings per share in fiscal 2023 compared to a neutral impact on earnings per share in fiscal 2022. A $242 million debt extinguishment charge in fiscal 2022 had a $0.15 negative impact on earnings per share for fiscal 2022. Segment Information We operate four main business segments. Our Marmaxx segment (T.J.
Fiscal 2022 vs Fiscal 2020 Segment profit increased by $0.2 billion compared to a segment profit of $0.7 billion for fiscal 2020, primarily due to the increase in sales. Segment profit margin decreased to 10.1% for fiscal 2022 compared to 10.7% for fiscal 2020.
Segment Profit Margin Segment profit margin decreased to 6.3% for fiscal 2023 compared to a segment profit margin of 10.1% for fiscal 2022.
ANALYSIS OF FINANCIAL CONDITION Liquidity and Capital Resources Our liquidity requirements have traditionally been funded through cash generated from operations, supplemented, as needed, by short-term bank borrowings and the issuance of commercial paper. As of January 29, 2022, there were no short-term bank borrowings or commercial paper outstanding.
The decrease in general corporate expense for fiscal 2023 was primarily driven by lower share-based and incentive compensation costs, timing of funding to TJX’s charitable foundations partially offset by the mark-to-market adjustment on fuel and inventory derivatives. 34 ANALYSIS OF FINANCIAL CONDITION Liquidity and Capital Resources Our liquidity requirements have traditionally been funded through cash generated from operations, supplemented, as needed, by short-term bank borrowings and the issuance of commercial paper.
The increase in open-only comp store sales was driven by an increase in average basket, partially offset by reduced customer traffic. Segment Profit Fiscal 2022 vs Fiscal 2021 Segment profit was $0.5 billion for fiscal 2022, an increase of $0.4 billion, compared to a segment profit of $0.1 billion for fiscal 2021.
Net Sales Net sales for HomeGoods were $8.3 billion for fiscal 2023, a decrease of 8%, compared to $9.0 billion for fiscal 2022. The decrease in net sales reflects an 11% decrease from comp store sales, partially offset by a 3% increase from non-comp store sales.
The decrease in segment profit margin was primarily driven by higher supply chain costs and higher store payroll, including incremental COVID-19 related costs, net of government programs. This was partially offset by improved merchandise margin. Within merchandise margin, strong markon and lower markdowns collectively more than offset incremental freight costs.
This increase was primarily driven by leverage on increased sales, primarily in occupancy and administrative costs as well as higher merchandise margin, lower COVID-related expenses in stores and distribution centers and lower incentive compensation costs. Within merchandise margin, strong markon was partially offset by incremental freight costs and higher markdowns.
The increase in net sales reflected temporary store closures, which were closed for approximately 19% of fiscal 2022 and 36% of fiscal 2021, as a result of the COVID-19 pandemic. In addition to stores being open for more days in fiscal 2022, net sales further increased due to higher customer traffic and increased average basket.
The increase in net sales reflected having a fully open store base for fiscal 2023, compared to temporary store closures in fiscal 2022, as a result of the COVID-19 pandemic. Within net sales, an increase in average basket driven by higher average ticket was partially offset by the negative foreign currency exchange rate impact of 5% for fiscal 2023.
Maxx 1,284 1,271 1,273 Marshalls 1,148 1,131 1,130 Sierra 59 48 46 Total 2,491 2,450 2,449 Selling square footage at end of period (in thousands): T.J.
Maxx 1,299 1,284 Marshalls 1,183 1,148 Sierra 78 59 Total 2,560 2,491 Selling square footage at end of period (in millions): T.J. Maxx 28 28 Marshalls 27 26 Sierra 1 1 Total 56 55 (a) Comp store sales reported for fiscal 2023 and open-only comp store sales reported for fiscal 2022.
As a result of these redemptions prior to their scheduled maturities, we recorded a pre-tax debt extinguishment charge of $242 million in the second quarter of fiscal 2022. For additional information on the debt transactions, see Note J—Long-Term Debt and Credit Lines of Notes to Consolidated Financial Statements.
