~~Proceeds from the sale of gift cards as well as the value of store cards issued to customers as a result of a return or exchange are~~The following table presents deferred ~~until the customers use the cards to acquire merchandise, as TJX does not fulfill its performance obligation until the~~ gift card has been redeemed. While gift cards have an indefinite life, substantially all are redeemed in the first year of issuance. Based on historical experience, we estimate the amount of gift cards and store cards that will not be redeemed and, to the extent allowed by local law, these amounts are amortized into income over the redemption period.revenue activity:



In thousands	August 3, 2019			August 4, 2018
Balance, beginning of year	$	450,302		$	406,506
Deferred revenue	747,827			731,890
Effect of exchange rates changes on deferred revenue	(826		)	(4,871		)
Revenue recognized	(791,293		)	(774,955		)
Balance, end of period	$	406,010		$	358,570

In thousands November 3,
2018
Balance, February 3, 2018 $ 406,506
Deferred revenue 1,096,333
Effect of exchange rates changes on deferred revenue (6,561 )
Revenue recognized (1,138,507 )
Balance, November 3, 2018 $ 357,771

TJX recognized ~~$1.1 billion~~$407.6 million in gift card revenue for the ~~nine~~three months ended ~~November~~August 3, 2019 and $403.1 million for the three months ended August 4, 2018. Gift cards are combined in one homogeneous pool and are not separately identifiable. As such, the revenue recognized consists of gift cards that were part of the deferred revenue balance at the beginning of the period as well as gift cards that were issued during the period.

~~Sales Return Reserve~~

~~Our products are generally sold with a right~~

Summary of ~~return and we may provide other credits or incentives, which are accounted for~~Accounting Policies

Leases

We adopted ASU No. 2016-02, Leases (Topic 842), as ~~variable consideration when estimating the amount~~ of ~~revenue to recognize. We have elected to apply the portfolio practical expedient and are estimating the variable consideration~~February 3, 2019, using the ~~expected value~~modified retrospective method when calculating the returns reserve, as the difference to applying it to the individual contract would not differ materially. Returns are estimated based on historical experience and are required to be established and presented at the gross sales value with an asset established for the estimated value of the merchandise returned separate from the refund liability. Liabilities for return allowances are included in “Accrued expenses and other current liabilities” and the offsetting receivable is included in “Prepaid expenses and other current assets” on our consolidated balance sheets.

~~Goodwill~~

Goodwill includes the excess of the purchase price paid over the carrying value of the minority interest acquired in fiscal 1990 in TJX’s former 83%-owned subsidiary and represents goodwill associated with the T.J. Maxx chain, as well as the excess of cost over the estimated fair market value of the net assets acquired by TJX in the purchase of Winners in fiscal 1991, the purchase of Sierra Trading Post (“STP”) in fiscal 2013, and the purchase of Trade Secret in fiscal 2016, which was re-branded under ~~the T.K. Maxx name during fiscal 2018.~~ASU 2018-11. The ~~following is a roll forward of goodwill by component:~~

In thousands Marmaxx Winners
Sierra Trading
Post

T.K. Maxx in
Australia
Total
Balance, January 28, 2017 $ 70,027
$ 1,686
$ 97,254
$ 26,904
$ 195,871
Impairment —
—
(97,254 ) —
(97,254 )
Effect of exchange rate changes on goodwill —
98
—
1,354
1,452
Balance, February 3, 2018 70,027
1,784
—
28,258
100,069
Effect of exchange rate changes on goodwill —
(93 ) —
(2,628 ) (2,721 )
Balance, November 3, 2018 $ 70,027
$ 1,691
$ —
$ 25,630
$ 97,348

Goodwill is considered to have an indefinite life and accordingly is not amortized. In the fourth quarter of fiscal 2018, the Company recorded an impairment charge of $99.3 million, which included $97.3 million of STP goodwill and $2.0 million for certain long-lived assets of STP, as the estimated fair value of the STP business fell below its carrying value due to a decrease in projected revenue growth rates. The impairment charge is included within the Marmaxx segment results. Goodwill, and the related impairments, if any, are included in the respective operating segment to which they relate.

~~Future Adoption of New Accounting Standards~~

~~Leases~~

In February 2016, the Financial Accounting Standards Board (“FASB”) issued updated guidance on leases to increase transparency and comparability among organizations by requiring lessees to recognize right of use assets and lease liabilities on the balance sheet and requiring disclosure of key information about leasing arrangements. The new standard is effective for annual periods beginning after December 15, 2018, and interim periods within those annual periods; early adoption is permitted. In July 2018, the FASB issued ASU 2018-11, ~~Leases (Topic 842): Targeted Improvements, which~~transition method allows entities to apply the transition requirements at the effective date rather than at the beginning of the earliest comparative period ~~presented as previously required. The effect of initially applying the standard can be recognized as a cumulative-effect adjustment to retained earnings in the period of adoption and an entity’s~~presented. Our reporting for ~~the~~ comparative periods is presented ~~in the year of adoption would continue to be~~ in accordance with ASC 840, ~~Leases (Topic 840)~~ (“ASC 840”), including the disclosure requirements of ASC 840. If the new transition method in ASU 2018-11 is not elected, the new standard must be adopted using a modified retrospective transition and requires application of the new guidance for leases that exist or are entered into after the beginning of the earliest comparative period presented. The Company plans to adopt this standard in the first quarter of the fiscal year ending February 1, 2020 ("fiscal 2020") using the optional transition method under ASU 2018-11.

The Company is in the process of implementing a new lease accounting system and has established a cross-functional team to implement the updated lease guidance. This team is in the process of evaluating our lease portfolio to assess the impact this standard will have on our Consolidated Financial Statements and Notes thereto. The Company has determined that the initial lease term will not differ under the new standard versus current accounting practice, and therefore the income statement impactLeases. Adoption of the new standard is not expected to be material. Any impact to the income statement would be the result of the timing of expense recognition and would not be incremental over the term of the lease. For example, under ASC 842 certain initial direct costs will no longer be capitalized and amortized over the lease term and will be expensed as incurred. In addition, in certain instances, the cost of our renewal options may be recognized earlierresulted in the ~~life~~recording of ~~the~~right of use (“ROU”) assets and lease ~~than under the existing lease accounting rules.~~liabilities of approximately $9 billion, as of February 3, 2019. The Company expects this standard will have a material impact on its Consolidated Balance Sheet as it will record a significant asset and liability associated with its nearly 4,300 leased locations. The Company plans to implementelected the transition package of three practical expedients, ~~permitted within the standard,~~ which among other things, ~~allows for~~allowed us to carry forward the ~~carryforward of~~ historical lease ~~classifications.~~classification. We have elected, under Topic 842, the practical expedient to not separate non-lease components from the lease components to which they relate and instead to combine them and account for them as a single lease component. The Company ~~expects to make an~~also elected the accounting policy election ~~that will~~to keep leases with a term of 12twelve months or less off the ~~balance sheet~~Consolidated Balance Sheets and ~~result in recognizing those~~recognizes these lease payments on a straight-line basis over the lease term. As

Operating leases are included in "Operating lease right of use assets", "Current portion of operating lease liabilities", and "Long-term operating lease liabilities" on our Consolidated Balance Sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. At the inception of the arrangement, the Company determines if an arrangement is a lease based on assessment of the terms and conditions of the contract. Operating lease ROU assets and lease liabilities are recognized at possession date based on the present value of lease payments over the lease term. The majority of our leases are retail store locations and the possession date is typically 30 to 60 days prior to the opening of the store and generally occurs before the commencement of the lease term, as specified in the lease. Our lessors do not provide an implicit rate, nor is itone readily available, therefore we ~~plan to~~ use our incremental borrowing rate based on the information available at ~~commencement~~possession date ~~to determine~~in determining the present value of future lease payments. The incremental borrowing rate is calculated based on the US Consumer Discretionary yield curve and adjusted for collateralization and foreign currency impact for TJX International and Canada leases. The operating lease ROU asset also includes any acquisition costs offset by lease incentives. Our lease terms include options to extend the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term within "Cost of sales, including buying and occupancy costs".

Impact of New Lease Standard on Consolidated Balance Sheet Line Items

As a result of applying the new lease standard using the optional transition method, the following adjustments were made to accounts on the Condensed Consolidated Balance Sheet as of February 3, 2019:



In thousands	As Reported February 2, 2019		Adjustments				Adjusted February 3, 2019
CONDENSED CONSOLIDATED BALANCE SHEETS:
Prepaid expenses and other current assets	$	513,662	$	(149,029	)	^(a)	$	364,633
Net property at cost	5,255,208		(281,361		)	^(b),(f)	4,973,847
Operating lease right of use asset	—		8,704,584			^(c)	8,704,584
Other assets	497,580		(30,086		)	^(b)	467,494
Total Assets	$	14,326,029	$	8,244,108			$	22,570,137

Accrued expenses and other current liabilities	2,733,076		(3,819		)		2,729,257
Current portion of operating lease liabilities	—		1,481,555			^(d)	1,481,555
Other long-term liabilities	1,354,242		(593,137		)	^(e),(f)	761,105
Long-term operating lease liabilities	—		7,359,106			^(d)	7,359,106
Retained earnings	4,461,744		403			^(f),(g)	4,462,147
Total Liabilities and Shareholders' Equity	$	14,326,029	$	8,244,108			$	22,570,137


(a)	Represents prepaid rent reclassified to operating lease right of use assets and current portion of operating lease liabilities.


(b)	Represents impact of reclassifying initial direct costs to operating lease right of use assets.


(c)	Represents capitalization of operating lease right of use assets and reclassification of lease acquisition costs, straight-line rent, prepaid rent and tenant incentives.


(d)	Represents recognition of current and long-term operating lease liabilities.


(e)	Represents reclassification of straight-line rent to operating lease right of use assets.


(f)	Represents de-recognition of assets and liabilities related to non-TJX owned properties under previously existing build-to-suit accounting rules.


(g)	Represents impairment at transition on operating lease right of use assets.

See Note L—Leases of Notes to Consolidated Financial Statements for additional information.

~~Hedging Activities~~Future Adoption of New Accounting Standards

Intangibles-Goodwill and Other-Internal-Use Software

In August ~~2017,~~2018, the ~~FASB~~Financial Accounting Standards Board "FASB" issued ~~updated~~ guidance ~~on hedge accounting. The updates allow hedge~~related to accounting for ~~new types of interest rate hedges of financial instruments~~implementation costs incurred in a cloud computing arrangement that is a service contract. The standard allows entities who are customers in hosting arrangements that are service contracts to apply the existing internal-use software guidance to determine which implementation costs to capitalize as an asset related to the service contract and ~~simplify~~which costs to expense. The guidance specifies classification for capitalizing implementation costs and related amortization expense within the ~~documentation requirements~~Consolidated Financial Statements and requires additional disclosures. The Company plans to ~~qualify for hedge accounting. In addition, any gain or loss from hedge ineffectiveness will be reported~~early adopt the standard prospectively in the ~~same income statement line with the effective hedge results~~third quarter of fiscal 2020 and ~~the hedged transaction. The updated guidance is effective for annual reporting periods beginning after December 15, 2018, and early adoption is permitted. The Company~~ does not anticipate ~~this pronouncement will have~~ a material impact of the adoption on its ~~consolidated financial statements.~~Consolidated Financial Statements.

