TJX, An American multinational corporation, announces the shutdown of all of its stores for two weeks. The company has over 4500 stores in different countries, including Canada, the United States, Australia, and Europe.
All of the above stores are running under the following brands-
- T.J. Maxx,
- Sierra Trading Post,
- Home Goods, and
The company is taking such a step for –
- The well being of people and
- To protect its finances and endure the damage that COVID-19 is doing.
What Earnie Herrman Said About The TJX Shutdown?
Right after the shutdown announcement, TJS shares fall about 15 percent in intraday trading. Later, it did recover and closed at $41.46, a bit higher than the previous day’s price.
Ernie Herman, president, and CEO of TJX Companies Inc said that the company is willing to pay the dividends once the virus situation stabilizes for the long-term.
TJX paid dividends of 23 cents a share of the first quarter in early March, and the annual dividend is around 92 cents.
Also, the shutdown includes online businesses as well –
- marshalls.com, and
… along with their offices, fulfilment and distribution centres.
TJX joins an unwanted list of retailers that either shutdown their showrooms and stores or alter their working hours because of the coronavirus outbreak. According to Ernie, they are also trying to maintain flexibility and financial liquidity by reducing its capital expenses.
Also, the process includes –
- Reducing capital expenditures,
- Reviewing all operating expenses and
- Suspending the share repurchase program
How Coronavirus Affects TJX Company’s Plans?
For the first quarter, the company’s earnings expectations were 59-60 cents per share. This earning is 57 cents more than the previous year’s quarter and overall growth of 2-3% for the quarter.
The company was also expecting Marmaxx’s growth in the same range. However, TJX withdrew these predictions and hasn’t provided any updates yet.