Our 2.50% ten-year Notes due May 2023 will mature during the second quarter of fiscal 2024 and are included within our current maturities of long-term debt. See Note J—Long-Term Debt and Credit Lines of Notes to Consolidated Financial Statements for additional information.
Net sales increased 42% compared to $6.4 billion for fiscal 2020. Open-only comp store sales were up 32% for fiscal 2022 compared to fiscal 2020. The increase in open-only comp store sales was driven by an increase in average basket and customer traffic.
Net Sales Net sales for Marmaxx were $30.5 billion for fiscal 2023, an increase of 4% compared to $29.5 billion for fiscal 2022. The increase in net sales reflects a 3% increase from comp store sales and a 1% increase from non-comp store sales.
The increase for fiscal 2022 was primarily driven by increased sales due to having fewer temporary store closures in fiscal 2022 compared to fiscal 2021. Within merchandise margin, lower markdowns and higher markon were partially offset by increased freight costs. Fiscal 2022 also reflected $84 million of government programs compared to $148 million for fiscal 2021.
The increase for fiscal 2023 was primarily driven by leverage on increased sales, primarily in occupancy and administrative costs, and higher merchandise margin as well as lower store payroll reflecting lower COVID-related expenses, and lower incentive compensation costs. Merchandise margin reflects strong markon partially offset by incremental freight costs for fiscal 2023.
Provision (Benefit) for Income Taxes The effective income tax rate was 25.4%, (1.4)%, and 25.7% for fiscal 2022, fiscal 2021, and fiscal 2020, respectively. The increase in the fiscal 2022 effective income tax rate was primarily due to the significant increase in profit in fiscal 2022 as compared to the mix of income and losses by jurisdictions in fiscal 2021.
The effective income tax rate was 24.5% for fiscal 2023 compared to 25.4% for fiscal 2022.
Removed
During fiscal 2022, while our stores in the U.S. and all of our e-commerce businesses remained open for the entire period, we did have government-mandated temporary store closures in Europe, Canada and Australia, resulting in our stores being closed in the aggregate for approximately 4% of fiscal 2022.
Added
As of January 28, 2023, both the number of stores in operation and selling square footage increased approximately 3% compared to the end of fiscal 2022. – U.S. comp store sales were flat in fiscal 2023. U.S. open-only comp store sales increased 17% for fiscal 2022.
Removed
Additionally, intermittently throughout the year, we operated under government-mandated shopping restrictions, including capacity limitations. Stores were temporarily closed for approximately 24% of fiscal 2021 due to temporary closures across all geographies. Overall, our fiscal 2022 results were significantly better than our fiscal 2021 results.
Added
See Net Sales below for definitions of both U.S. comp store sales and U.S. open-only comp store sales. – Net sales increased 13% for TJX Canada and increased 8% for TJX International in fiscal 2023.
Removed
In addition to comparing current year results to fiscal 2021, we may, where meaningful, also compare these results to a comparable period in the fiscal year ended February 1, 2020, prior to the emergence of the pandemic. We believe this additional comparison provides insight into how we are managing the business and performing as compared to our pre-pandemic results.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeThe analysis indicated a potential impact of approximately $65 million on our pre-tax income in fiscal 2022 and approximately $38 million in fiscal 2021. EQUITY PRICE AND OTHER MARKET RISK The assets of our funded qualified pension plan, a portion of which are equity securities, are subject to the risks and uncertainties of the financial markets.
Biggest changeThe analysis indicated a potential impact of approximately $104 million on our pre-tax income in fiscal 2023 and approximately $65 million in fiscal 2022. EQUITY PRICE AND OTHER MARKET RISK The assets of our funded qualified pension plan, a portion of which are equity securities, are subject to the risks and uncertainties of the financial markets.
Financial Statements and Supplementary Data The information required by this item may be found on pages F-1 through F-34 of this annual report on Form 10-K. ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure Not applicable. 37
Financial Statements and Supplementary Data The information required by this item may be found on pages F-1 through F-34 of this annual report on Form 10-K. ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure Not applicable.

Other TJX 10-K year-over-year comparisons