Recently Adopted Accounting Standards

Leases

See Leases in this Note A for the impact upon adoption.

Income Statement – Reporting Comprehensive Income

In February 2018, the FASB issued updated guidance related to reporting comprehensive income. The ~~updated guidance allows~~amendments in the update allow for a one-time reclassification from accumulated other comprehensive income (“AOCI”) to retained earnings for stranded tax effect ~~resulting~~as a result from the enactment of the Tax Cuts and Jobs Act of 2017 ~~(the “2017~~(“2017 Tax Act”). The updated guidance is effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted, including adoption in any interim period for reporting periods for which financial statements have not yet been issued. The updated guidance should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the 2017 Tax Act is recognized. The Company ~~has~~adopted the standard and made the policy election not ~~yet determined~~to reclassify the ~~timing of adoption or estimated the effect on its consolidated financial statements.~~

~~Non-Employee Share-Based Payments~~

In June 2018, the FASB issued updated guidance related to compensation - stock compensation: Improvements to Non-Employee Share-Based Payment Accounting. The updated guidance aligns the measurement and classification guidance for share-based payments to non-employees with the guidance for share-based payments to employees, with certain exceptions. The amendments in this ASU will be effective for the Company for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted. The Company does not anticipate this pronouncement will have an impact on its consolidated financial statements.

~~Intangibles-Goodwill and Other-Internal-Use Software~~

In August 2018, the FASB issued guidance related to accounting for implementation costs incurred in a cloud computing arrangement that is a service contract. The standard allows entities who are customers in hosting arrangements that are service contracts to apply the existing internal-use software guidance to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. The guidance specifies classification for capitalizing implementation costs and related amortization expense within the financial statements and requires additional disclosures. The guidance will be effective for annual reporting periods, including interim reporting within those periods, beginning after December 15, 2019. Early adoption is permitted and can be applied either retrospectively or prospectively. The Company is currently evaluating the transition methods and the impact of the adoption of this standard on its consolidated financial statements.

~~Fair Value Measurement Disclosure Framework~~

In August 2018, the FASB issued guidance related to changes to the disclosure requirements for fair value measurements. This ASU modifies the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. The primary focus of the guidance is to improve the effectiveness of the disclosure requirements for fair value measurements. In general, the amendments are effective for all entities for fiscal years and interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted for the removed disclosures and delayed adoption until fiscal year 2021 permitted for the new disclosures. The removed and modified disclosures will be adopted on a retrospective basis and the new disclosures will be adopted on a prospective basis. The Company is currently evaluating the potential effects of the pronouncement on its disclosure requirements.

~~Compensation Retirement Defined Benefit Plans Disclosure Framework~~

In August 2018, the FASB issued guidance related to changes to the disclosure requirements for defined benefit plans. This ASU removes certain disclosures that are not considered cost beneficial, clarifies certain required disclosures and requires certain additional disclosures. The standard is effective on a retrospective basis for fiscal years ending after December 15, 2020, with early adoption permitted. The Company is currently evaluating the impact of the pronouncement on its disclosure requirements.

~~Recently Adopted Accounting Standards~~

~~Revenue Recognition~~

~~See Revenue Recognition in this Note A for the impact upon adoption.~~

~~Cash Flows~~

In the first quarter of fiscal 2019, TJX adopted a pronouncement that addresses differences in the way certain cash receipts and cash payments are presented in the statement of cash flows. The new guidance provides clarity around the cash flow classification for eight specific issues in an effort to reduce the current and potential future differences in practice. The standard did not have a material impact on our consolidated statements of cash flows.

~~Retirement Benefits~~

~~In the first quarter of~~ ~~fiscal 2019~~, TJX adopted a pronouncement related to retirement benefits, which requires that an employer report the service cost component of net periodic pension and net periodic post retirement cost in the same line item as other compensation costs arising from services rendered by the employees during the period. It also requires the other components of net periodic pension and net periodic postretirement benefit cost to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if such a subtotal is presented. The amendments in this update were applied retrospectively for the presentation of the service cost component and the other components of net periodic pension cost and net periodic postretirement benefit cost in the income statement. The impact to prior periods was immaterial. As a result of the adoption, for the ~~three and nine~~ ~~months ended November 3, 2018, service costs are recorded in the same line items as other compensation costs and non-service costs are recorded in SG&A in our income statement.~~

~~Income Taxes~~

~~In the first quarter of fiscal 2019, TJX adopted~~ ~~Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118~~ ~~(referred to as~~ "~~ASU 2018-05"), which provides guidance on accounting for the~~stranded tax effects ~~of the 2017 Tax Act. This guidance allows a company~~from AOCI to record a provisional amount when it does not have the necessary information available, prepared, or analyzed in reasonable detail to complete its accounting for the change in the tax law during the measurement period. The measurement period ends when the company has obtained, prepared, and analyzed the information necessary to finalize its accounting, but cannot extend beyond one year. We will continue to assess our provision for income taxes as future guidance is issued.retained earnings.

Note B. Property at Cost

The following table presents the components of property at cost:



In thousands	August 3, 2019		February 2, 2019		August 4, 2018
Land and buildings^(a)	$	1,235,675	$	1,457,835	$	1,395,034
Leasehold costs and improvements^(a)	3,410,862		3,377,045		3,263,267
Furniture, fixtures and equipment	6,096,876		5,894,239		5,619,196
Total property at cost	$	10,743,413	$	10,729,119	$	10,277,497
Less accumulated depreciation and amortization^(a)	5,701,535		5,473,911		5,177,043
Net property at cost	$	5,041,878	$	5,255,208	$	5,100,454


(a)	See Leases in Note A—Basis of Presentation and Summary of Significant Accounting Policies of Notes to Consolidated Financial Statements for impact of lease accounting changes.

In thousands November 3,
2018 February 3,
2018 October 28,
2017
Land and buildings $ 1,423,528
$ 1,355,777
$ 1,294,992
Leasehold costs and improvements 3,318,857
3,254,830
3,145,922
Furniture, fixtures and equipment 5,728,827
5,357,701
5,172,488
Total property at cost $ 10,471,212
$ 9,968,308
$ 9,613,402
Less accumulated depreciation and amortization 5,305,337
4,962,255
4,755,118
Net property at cost $ 5,165,875
$ 5,006,053
$ 4,858,284

Depreciation expense was ~~$203.6~~$214.5 million for the three months ended ~~November~~August 3, ~~2018~~2019 and ~~$186.9~~$204.2 million for the three months ended ~~October 28, 2017.~~August 4, 2018. Depreciation expense was ~~$601.5~~$424.2 million for the ~~nine~~six months ended ~~November~~August 3, ~~2018~~2019 and ~~$534.0~~$397.9 million for the ~~nine~~six months ended ~~October 28, 2017. Depreciation expense was $726.0 million for the twelve months ended February 3,~~August 4, 2018.

Note C. Accumulated Other Comprehensive Income (Loss)

Amounts included in accumulated other comprehensive ~~income (loss)~~loss are recorded net of taxes. The following table details the changes in accumulated other comprehensive ~~income (loss)~~loss for the ~~nine~~twelve months ended ~~November~~February 2, 2019 and the six months ended August 3, ~~2018:~~2019:



In thousands	Foreign Currency Translation			Deferred Benefit Costs			Cash Flow Hedge on Debt			Accumulated Other Comprehensive Income (Loss)
Balance, February 3, 2018	$	(280,051	)	$	(159,562	)	$	(2,246	)	$	(441,859	)
Additions to other comprehensive loss:
Foreign currency translation adjustments (net of taxes of $8,233)	(192,664		)	—			—			(192,664		)
Recognition of net gains/losses on investment hedges (net of taxes $7,113)	19,538			—			—			19,538
Recognition of net gains/losses on benefit obligations (net of taxes of $19,813)	—			(54,420		)	—			(54,420		)
Pension settlement charge (net of taxes of $9,641)	—			26,481			—			26,481
Reclassifications from other comprehensive loss to net income:
Amortization of loss on cash flow hedge (net of taxes of $304)	—			—			847			847
Amortization of prior service cost and deferred gains/losses (net of taxes of $4,280)	—			11,756			—			11,756
Balance, February 2, 2019	$	(453,177	)	$	(175,745	)	$	(1,399	)	$	(630,321	)
Additions to other comprehensive loss:
Foreign currency translation adjustments (net of taxes of $952)	(90,904		)	—			—			(90,904		)
Reclassifications from other comprehensive loss to net income:
Amortization of prior service cost and deferred gains/losses (net of taxes of $2,906)	—			7,984			—			7,984
Amortization of loss on cash flow hedge (net of taxes of $152)	—			—			416			416
Balance, August 3, 2019	$	(544,081	)	$	(167,761	)	$	(983	)	$	(712,825	)

In thousands
Foreign
Currency
Translation

Deferred
Benefit
Costs

Cash
Flow
Hedge
on Debt

Accumulated
Other
Comprehensive
Income (Loss)
Balance, January 28, 2017 $ (491,803 ) $ (199,481 ) $ (2,942 ) $ (694,226 )
Additions to other comprehensive income:
Foreign currency translation adjustments (net of taxes of $16,212) 79,393
—
—
79,393
Reclassifications from other comprehensive income to net income:
Amortization of loss on cash flow hedge (net of taxes of $337) —
—
513
513
Amortization of prior service cost and deferred gains/losses (net of taxes of $7,500) —
11,401
—
11,401
Balance, October 28, 2017 $ (412,410 ) $ (188,080 ) $ (2,429 ) $ (602,919 )

Balance, February 3, 2018 $ (280,051 ) $ (159,562 ) $ (2,246 ) $ (441,859 )
Additions to other comprehensive income:
Foreign currency translation adjustments (net of taxes of $13,582) (200,319 ) —
—
(200,319 )
Net investment hedges (net of taxes of $7,113) 19,539
—
—
19,539
Recognition of net gains/losses on benefit obligations,(net of taxes of $1,867) —
(5,128 ) —
(5,128 )
Reclassifications from other comprehensive income to net income:
Pension settlement charge (net of taxes of $9,641) —
26,481
—
26,481
Amortization of prior service cost and deferred gains (net of taxes of $3,210) —
8,817
—
8,817
Amortization of loss on cash flow hedge (net of taxes of $228) —
—
622
622
Balance, November 3, 2018 $ (460,831 ) $ (129,392 ) $ (1,624 ) $ (591,847 )

Note D. Capital Stock and Earnings Per Share

Capital Stock

~~On September 17, 2018, TJX announced that its Board of Directors approved~~In fiscal 2019, we completed a ~~two-for-one~~2-for-one stock split of ~~its~~the Company’s common stock in the form of a stock dividend. The split was subject to shareholder approval of an increase in the number of authorized shares of common stock. On October 22, 2018 the shareholders approved an increase in the number of authorized shares of common stock by 0.6 billion to 1.8 billion. One additional share was paid for each share held by ~~the~~ holders of record as of the close of business on October 30, 2018. The shares were distributed on November 6, 2018 and resulted in anthe issuance of 617 million shares of common stock. ~~The balance sheet as~~In connection with our stock split, the shareholders approved an increase in the number of ~~November 3, 2018~~authorized shares of common stock of 0.6 billion to 1.8 billion shares. As a result, the Consolidated Balance Sheets and ~~all periods presented~~the Consolidated Statements of Shareholders' Equity have been adjusted retroactively to ~~retroactively present~~reflect the two-for-one stock split. ~~As of November 3, 2018,~~In addition, all historical per share amounts and references to ~~the~~ common stock activity, as well as basic and diluted share amounts utilized in the calculation of earnings per share ~~and dividends per share,~~in these notes to the Consolidated Financial Statements, have been adjusted to reflect ~~the~~this stock split.

TJX repurchased and retired ~~11.4~~5.6 million shares of its common stock at a cost of ~~$0.6 billion~~$300 million during the quarter ended ~~November~~August 3, ~~2018,~~2019, on a “trade date” basis. During the ~~nine~~six months ended ~~November~~August 3, ~~2018,~~2019, TJX repurchased and retired ~~34.0~~12.3 million shares of its common stock at a cost of ~~$1.6 billion,~~$650 million, on a "trade date" basis. TJX reflects stock repurchases in its ~~financial statements~~Consolidated Financial Statements on a “settlement date” or cash basis. TJX had cash expenditures under repurchase programs of ~~$1.6 billion~~$700 million for the ~~nine~~six months ended ~~November~~August 3, ~~2018,~~2019, and ~~$1.2 billion~~$990 million for the ~~nine~~six months ended ~~October 28, 2017.~~August 4, 2018. These expenditures were funded by cash generated from current and prior period operations.

In February ~~2017,~~2019, TJX announced that its Board of Directors had approved an additional stock repurchase program that authorized the repurchase of up to ~~$1.0~~$1.5 billion of TJX common stock from time to time. ~~Under this program, which was completed during the third quarter of fiscal 2019, TJX repurchased 21.9 million shares of common stock at a cost of $1.0 billion, on a “trade date” basis.~~

In February 2018, ~~TJX announced that its~~our Board of Directors ~~had~~ approved ~~an additional stock repurchase program that authorized~~ the repurchase of ~~up to~~an additional $3.0 billion of TJX common stock from time to time. Under this program, on a “trade date” basis through ~~November~~August 3, ~~2018,~~2019, TJX repurchased ~~8.6~~38.7 million shares of common stock at a cost of ~~$464 million.~~ $2.0 billion.

As of ~~November~~August 3, ~~2018,~~2019, TJX had approximately $2.5 billion available under ~~the~~these previously announced stock repurchase ~~program announced in February, 2018.~~programs.

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

Earnings Per Share

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



	Thirteen Weeks Ended				Twenty-Six Weeks Ended
In thousands, except per share amounts	August 3, 2019		August 4, 2018		August 3, 2019		August 4, 2018
Basic earnings per share
Net income	$	758,962	$	739,626	$	1,459,140	$	1,456,007
Weighted average common shares outstanding for basic EPS	1,210,525		1,246,851		1,212,528		1,250,037
Basic earnings per share	$	0.63	$	0.59	$	1.20	$	1.16
Diluted earnings per share
Net income	$	758,962	$	739,626	$	1,459,140	$	1,456,007
Shares for basic and diluted earnings per share calculations:
Weighted average common shares outstanding for basic EPS	1,210,525		1,246,851		1,212,528		1,250,037
Assumed exercise/vesting of stock options and awards	18,461		19,069		18,683		17,330
Weighted average common shares outstanding for diluted EPS	1,228,986		1,265,920		1,231,211		1,267,367
Diluted earnings per share	$	0.62	$	0.58	$	1.19	$	1.15
Cash dividends declared per share	$	0.230	$	0.195	$	0.460	$	0.390

Thirteen Weeks Ended Thirty-Nine Weeks Ended
In thousands, except per share data November 3,
2018 October 28,
2017 November 3,
2018 October 28,
2017
Basic earnings per share
Net income $ 762,253
$ 641,436
$ 2,218,260
$ 1,730,672
Weighted average common shares outstanding for basic EPS 1,236,842
1,268,044
1,245,639
1,278,383
Basic earnings per share $ 0.62
$ 0.51
$ 1.78
$ 1.35
Diluted earnings per share
Net income $ 762,253
$ 641,436
$ 2,218,260
$ 1,730,672
Shares for basic and diluted earnings per share calculations:
Weighted average common shares outstanding for basic EPS 1,236,842
1,268,044
1,245,639
1,278,383
Assumed exercise/vesting of:
Stock options and awards 20,720
17,718
18,461
18,961
Weighted average common shares outstanding for diluted EPS 1,257,562
1,285,762
1,264,100
1,297,344
Diluted earnings per share $ 0.61
$ 0.50
$ 1.75
$ 1.33
Cash dividends declared per share $ 0.195
$ 0.156
$ 0.585
$ 0.469

The weighted average common shares for the diluted earnings per share calculation exclude the impact of outstanding stock options if the assumed proceeds per share of the option is in excess of the average price of TJX’s common stock for the related fiscal periods. Such options are excluded because they would have an antidilutive effect. There were ~~6.1~~5.9 million such options excluded for each of the thirteen weeks and ~~thirty-nine~~twenty-six weeks ended ~~November~~August 3, ~~2018.~~2019. There were ~~25.2 million~~0 such options excluded for each of the thirteen weeks and ~~thirty-nine~~twenty-six weeks ended ~~October 28, 2017.~~August 4, 2018.

Note E. Financial Instruments

As a result of its operating and financing activities, TJX is exposed to market risks from changes in interest and foreign currency exchange rates and fuel costs. These market risks may adversely affect TJX’s operating results and financial position. TJX seeks to minimize risk from changes in interest and foreign currency exchange rates and fuel costs through the use of derivative financial instruments when and to the extent deemed appropriate. TJX does not use derivative financial instruments for trading or other speculative purposes and does not use any leveraged derivative financial instruments. TJX recognizes all derivative instruments as either assets or liabilities in the ~~statements of financial position~~Consolidated Balance Sheets and measures those instruments at fair value. The fair values of the derivatives are classified as assets or liabilities, current or non-current, based upon valuation results and settlement dates of the individual contracts. Changes to the fair value of derivative contracts that do not qualify for hedge accounting are reported in earnings in the period of the change. For derivatives that qualify for hedge accounting, changes in the fair value of the derivatives are either recorded in shareholders’ equity as a component of other comprehensive income or are recognized currently in earnings, along with an offsetting adjustment against the basis of the item being hedged.

Diesel Fuel Contracts

TJX hedges portions of its estimated notional diesel requirements based on the diesel fuel expected to be consumed by independent freight carriers transporting TJX’s inventory. Independent freight carriers transporting TJX’s inventory charge TJX a mileage surcharge based on the price of diesel fuel. The hedge agreements are designed to mitigate the volatility of diesel fuel pricing (and the resulting per mile surcharges payable by TJX) by setting a fixed price per gallon for the period being hedged. During fiscal ~~2018,~~2019, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for fiscal ~~2019,~~2020, and during the first ~~nine~~six months of fiscal ~~2019,~~2020, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for the first ~~nine~~six months of fiscal ~~2020.~~2021. The hedge agreements outstanding at ~~November~~August 3, ~~2018~~2019 relate to approximately ~~46%~~50% of TJX’s estimated notional diesel requirements for the remainder of fiscal ~~2019~~2020 and approximately ~~28%~~49% of TJX’s estimated notional diesel requirements for the first ~~nine~~six months of fiscal ~~2020.~~2021. These diesel fuel hedge agreements will settle throughout the remainder of fiscal ~~2019~~2020 and throughout the first ~~ten~~seven months of fiscal ~~2020.~~2021. TJX elected not to apply hedge accounting to these contracts.

Foreign Currency Contracts

TJX enters into forward foreign currency exchange contracts to obtain economic hedges on portions of merchandise purchases made and anticipated to be made by the Company’s operations in TJX International (United Kingdom, Ireland, Germany, Poland, Austria, The Netherlands and Australia), TJX Canada (Canada), Marmaxx (U.S.) and HomeGoods (U.S.) in currencies other than their respective functional currencies. These contracts typically have a term of twelve months or less. The contracts outstanding at ~~November~~August 3, ~~2018~~2019 cover a portion of such actual and anticipated merchandise purchases throughout the remainder ~~of fiscal 2019 and throughout the first half~~ of fiscal 2020. Additionally, TJX’s operations in Europe are subject to foreign currency exposure as a result of their buying function being centralized in the United Kingdom. All merchandise is purchased centrally in the U.K. and then shipped and billed to the retail entities in other countries. This intercompany billing to TJX’s European businesses’ Euro denominated operations creates exposure to the central buying entity for changes in the exchange rate between the Euro and British Pound. The inflow of Euros to the central buying entity provides a natural hedge for merchandise purchased from third-party vendors that is denominated in Euros. However, with the growth of TJX’s Euro denominated retail operations, the intercompany billings committed to the Euro denominated operations is generating Euros in excess of those needed to meet merchandise commitments to outside vendors. TJX calculates this excess Euro exposure each month and enters into forward contracts of approximately 30 ~~days~~days' duration to mitigate the exposure. During the six months ended August 3, 2019, TJX entered into derivative contracts to hedge Polish leases that are denominated in Euros and paid in Zlotys in order to mitigate the foreign currency exposure as a result of implementing ASU No. 2016-02, Leases. TJX elected not to apply hedge accounting to these contracts.

TJX also enters into derivative contracts, generally designated as fair value hedges, to hedge intercompany debt, certain intercompany dividends and intercompany interest payable. The changes in fair value of these contracts are recorded in selling, general and administrative expenses and are offset by marking the underlying item to fair value in the same period. Upon settlement, the realized gains and losses on these contracts are offset by the realized gains and losses of the underlying item in selling, general and administrative expenses.

TJX periodically reviews its net investments in foreign subsidiaries. During the fiscal quarter ended May 5, 2018, TJX entered into net investment hedge contracts related to a portion of its investment in TJX Canada. During the fiscal quarter ended August 4, 2018, TJX de-designated the net investment hedge contracts. The remaining life of the foreign currency contracts provided a natural hedge to the declared cash dividend from TJX Canada. The contracts settled during the second quarter of fiscal 2019 resulting in a pre-tax gain of $27 million while designated as a net investment hedge and subsequent to de-designation, a pre-tax gain of $19 million. The $27 million gain is reflected in ~~shareholders~~shareholders' equity as a component of other comprehensive income. The $19 million gain subsequent to de-designation is reflected in the income statement offsetting a foreign currency loss of $18 million on the declared dividends.

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at ~~November~~August 3, ~~2018:~~2019:


In thousands		Pay	Receive		Blended Contract Rate	Balance Sheet Location	Current Asset U.S.$		Current (Liability) U.S.$			Net Fair Value in U.S.$ at November 3, 2018			In thousands	Pay	Receive		Blended Contract Rate	Balance Sheet Location	Current Asset U.S.$		Current (Liability) U.S.$			Net Fair Value in U.S.$ at August 3, 2019
Fair value hedges:	Fair value hedges:														Fair value hedges:
Intercompany balances, primarily debt and related interest
Intercompany balances, primarily debt and related interest:															Intercompany balances, primarily debt and related interest:
	zł	62,000	£	12,983	0.2094	Prepaid Exp	$	475	$	—		$	475		zł	64,000	£	13,055	0.2040	(Accrued Exp)	$	—	$	(585	)	$	(585	)
	€	48,950	£	43,612	0.8909	Prepaid Exp	626		—			626			€	55,950	£	49,560	0.8858	(Accrued Exp)	—		(2,208		)	(2,208		)
	A$	30,000	U.S.$	21,207	0.7069	(Accrued Exp)	—		(429		)	(429		)	A$	40,000	U.S.$	28,249	0.7062	Prepaid Exp	944		—			944
	U.S.$	77,079	£	55,000	0.7136	(Accrued Exp)	—		(5,545		)	(5,545		)	U.S.$	72,020	£	55,000	0.7637	(Accrued Exp)	—		(4,785		)	(4,785		)
Economic hedges for which hedge accounting was not elected:	Economic hedges for which hedge accounting was not elected:														Economic hedges for which hedge accounting was not elected:
Diesel contracts		Fixed on 1.3M – 3.0M gal per month		Float on 1.3M – 3.0M gal per month	N/A	Prepaid Exp	4,965		—			4,965
Intercompany billings in Europe, primarily merchandise related
	€	82,000	£	71,853	0.8763	(Accrued Exp)	—		(231		)	(231		)	Diesel fuel contracts	Fixed on 2.7M – 3.3M gal per month		Float on 2.7M – 3.3M gal per month	N/A	(Accrued Exp)	—		(6,575		)	(6,575		)
Merchandise purchase commitments
Intercompany billings in TJX International, primarily merchandise related:															Intercompany billings in TJX International, primarily merchandise related:
															€	89,000	£	80,029	0.8992	(Accrued Exp)	—		(1,687		)	(1,687		)
Lease liability in TJX International:															Lease liability in TJX International:
															zł	330,044	€	77,479	0.2348	Prepaid Exp	866		—			866
Merchandise purchase commitments:															Merchandise purchase commitments:
	C$	582,670	U.S.$	447,800	0.7685	Prepaid Exp / (Accrued Exp)	3,216		(543		)	2,673			C$	702,924	U.S.$	529,750	0.7536	Prepaid Exp / (Accrued Exp)	1,323		(4,800		)	(3,477		)
	C$	29,614	€	19,500	0.6585	Prepaid Exp / (Accrued Exp)	4		(342		)	(338		)	C$	38,119	€	25,400	0.6663	(Accrued Exp)	—		(592		)	(592		)
	£	271,690	U.S.$	369,500	1.3600	Prepaid Exp / (Accrued Exp)	15,585		(132		)	15,453			£	313,490	U.S.$	403,600	1.2874	Prepaid Exp / (Accrued Exp)	20,418		(12		)	20,406
	U.S.$	2,692	£	2,067	0.7678	Prepaid Exp / (Accrued Exp)	15		(28		)	(13		)	A$	32,229	U.S.$	22,665	0.7032	Prepaid Exp	690		—			690
	A$	45,132	U.S.$	32,962	0.7303	Prepaid Exp / (Accrued Exp)	441		(21		)	420			zł	418,012	£	85,810	0.2053	(Accrued Exp)	—		(3,267		)	(3,267		)
	zł	289,208	£	59,158	0.2046	Prepaid Exp / (Accrued Exp)	744		(373		)	371			U.S.$	3,834	£	3,052	0.7960	(Accrued Exp)	—		(120		)	(120		)
	U.S.$	67,459	€	57,065	0.8459	(Accrued Exp)	—		(2,235		)	(2,235		)	U.S.$	79,010	€	69,427	0.8787	(Accrued Exp)	—		(1,567		)	(1,567		)
Total fair value of derivative financial instruments	Total fair value of derivative financial instruments						$	26,071	$	(9,879	)	$	16,192		Total fair value of derivative financial instruments						$	24,241	$	(26,198	)	$	(1,957	)

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at February ~~3, 2018:~~

2, 2019:

In thousands Pay Receive
Blended
Contract
Rate
Balance Sheet
Location
Current
Asset
U.S.$
Current
(Liability)
U.S.$
Net Fair
Value in
U.S.$ at
February 3,
2018
Fair value hedges:
Intercompany balances, primarily debt and related interest
zł 67,000
£ 14,035
0.2095
(Accrued Exp) $ —
$ (45 ) $ (45 )
€ 51,950
£ 46,095
0.8873
(Accrued Exp) —
(318 ) (318 )
U.S.$ 77,079
£ 55,000
0.7136
Prepaid Exp 1,636
—
1,636
Economic hedges for which hedge accounting was not elected:
Diesel contracts
Fixed on
2.2M – 3.0M
gal per month Float on
2.2M– 3.0M
gal per month N/A
Prepaid Exp 7,854
—
7,854
Intercompany billings in TJX Europe, primarily merchandise related
€ 26,000
£ 22,948
0.8826
(Accrued Exp) —
(2 ) (2 )
Merchandise purchase commitments
C$ 462,464
U.S.$ 367,200
0.7940
Prepaid Exp /
(Accrued Exp) 49
(5,478 ) (5,429 )
C$ 22,562
€ 15,000
0.6648
Prepaid Exp 557
—
557
£ 176,911
U.S.$ 238,000
1.3453
Prepaid Exp /
(Accrued Exp) 173
(12,838 ) (12,665 )
zł 288,646
£ 60,023
0.2079
(Accrued Exp) —
(1,303 ) (1,303 )
A$ 28,635
U.S.$ 22,230
0.7763
Prepaid Exp /
(Accrued Exp) 43
(573 ) (530 )
U.S.$ 44,223
€ 36,950
0.8355
Prepaid Exp 1,905
—
1,905
Total fair value of financial instruments $ 12,217
$ (20,557 ) $ (8,340 )



In thousands		Pay	Receive		Blended Contract Rate	Balance Sheet Location	Current Asset U.S.$		Current (Liability) U.S.$			Net Fair Value in U.S.$ at February 2, 2019
Fair value hedges:
Intercompany balances, primarily debt and related interest:
	zł	59,000	£	12,021	0.2037	Prepaid Exp	$	56	$	—		$	56
	€	55,950	£	49,560	0.8858	Prepaid Exp / (Accrued Exp)	126		(140		)	(14		)
	A$	30,000	U.S.$	21,483	0.7161	(Accrued Exp)	—		(314		)	(314		)
	U.S.$	72,020	£	55,000	0.7637	Prepaid Exp	1,037		—			1,037
Economic hedges for which hedge accounting was not elected:
	Diesel fuel contracts	Fixed on 2.7M – 3.3M gal per month		Float on 2.7M– 3.3M gal per month	N/A	(Accrued Exp)	—		(3,786		)	(3,786		)
Intercompany billings in TJX International, primarily merchandise related:
	€	46,600	£	41,835	0.8977	Prepaid Exp	1,300		—			1,300
Merchandise purchase commitments:
	C$	546,083	U.S.$	414,100	0.7583	Prepaid Exp / (Accrued Exp)	1,239		(4,741		)	(3,502		)
	C$	31,455	€	20,700	0.6581	(Accrued Exp)	—		(248		)	(248		)
	£	173,624	U.S.$	230,000	1.3247	Prepaid Exp / (Accrued Exp)	3,459		(1,466		)	1,993
	zł	280,167	£	57,586	0.2055	Prepaid Exp / (Accrued Exp)	707		(86		)	621
	A$	51,043	U.S.$	36,961	0.7241	Prepaid Exp / (Accrued Exp)	97		(213		)	(116		)
	U.S.$	56,847	€	49,355	0.8682	Prepaid Exp / (Accrued Exp)	115		(207		)	(92		)
Total fair value of derivative financial instruments							$	8,136	$	(11,201	)	$	(3,065	)

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at ~~October 28, 2017:~~August 4, 2018:



In thousands		Pay	Receive		Blended Contract Rate	Balance Sheet Location	Current Asset U.S.$		Current (Liability) U.S.$			Net Fair Value in U.S.$ at August 4, 2018
Fair value hedges:
Intercompany balances, primarily debt and related interest:
	zł	67,000	£	14,035	0.2095	Prepaid Exp	$	141	$	—		$	141
	€	53,950	£	47,868	0.8873	(Accrued Exp)	—		(518		)	(518		)
	£	30,000	C$	54,038	1.8013	Prepaid Exp	2,484		—			2,484
	U.S.$	77,079	£	55,000	0.7136	(Accrued Exp)	—		(5,097		)	(5,097		)
	A$	10,000	£	5,631	0.5631	(Accrued Exp)	—		(64		)	(64		)
Economic hedges for which hedge accounting was not elected:
	Diesel fuel contracts	Fixed on 2.3M – 3.0M gal per month		Float on 2.3M – 3.0M gal per month	N/A	Prepaid Exp	6,864		—			6,864
Intercompany billings in TJX International, primarily merchandise related:
	€	76,000	£	67,192	0.8841	(Accrued Exp)	—		(672		)	(672		)
Merchandise purchase commitments:
	C$	621,719	U.S.$	481,300	0.7741	Prepaid Exp / (Accrued Exp)	4,913		(2,940		)	1,973
	C$	35,433	€	23,000	0.6491	(Accrued Exp)	—		(610		)	(610		)
	£	351,964	U.S.$	488,400	1.3876	Prepaid Exp	28,329		—			28,329
	U.S.$	3,274	£	2,475	0.7560	(Accrued Exp)	—		(49		)	(49		)
	A$	33,867	U.S.$	25,327	0.7478	Prepaid Exp / (Accrued Exp)	229		(16		)	213
	zł	355,038	£	72,479	0.2041	(Accrued Exp)	—		(1,889		)	(1,889		)
	U.S.$	74,329	€	61,929	0.8332	(Accrued Exp)	—		(2,336		)	(2,336		)
Total fair value of derivative financial instruments							$	42,960	$	(14,191	)	$	28,769

In thousands Pay Receive
Blended
Contract
Rate
Balance Sheet
Location
Current
Asset
U.S.$
Current
(Liability)
U.S.$
Net Fair
Value in
U.S.$ at
October 28, 2017
Fair value hedges:
Intercompany balances, primarily debt and related interest
zł 67,000
£ 13,000
0.1940
(Accrued Exp) $ —
$ (1,211 ) $ (1,211 )
€ 49,950
£ 43,317
0.8672
Prepaid Exp /(Accrued Exp) 277
(1,600 ) (1,323 )
U.S.$ 68,445
£ 55,000
0.8036
Prepaid Exp 3,849
—
3,849
Economic hedges for which hedge accounting was not elected:
Diesel contracts
Fixed on 250K – 2.5M gal per month Float on 250K – 2.5M gal per month
N/A
Prepaid Exp 5,226
—
5,226
Intercompany billings in Europe, primarily merchandise related
€ 27,000
£ 24,062
0.8912
Prepaid Exp 202

202
Merchandise purchase commitments
C$ 511,004
U.S.$ 399,650
0.7821
Prepaid Exp /
(Accrued Exp) 5,023
(4,770 ) 253
C$ 25,305
€ 17,000
0.6718
Prepaid Exp /
(Accrued Exp) 63
(62 ) 1
£ 163,682
U.S.$ 214,000
1.3074
Prepaid Exp /
(Accrued Exp) 678
(2,298 ) (1,620 )
A$ 27,187
U.S.$ 21,351
0.7853
Prepaid Exp 467
—
467
zł 313,150
£ 65,249
0.2084
Prepaid Exp /
(Accrued Exp) 580
(350 ) 230
U.S.$ 2,928
£ 2,245
0.7667 Prepaid Exp 16
—
16
U.S.$ 68,723
€ 58,859
0.8565
Prepaid Exp /
(Accrued Exp) 729
(989 ) (260 )
Total fair value of financial instruments $ 17,110
$ (11,280 ) $ 5,830

Presented below is the impact of derivative financial instruments on the ~~statements~~Consolidated Statements of ~~income~~Income for the periods shown:



		Amount of Gain (Loss) Recognized in Income by Derivative
	Location of Gain (Loss) Recognized in Income by Derivative	Thirteen Weeks Ended						Twenty-Six Weeks Ended
In thousands		August 3, 2019			August 4, 2018			August 3, 2019			August 4, 2018
Fair value hedges:
Intercompany balances, primarily debt and related interest	Selling, general and administrative expenses	$	(10,345	)	$	(2,418	)	$	(6,712	)	$	(4,210	)
Economic hedges for which hedge accounting was not elected:
Intercompany receivable	Selling, general and administrative expenses	—			18,823			3,257			18,823
Diesel fuel contracts	Cost of sales, including buying and occupancy costs	(6,319		)	1,005			(2,632		)	5,958
Intercompany billings in TJX International, primarily merchandise related	Cost of sales, including buying and occupancy costs	(6,351		)	(576		)	(4,200		)	(694		)
International lease liabilities	Cost of sales, including buying and occupancy costs	108			—			(1,414		)	—
Merchandise purchase commitments	Cost of sales, including buying and occupancy costs	17,369			21,171			27,158			52,628
Gain / (loss) recognized in income		$	(5,538	)	$	38,005		$	15,457		$	72,505

Amount of Gain (Loss) Recognized
in Income by Derivative

Amount of Gain (Loss) Recognized
in Income by Derivative
Thirteen Weeks Ended Thirty-Nine Weeks Ended
In thousands
Location of Gain (Loss)
Recognized in Income by
Derivative
November 3, 2018 October 28,
2017 November 3,
2018 October 28,
2017
Fair value hedges:
Intercompany balances, primarily debt and related interest Selling, general and administrative expenses $ 672
$ (1,454 ) $ (3,538 ) $ (3,820 )
Economic hedges for which hedge accounting was not elected:
Intercompany receivable Selling, general and administrative expenses —
—
18,823
—
Diesel fuel contracts Cost of sales, including buying and occupancy costs 1,572
4,947
7,530
3,630
Intercompany billings in Europe,
primarily merchandise related
Cost of sales, including buying and occupancy costs 1,718
328
1,024
(3,116 )
Merchandise purchase commitments Cost of sales, including buying and occupancy costs 8,463
13,336
61,091
(20,829 )
Gain / (loss) recognized in income $ 12,425
$ 17,157
$ 84,930
$ (24,135 )

Note F. Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date or “exit price.” The inputs used to measure fair value are generally classified into the following hierarchy:



Level 1:		Unadjusted quoted prices in active markets for identical assets or liabilities

Level 2:		Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability

Level 3:		Unobservable inputs for the asset or liability

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



In thousands	August 3, 2019		February 2, 2019		August 4, 2018
Level 1
Assets:
Executive Savings Plan investments	$	282,548	$	253,215	$	258,798
Level 2
Assets:
Foreign currency exchange contracts	24,241		8,136		36,096
Diesel fuel contracts	—		—		6,864
Liabilities:
Foreign currency exchange contracts	$	19,623	$	7,415	$	14,191
Diesel fuel contracts	6,575		3,786		—

In thousands November 3,
2018 February 3,
2018 October 28,
2017
Level 1
Assets:
Executive Savings Plan investments $ 245,856
$ 249,045
$ 231,618
Level 2
Assets:
Short-term investments $ —
$ 506,165
$ 511,618
Foreign currency exchange contracts 21,106
4,363
11,884
Diesel fuel contracts 4,965
7,854
5,226
Liabilities:
Foreign currency exchange contracts $ 9,879
$ 20,557
$ 11,280

Investments designed to meet obligations under the Executive Savings Plan are invested in registered investment companies traded in active markets and are recorded at unadjusted quoted prices.

~~Short-term investments, foreign~~Foreign currency exchange contracts and diesel fuel contracts are valued using broker quotations, which include observable market information. TJX’s investments are primarily high-grade commercial paper, institutional money market funds and time deposits with major banks. TJX does not make adjustments to quotes or prices obtained from brokers or pricing services but does assess the credit risk of counterparties and will adjust final valuations when appropriate. Where independent pricing services provide fair values, TJX obtains an understanding of the methods used in pricing. As such, these instruments are classified within Level 2.

The fair value of TJX’s general corporate debt was estimated by obtaining market quotes given the trading levels of other bonds of the same general issuer type and market perceived credit quality. These inputs are considered to be Level 2. The fair value of long-term debt as of ~~November~~August 3, ~~2018~~2019 was ~~$2.1~~$2.3 billion compared to a carrying value of $2.2 billion. The fair value of long-term debt as of February ~~3, 2018 was $2.2 billion compared to a~~2, 2019 approximated the carrying value of $2.2 billion. The fair value of long-term debt as of ~~October 28, 2017~~August 4, 2018 was ~~$2.2~~$2.1 billion compared to a carrying value of $2.2 billion. These estimates do not necessarily reflect provisions or restrictions in the various debt agreements that might affect TJX’s ability to settle these obligations.

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

Note G. Segment Information

TJX operates ~~four~~4 main business segments. The Marmaxx segment (T.J. Maxx, Marshalls and tjmaxx.com) and the HomeGoods segment (HomeGoods and Homesense) both operate in the United States, the TJX Canada segment operates Winners, HomeSense and Marshalls in Canada, and the TJX International segment operates T.K. Maxx, Homesense and tkmaxx.com in Europe and T.K. Maxx in Australia. ~~We also operate~~In addition to our 4 main business segments, Sierra ~~Trading Post (“STP”), an off-price retailer that includes sierratradingpost.com along with a number of~~operates sierra.com and retail stores in the U.S. ~~We currently consider all of STP as part of our e-commerce operations.~~ The results of ~~STP~~Sierra are included in the Marmaxx segment.

All of TJX’s stores, with the exception of HomeGoods and Homesense, sell family apparel and home fashions. HomeGoods and Homesense offer home fashions.

TJX evaluates the performance of its segments based on “segment profit or loss,” which it defines as pre-tax income or loss before general corporate expense ~~pension settlement charge~~ and interest expense, net. “Segment profit or loss,” as defined by TJX, may not be comparable to similarly titled measures used by other entities. The terms “segment margin” or “segment profit margin” are used to describe segment profit or loss as a percentage of net sales. These measures of performance should not be considered alternatives to net income or cash flows from operating activities as an indicator of TJX’s performance or as a measure of liquidity.

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



	Thirteen Weeks Ended				Twenty-Six Weeks Ended
In thousands	August 3, 2019		August 4, 2018		August 3, 2019		August 4, 2018
Net sales:
In the United States:
Marmaxx	$	6,106,697	$	5,847,721	$	11,908,457	$	11,228,639
HomeGoods	1,424,836		1,327,346		2,821,701		2,596,677
TJX Canada	967,460		937,736		1,815,195		1,791,572
TJX International	1,282,603		1,218,312		2,513,828		2,402,947
	$	9,781,596	$	9,331,115	$	19,059,181	$	18,019,835
Segment profit:
In the United States:
Marmaxx	$	855,199	$	830,315	$	1,651,192	$	1,580,771
HomeGoods	128,942		142,090		265,727		289,450
TJX Canada	118,217		138,735		215,249		263,919
TJX International	50,459		48,691		78,946		89,517
	1,152,817		1,159,831		2,211,114		2,223,657
General corporate expense	128,613		164,245		249,611		268,365
Interest expense, net	2,897		3,029		3,714		7,177
Income before provision for income taxes	$	1,021,307	$	992,557	$	1,957,789	$	1,948,115

Thirteen Weeks Ended Thirty-Nine Weeks Ended
In thousands November 3,
2018 October 28,
2017 November 3,
2018 October 28,
2017
Net sales:
In the United States:
Marmaxx $ 5,973,476
$ 5,298,479
$ 17,202,115
$ 15,550,253
HomeGoods 1,463,892
1,228,768
4,060,569
3,506,435
TJX Canada 1,036,884
983,236
2,828,456
2,554,033
TJX International 1,351,507
1,251,737
3,754,454
3,293,223
$ 9,825,759
$ 8,762,220
$ 27,845,594
$ 24,903,944
Segment profit:
In the United States:
Marmaxx $ 762,911
$ 666,092
$ 2,343,682
$ 2,100,138
HomeGoods 166,090
163,835
455,540
457,272
TJX Canada 182,170
206,472
446,089
392,581
TJX International 102,432
87,066
191,949
132,893
1,213,603
1,123,465
3,437,260
3,082,884
General corporate expense 127,775
95,484
396,140
311,177
Pension settlement charge 36,122
—
36,122
—
Interest expense, net 3,188
7,981
10,365
27,499
Income before provision for income taxes $ 1,046,518
$ 1,020,000
$ 2,994,633
$ 2,744,208

Segment assets as of August 3, 2019 increased from February 2, 2019 due to inclusion of operating lease right of use assets in segment assets. As of August 3, 2019, the breakdown of the Company’s operating right of use assets by segment is $4.5 billion in Marmaxx, $1.4 billion in HomeGoods, $1.0 billion in TJX Canada and $2.0 billion in TJX International.

Note H. Pension Plans and Other Retirement Benefits

Presented below is financial information relating to TJX’s funded defined benefit pension plan (“qualified pension plan” or “funded plan”) and its unfunded supplemental pension plan (“unfunded plan”) for the periods shown:



	Funded Plan						Unfunded Plan
	Thirteen Weeks Ended						Thirteen Weeks Ended
In thousands	August 3, 2019			August 4, 2018			August 3, 2019		August 4, 2018
Service cost	$	11,049		$	11,613		$	552	$	611
Interest cost	12,990			13,965			967		853
Expected return on plan assets	(18,488		)	(20,962		)	—		—
Recognized actuarial losses	4,509			3,114			936		821
Total expense	$	10,060		$	7,730		$	2,455	$	2,285

Funded Plan Unfunded Plan
Thirteen Weeks Ended Thirteen Weeks Ended
In thousands November 3,
2018 October 28,
2017 November 3,
2018 October 28,
2017
Service cost $ 10,781
$ 11,655
$ 572
$ 403
Interest cost 12,837
13,866
994
820
Expected return on plan assets (17,468 ) (17,309 ) —
—
Recognized actuarial losses 3,241
5,428
914
641
Expense related to current period $ 9,391
$ 13,640
$ 2,480
$ 1,864
Pension settlement charge 36,122
—
—
—
Total expense $ 45,513
$ 13,640
$ 2,480
$ 1,864


	Funded Plan						Unfunded Plan				Funded Plan						Unfunded Plan
	Thirty-Nine Weeks Ended						Thirty-Nine Weeks Ended				Twenty-Six Weeks Ended						Twenty-Six Weeks Ended
In thousands	November 3, 2018			October 28, 2017			November 3, 2018		October 28, 2017		August 3, 2019			August 4, 2018			August 3, 2019		August 4, 2018
Service cost	$	34,007		$	35,264		$	1,794	$	1,578	$	22,098		$	23,226		$	1,104	$	1,222
Interest cost	40,767			41,384			2,700		2,506		25,980			27,930			1,934		1,706
Expected return on plan assets	(59,392		)	(52,073		)	—		—		(36,976		)	(41,924		)	—		—
Recognized actuarial losses	9,469			16,582			2,556		2,305		9,018			6,228			1,872		1,642
Expense related to current period	$	24,851		$	41,157		$	7,050	$	6,389
Pension settlement charge	36,122			—			—		—
Total expense	$	60,973		$	41,157		$	7,050	$	6,389	$	20,120		$	15,460		$	4,910	$	4,570

TJX’s policy with respect to the funded plan is to fund, at a minimum, the amount required to maintain a funded status of 80% of the applicable pension liability (the Funding Target pursuant to the Internal Revenue Code section 430) or such other amount as is sufficient to avoid restrictions with respect to the funding of nonqualified plans under the Internal Revenue Code. We do not anticipate any required funding in fiscal ~~2019~~2020 for the funded plan. We anticipate making contributions of ~~$2.5~~$4.8 million to provide current benefits coming due under the unfunded plan in fiscal ~~2019.~~2020.

The amounts included in recognized actuarial losses in the table above have been reclassified in their entirety from ~~other comprehensive income~~AOCI to the ~~statements~~Consolidated Statements of ~~income,~~Income, net of related tax effects, for the periods presented.

During the third quarter of fiscal 2019, TJX annuitized and transferred current pension obligations for certain U.S. retirees and beneficiaries under the funded plan through the purchase of a group annuity contract with an insurance company. TJX transferred $207.4 million of pension plan assets to the insurance company, thereby reducing its pension benefit obligations. The transaction had no cash impact on TJX but did result in a non-cash pre-tax pension settlement charge of $36.1 million, which is reported separately on the consolidated statements of income. As a result of the annuity purchase the Company re-measured the funded status of its pension plan as of September 30, 2018. The assumptions for pension expense presented above includes a discount rate of 4.00% through the measurement date and 4.40% thereafter. The expected rate of return on plan assets is 6.00% through the measurement date and 6.00% thereafter. The discount rate for determining the obligation at the measurement date is 4.40%.

Note I. Long-Term Debt and Credit Lines

The table below presents long-term debt, exclusive of current installments, as of ~~November~~August 3, ~~2018,~~2019, February ~~3, 2018~~2, 2019 and ~~October 28, 2017.~~August 4, 2018. All amounts are net of unamortized debt discounts.



In thousands	August 3, 2019			February 2, 2019			August 4, 2018
General corporate debt:
2.50% senior unsecured notes, maturing May 15, 2023 (effective interest rate of 2.51% after reduction of unamortized debt discount of $167 at August 3, 2019, $189 at February 2, 2019 and $211 at August 4, 2018)	$	499,833		$	499,811		$	499,789
2.75% senior unsecured notes, maturing June 15, 2021 (effective interest rate of 2.76% after reduction of unamortized debt discount of $137 at August 3, 2019, $174 at February 2, 2019 and $212 at August 4, 2018)	749,863			749,826			749,788
2.25% senior unsecured notes, maturing September 15, 2026 (effective interest rate of 2.32% after reduction of unamortized debt discount of $5,284 at August 3, 2019, $5,657 at February 2, 2019 and $6,030 at August 4, 2018)	994,716			994,343			993,970
Debt issuance cost	(9,291		)	(10,364		)	(11,435		)
Long-term debt	$	2,235,121		$	2,233,616		$	2,232,112

In thousands November 3,
2018 February 3,
2018 October 28,
2017
General corporate debt:
2.50% senior unsecured notes, maturing May 15, 2023 (effective interest rate of 2.51% after reduction of unamortized debt discount of $200 at November 3, 2018, $234 at February 3, 2018 and $245 at October 28, 2017) $ 499,800
$ 499,766
$ 499,755
2.75% senior unsecured notes, maturing June 15, 2021 (effective interest rate of 2.76% after reduction of unamortized debt discount of $194 at November 3, 2018, $250 at February 3, 2018 and $269 at October 28, 2017) 749,806
749,750
749,732
2.25% senior unsecured notes, maturing September 15, 2026 (effective interest rate of 2.32% after reduction of unamortized debt discount of $5,844 at November 3, 2018, $6,403 at February 3, 2018 and $6,590 at October 28, 2017) 994,156
993,597
993,410
Debt issuance cost (10,898 ) (12,506 ) (13,042 )
Long-term debt $ 2,232,864
$ 2,230,607
$ 2,229,855

~~As of November 3, 2018, February 3, 2018 and October 28, 2017,~~ TJX ~~had two~~has 2 $500 million revolving credit facilities, one which matures in March ~~2020~~2022 and one which matures in May 2024. During the quarter, the Company amended the 2 agreements to reflect the impact of implementing the new lease accounting standard under ASC 842 related to the definition of rental costs used within the debt covenant calculation. For additional information about the implementation of ASC 842, see Leases within Note A— Basis of Presentation and Summary of Significant Accounting Policies of Notes to Consolidated Financial Statements. In addition, the maturity date for one of the revolving credit facilities was extended from March ~~2022.~~

2020 to May 2024.

The terms and covenants under the revolving credit facilities require quarterly payments of 6.0 basis points per annum on the committed amounts for both agreements. This rate is based on the credit ratings of TJX’s long-term debt and will vary with specified changes in the credit ratings. These agreements have no compensating balance requirements and have various covenants. Each of these facilities require TJX to maintain a ratio of funded debt ~~and four-times consolidated rentals~~ to ~~consolidated~~ earnings before interest, taxes, depreciation and amortization and ~~consolidated~~ rentals (EBITDAR) of not more than ~~2.75~~3.25 to 1.00 on a rolling four-quarter basis. TJX was in compliance with all covenants related to its credit facilities at the end of all periods presented. As of ~~November~~August 3, ~~2018,~~2019, February 3,2, 2019 and August 4, 2018, ~~and October 28, 2017,~~ and during the quarters and year then ended, there were no0 amounts outstanding under these facilities.

As of ~~November~~August 3, ~~2018,~~2019, February 3,2, 2019 and August 4, 2018, ~~and October 28, 2017,~~ TJX Canada had ~~two~~2 uncommitted credit lines, a C$10 million facility for operating expenses and a C$10 million letter of credit facility. As of ~~November~~August 3, ~~2018,~~2019, February 3,2, 2019 and August 4, 2018, and ~~October 28, 2017,~~during the quarters and year then ended, there were no0 amounts outstanding on the Canadian credit line for operating expenses. As of ~~November~~August 3, ~~2018,~~2019, February 3,2, 2019 and August 4, 2018, ~~and October 28, 2017,~~ our European business at TJX International had an1 uncommitted credit line of £5 million. As of ~~November~~August 3, ~~2018,~~2019, February 3,2, 2019 and August 4, 2018, ~~and October 28, 2017,~~ and during the quarters and year then ended, there were no0 amounts outstanding on the European credit line.

Note J. Income Taxes

The effective income tax rate was ~~27.2%~~25.7% for the ~~third~~second quarter of fiscal ~~2019~~2020 and ~~37.1%~~25.5% for the ~~third~~second quarter of fiscal ~~2018.~~2019. The effective income tax rate was ~~25.9%~~25.5% for the first ~~nine~~six months of fiscal ~~2019~~2020 and ~~36.9%~~25.3% for the first ~~nine~~six months of fiscal ~~2018.~~2019. The ~~decrease~~increase in the effective income tax rate was primarily due to the reduction of excess tax benefit from share-based compensation and the ~~U.S. federal corporate tax rate to 21% as~~expanded limitations on executive compensation, offset by a ~~result~~reduction in the impact of the ~~2017 Tax Act and the jurisdictional mix of income.~~

Under ASU 2018-05, we have accounted for the impacts of the 2017 Tax Act to the extent a reasonable estimate could be made and we recognized provisional amounts related to the deemed repatriation tax, offset by the re-measurement of our deferred tax assets and liabilities to record the effects of the tax law change in the period of enactment. This guidance allows a company to record a provisional amount when it does not have the necessary information available, prepared, or analyzed in reasonable detail to complete its accounting for the change in the tax law during the measurement period. The measurement period ends when the company has obtained, prepared, and analyzed the information necessary to finalize its accounting, but cannot extend beyond one year. We will continue to monitor for new guidance related to provisional amounts recorded.foreign operations.

TJX had net unrecognized tax benefits of ~~$65.3~~$241.6 million as of ~~November~~August 3, ~~2018, $57.3~~2019, $233.4 million as of February ~~3, 2018~~2, 2019 and ~~$41.2~~$62.4 million as of ~~October 28, 2017.~~August 4, 2018.

TJX is subject to U.S. federal income tax as well as income tax in multiple state, local and foreign jurisdictions. In the U.S., and Canada, fiscal years through 2010 ~~are no longer subject to examination. In Canada, fiscal years through 2008~~ are no longer subject to examination. In all other jurisdictions, fiscal years through 2009 are no longer subject to examination.

TJX’s accounting policy classifies interest and penalties related to income tax matters as part of income tax expense. The total accrued amount on the ~~balance sheets~~Consolidated Balance Sheets for interest and penalties was ~~$13.8~~$27.3 million as of ~~November~~August 3, ~~2018, $11.9~~2019, $23.6 million as of February ~~3, 2018~~2, 2019 and ~~$8.5~~$13.5 million as of ~~October 28, 2017.~~August 4, 2018.

Based on the outcome of tax examinations or judicial or administrative proceedings, or as a result of the expiration of statutes of limitations in specific jurisdictions, it is reasonably possible that unrecognized tax benefits for certain tax positions taken on previously filed tax returns may change materially from those presented in the ~~financial statements.~~Consolidated Financial Statements. During the next 12 months, it is reasonably possible that tax examinations of prior years’ tax returns or judicial or administrative proceedings that reflect such positions taken by TJX may be finalized. As a result, the total net amount of unrecognized tax benefits may decrease, which would reduce the provision for taxes on earnings, by a range of ~~zero~~0 to ~~$23~~$32 million.

Note K. Contingent Obligations and Contingencies

Contingent Obligations

TJX has contingent obligations on leases, for which it was a lessee or guarantor, which were assigned to third parties without TJX being released by the landlords. Over many years, TJX has assigned numerous leases that it had originally leased or guaranteed to a significant number of third parties. With the exception of leases of former businesses for which TJX has reserved, the Company has rarely had a claim with respect to assigned leases, and accordingly, the Company does not expect that such leases will have a material adverse impact on its financial condition, results of operations or cash flows. TJX does not generally have sufficient information about these leases to estimate our potential contingent obligations under them, which could be triggered in the event that one or more of the current tenants does not fulfill their obligations related to one or more of these leases.

TJX may also be contingently liable on up to ~~eight~~8 leases of former TJX businesses, for which we believe the likelihood of future liability to TJX is remote, and has contingent obligations in connection with certain assigned or sublet properties that TJX is able to estimate. We estimate that the undiscounted obligations of (i) leases of former operations not included in our reserve for former operations and (ii) properties of our former operations if the subtenants or assignees do not fulfill their obligations, are approximately ~~$40.1~~$32.0 million as of ~~November~~August 3, ~~2018.~~2019. We believe that most or all of these contingent obligations will not revert to us and, to the extent they do, will be resolved for substantially less due to mitigating factors including our expectation to further sublet.

TJX is a party to various agreements under which it may be obligated to indemnify the other party with respect to certain losses related to matters such as title to assets sold, specified environmental matters or certain income taxes. These obligations are often limited in time and amount. There are no amounts reflected in our ~~balance sheets~~Consolidated Balance Sheets with respect to these contingent obligations.

Contingencies

TJX is subject to certain legal proceedings, lawsuits, disputes and claims that arise from time to time in the ordinary course of our business. In addition, TJX is a defendant in several lawsuits filed in federal and state courts brought as putative class or collective actions on behalf of various groups of current and former salaried and hourly associates in the U.S. The lawsuits allege violations of the Fair Labor Standards Act and of state wage and hour and other labor statutes. ~~TJX is also a defendant in a putative class action on behalf of customers relating to compare at pricing.~~ The lawsuits are in various procedural stages and seek monetary damages, injunctive relief and attorneys’ fees. In connection with ongoing litigation, an immaterial amount has been accrued in the accompanying ~~financial statements.~~Consolidated Financial Statements.

Note L. Leases

TJX is committed under long-term leases related to its continuing operations for the rental of real estate and certain service contracts containing embedded leases, all of which are operating leases. Real estate leases represent virtually all of our store locations as well as some of our distribution centers and office space. Most of TJX’s leases in the U.S. and Canada are store operating leases with ten-year terms and options to extend for 1 or more five-year periods. Leases in Europe generally have an initial term of ten to fifteen years and leases in Australia generally have an initial lease term of primarily seven to ten years, some of which have options to extend. Many of the Company's leases have options to terminate prior to the lease expiration date. The exercise of both lease renewal and termination options is at our sole discretion and is not reasonably certain at lease commencement. The Company has deemed that major store renovations provide an economic disincentive to terminate the lease and when these renovations occur the Company reassesses the lease term to determine if the next lease option is reasonably certain of being exercised.

While the overwhelming majority of leases have fixed payment schedules, some leases have variable lease payments based on market indices adjusted periodically for inflation, or include rental payments based on a percentage of retail sales over contractual levels. In addition, for real estate leases, TJX is generally required to pay insurance, real estate taxes and other operating expenses including common area maintenance based on proportionate share of premises, and some of these costs are based on a market index, primarily in Canada. For leases with these variable payments based on a market index, the current lease payment amount is used in the calculation of the operating lease liability and corresponding operating lease assets included on the Consolidated Balance Sheets. The operating lease ROU assets also includes any lease payments made in advance of the assets use and is reduced by lease incentives received. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Supplemental balance sheet information related to leases as of August 3, 2019 is as follows:



	August 3, 2019
Weighted-average remaining lease term (years)	7.3
Weighted-average discount rate	3.0	%

The following table is a summary of the Company’s components of net lease cost for the thirteen weeks and twenty-six weeks ended August 3, 2019:



		Thirteen Weeks Ended		Twenty-Six Weeks Ended
In thousands	Classification	August 3, 2019		August 3, 2019
Operating lease cost	Cost of sales, including buying and occupancy costs	$	434,931	$	865,262
Variable and short term lease cost	Cost of sales, including buying and occupancy costs	286,149		567,655
Total lease cost		$	721,080	$	1,432,917

Supplemental cash flow information related to leases for the twenty-six weeks ended August 3, 2019 is as follows:



	Twenty-Six Weeks Ended
In thousands	August 3, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows paid for operating leases	$	846,211
Lease liabilities arising from obtaining right of use assets	$	993,979

The following table summarizes the maturity of lease liabilities under operating leases as of August 3, 2019:



In thousands	August 3, 2019
Fiscal year 2020 (remaining 6 months)	$	866,641
2021	1,704,141
2022	1,562,414
2023	1,399,075
2024	1,210,569
Later years	3,400,328
Total lease payments^(a)	10,143,168
Less: imputed interest^(b)	1,046,581
Total lease liabilities^(c)	$	9,096,587


(a)	Operating lease payments exclude legally binding minimum lease payments for 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.


(b)	Calculated using the incremental borrowing rate for each lease.


(c)	Total lease liabilities are broken out on the Consolidated Balance Sheets between Current portion of operating lease liabilities and Long-term operating lease liabilities.

The following table represents the gross minimum rental commitments under noncancelable leases, as disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended February 2, 2019:



In thousands	February 2, 2019
Fiscal year 2020	$	1,676,700
2021	1,603,378
2022	1,441,444
2023	1,253,420
2024	1,042,184
Later years	2,774,845
Total lease payments	$	9,791,971

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of ~~Operations.~~Operations

The Thirteen Weeks ~~(third~~(second quarter) and ~~Thirty-Nine~~Twenty-Six Weeks ~~(nine~~(six months) Ended ~~November~~August 3, ~~2018~~2019

Compared to

The Thirteen Weeks ~~(third~~(second quarter) and ~~Thirty-Nine~~Twenty-Six Weeks ~~(nine~~(six months) Ended ~~October 28, 2017~~August 4, 2018

~~Overview~~OVERVIEW

We are the leading off-price apparel and home fashions retailer in the U.S. and worldwide. We sell a rapidly changing assortment of apparel, home fashions and other 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. We operate ~~nearly 4,300~~over 4,400 stores through our four main segments: in the U.S., Marmaxx (which operates T.J. Maxx, Marshalls and tjmaxx.com) and HomeGoods (which operates HomeGoods and Homesense); 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 also operate~~In addition to our four main segments, Sierra ~~Trading Post (“STP”), an off-price retailer that includes sierratradingpost.com along with a number of~~operates sierra.com and retail stores in the U.S. ~~We currently consider all of STP as part of our e-commerce operations.~~ The results of ~~STP~~Sierra are ~~reported~~included in ~~our~~the Marmaxx segment.

~~Results of Operations~~RESULTS OF OPERATIONS

Overview of our financial performance for the quarter ended ~~November~~August 3, ~~2018:~~2019:

~~Net sales increased 12% to $9.8 billion for the third quarter of fiscal 2019 over last year’s third quarter sales of $8.8 billion. At November 3, 2018, stores in operation increased 6%~~


–	Net sales increased 5% to $9.8 billion for the second quarter of fiscal 2020 over last year’s second quarter sales of $9.3 billion. As of August 3, 2019, the number of stores in operation increased 5% and selling square footage increased 4% compared to the end of the fiscal 2019 second quarter.


–	Comp sales increased 2% for the second quarter of fiscal 2020 over an increase of 6% for the comparable period last year ended August 4, 2018. Customer traffic was the primary driver of the comp sales increase and was up at all four major segments.


–	Diluted earnings per share for the second quarter of fiscal 2020 were $0.62 versus $0.58 per share in the second quarter of fiscal 2019.


–	Our pre-tax margin (the ratio of pre-tax income to net sales) for the second quarter of fiscal 2020 was 10.4%, a 0.2 percentage point decrease compared with 10.6% in the second quarter of fiscal 2019.


–	Our cost of sales, including buying and occupancy costs, ratio for the second quarter of fiscal 2020 was 71.8%, a 0.7 percentage point increase compared with 71.1% in the second quarter of fiscal 2019.


–	Our selling, general and administrative (“SG&A”) expense ratio for the second quarter of fiscal 2020 was 17.7%, a 0.5 percentage point decrease compared with 18.2% in the second quarter of fiscal 2019.

–

Our 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 6% on a reported basis and 7% on a constant currency basis at the end of the second quarter of fiscal 2020 as compared to a 5% increase in average per store inventories on a reported basis and a 6% increase on a constant currency basis in the second quarter of fiscal 2019.


–	During the second quarter of fiscal 2020, we returned $579 million to our shareholders through share repurchases and dividends.

Impact of Brexit

The U.K’s decision to leave the European Union (“EU”), commonly referred to as “Brexit”, remains unsettled. Should the U.K. exit the EU, there are several possible outcomes each of which creates risks for TJX, especially in our European operations. Current U.K. law states that the U.K. will leave the EU on October 31, 2019 with or without a comprehensive withdrawal agreement between the U.K. and the EU, the latter commonly referred to as a "hard Brexit". Our TJX Europe management team has evaluated a range of possible outcomes, identified areas of concern and implemented strategies to help mitigate them.

Our current European operations benefit from the free movement of goods and labor between the U.K. and EU. As a result, we believe Brexit could have a negative impact on our ability to efficiently move merchandise between the U.K. and the EU. Brexit could also have a negative impact on our talent in the region, both by impacting current Associates, who are either EU citizens working in the U.K. or U.K. citizens working in the EU, and potentially impacting recruitment and retention for our European operations in the future.

If the U.K. does exit the EU, we would be subject to additional regulatory and compliance requirements for merchandise that flows between the U.K. and the EU. We have realigned our European division’s supply chain to reduce the volume of merchandise flowing between the U.K. and the EU and have established resources and systems to support this plan. In addition, we continue to communicate with our Associates about Brexit including providing relevant information about additional procedures that may be required post-Brexit. In the event of a hard Brexit, our European operations could be significantly impacted, particularly in the short term.

In addition to the ~~end of the fiscal 2018 third quarter.~~

Consolidated comp sales (defined below) increased 7% for the third quarter of fiscal 2019 over the comparable period last year ending November 4, 2017. Customer traffic was the primary driver of the comp sales increase.

~~Diluted earnings per share for the third quarter of fiscal 2019 were $0.61 versus $0.50 per share~~operational impacts mentioned above, factors including changes in consumer confidence and behavior, economic conditions, interest rates, customs duties, and foreign currency exchange rates could result in a significant financial impact to our European operations, particularly in the ~~third quarter of fiscal 2018.~~short term with a hard Brexit.

~~Our pre-tax margin (the ratio of pre-tax income~~We continue to ~~net sales) for~~monitor these developments. We believe the ~~third quarter of fiscal 2019 was 10.7%, a 0.9 percentage point decrease compared with 11.6%~~steps we have taken, and plan to take in the ~~third quarter~~event of ~~fiscal 2018.~~

~~Our cost of sales, including buying and occupancy costs, ratio for~~a hard Brexit, will help us mitigate the ~~third quarter of fiscal 2019 was 71.1%, a 0.9 percentage point increase compared with 70.2% in the third quarter of fiscal 2018.~~

Our selling, general and administrative (“SG&A”) expense ratio for the third quarter of fiscal 2019 was 17.9%, a 0.2 percentage point decrease compared with 18.1% in the third quarter of fiscal 2018.

Our consolidated average per store inventories, including inventory on hand at our distribution centers (which excludes inventory in transit) and excluding our e-commerce businesses, increased 9% on a reported basis and 10% on a constant currency basis at the end of the third quarter of fiscal 2019 as compared to a 2% decline in average per store inventories on a reported basis and a 4% decline on a constant currency basis in the third quarter of fiscal 2018.

~~During the third quarter,~~risks that we ~~returned $841 million to our shareholders through share repurchases and dividends.~~

~~The following is a discussion of our consolidated operating results, followed by a discussion of our segment operating results.~~expect could result from Brexit.

Net ~~sales:~~ ~~Consolidated net~~Sales

Net sales for the quarter ended ~~November~~August 3, ~~2018~~2019 totaled $9.8 billion, a ~~12%~~5% increase over last year’s ~~consolidated third~~second quarter net sales of ~~$8.8~~$9.3 billion. The increase reflects a 7%4% increase from ~~comp~~non-comp sales, a 6%2% increase from ~~non-comp~~comp sales, offset by a 1% negative impact from foreign currency exchange rates. This increase compares to sales growth of 6%12% in the ~~third~~second quarter of fiscal ~~2018,~~2019, which ~~reflects a 5% increase from non-comp sales and a 1% positive impact from foreign currency exchange rates.~~

~~Consolidated net sales for the nine months ended November 3, 2018 totaled $27.8 billion, a 12% increase over $24.9 billion in last year’s comparable period. The increase~~ reflects a 6% increase from comp sales, a 5% increase from non-comp sales, and a 1% positive impact from foreign currency exchange rates. ~~This compares to~~

Net sales ~~growth of 5%~~ for the ~~nine~~six months ended ~~October 28, 2017, which~~August 3, 2019 totaled $19.1 billion, a 6% increase over last year’s six-month net sales of $18.0 billion. The increase reflects a 4% increase from comp sales, a 3% increase from non-comp sales, offset by a 1% negative impact from foreign currency exchange rates. This increase compares to a sales growth of 12% for the first six months of fiscal 2019, which reflects a 5% increase from comp sales, a 5% increase from non-comp sales, and a ~~neutral~~2% positive impact from foreign currency exchange rates.

As of ~~November~~August 3, ~~2018,~~2019, our ~~consolidated~~ store count increased 6%5% and selling square footage increased 4% compared to the end of the ~~third~~second quarter last year.

~~Consolidated comp~~Comp sales for both the quarter and ~~nine~~six months ended ~~November~~August 3, ~~2018~~2019 reflect an increase in the customer traffic across all major divisions. On a consolidated basis, apparel ~~categories outperformed~~and home ~~categories~~fashions' performance was comparable for ~~both~~ the quarter and ~~nine~~apparel outperformed home fashions for the six months ended ~~November~~August 3, ~~2018.~~2019.

For both the quarter and ~~nine~~six months ended ~~November~~August 3, ~~2018,~~2019, comp sales growth in the U.S. ~~were strong throughout~~was strongest in the ~~country.~~Southeast and Southwest regions. Comp sales growth for ~~both~~TJX International was above the consolidated average, whereas TJX Canada ~~and TJX International, while solid, were~~was below the consolidated average.

We define comparable store sales, (“or comp ~~sales”),~~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. We calculate 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 define customer traffic to be the number of transactions in stores included in the comp sales calculation and average ticket to be the average retail price of the units sold. We define average transaction or average basket to be the average dollar value of transactions included in the comp sales calculation.

Sales excluded from comp sales (“non-comp sales”) consist of sales from:

~~New stores, meaning stores that have not yet met the comp sales criteria, which represents the vast majority of non-comp sales~~

~~Stores that are closed permanently or for an extended period of time~~

~~Our e-commerce businesses, meaning STP (including stores), tjmaxx.com and tkmaxx.com~~


–	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 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. ~~For~~Starting in fiscal 2020, Sierra stores that otherwise fit the ~~third quarter and nine months of fiscal 2019,~~ comp ~~sales~~store definition are ~~based on a shifted fiscal 2018 calendar so that they are calculated on a comparable week basis.~~included in comp stores in our Marmaxx segment.

Comp sales of our foreign segments are calculated by translating the current year’s comp sales of our foreign segments at the same exchange rates used in the prior year. This removes the effect of changes in currency exchange rates, which we believe is a more accurate measure of segment operating performance.

Comp sales may be referred to as “same store” sales by other retail companies. 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.

The following table sets forth certain information about our ~~consolidated~~ operating results as a percentage of net sales for the following periods:


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended				Thirteen Weeks Ended				Twenty-Six Weeks Ended
	November 3, 2018		October 28, 2017		November 3, 2018		October 28, 2017		August 3, 2019		August 4, 2018		August 3, 2019		August 4, 2018
Net sales	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%
Cost of sales, including buying and occupancy costs	71.1		70.2		71.1		70.9		71.8		71.1		71.7		71.1
Selling, general and administrative expenses	17.9		18.1		18.0		18.0		17.7		18.2		18.0		18.0
Pension settlement charge	0.4		—		0.1		—
Interest expense, net	—		0.1		—		0.1		—		—		—		—
Income before provision for income taxes*	10.7	%	11.6	%	10.8	%	11.0	%
Income before provision for income taxes^*									10.4	%	10.6	%	10.3	%	10.8	%



*	Figures may not foot due to ~~rounding~~rounding.

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. Two ways in which foreign currency exchange rates affect our reported results are as follows:

~~Translation of foreign operating results into U.S. dollars:~~ In our financial statements, we translate the operations of TJX Canada and TJX International from local currencies into U.S. dollars using currency rates in effect at different points in time. Significant changes in foreign exchange rates between comparable prior periods can result in meaningful variations in consolidated net sales, net income and earnings per share growth as well as the net sales and operating results of these segments. Currency translation generally does not affect operating margins, or affects them only slightly, as sales and expenses of the foreign operations are translated at approximately the same rates within a given period.

~~Inventory-related derivatives:~~ We routinely enter into inventory-related hedging instruments to mitigate the impact on earnings of changes in foreign currency exchange rates on merchandise purchases denominated in currencies other than the local currencies of our divisions, principally TJX Canada and TJX International. As we have not elected “hedge accounting” for these instruments, as defined by U.S. generally accepted accounting principles (“GAAP”), we record a mark-to-market gain or loss on the derivative instruments in our results of operations at the end of each reporting period. In subsequent periods, the income statement impact of the mark-to-market adjustment is effectively offset when the inventory being hedged is received and paid for. While these effects occur every reporting period, they are of much greater magnitude when there are sudden and significant changes in currency exchange rates during a short period of time. 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.

–

Translation of foreign operating results into U.S. dollars: In our Consolidated Financial Statements, we translate the operations of TJX Canada and TJX International from local currencies into U.S. dollars using currency rates in effect at different points in time. Significant changes in foreign exchange rates between comparable prior periods can result in meaningful variations in net sales, net income and earnings per share growth as well as the net sales and operating results of these segments. Currency translation generally does not affect operating margins, or affects them only slightly, as sales and expenses of the foreign operations are translated at approximately the same rates within a given period.

–

Inventory-related derivatives: We routinely enter into inventory-related hedging instruments to mitigate the impact on earnings of changes in foreign currency exchange rates on merchandise purchases denominated in currencies other than the local currencies of our divisions, principally TJX Canada and TJX International. As we have not elected “hedge accounting” for these instruments, as defined by U.S. generally accepted accounting principles (“GAAP”), we record a mark-to-market gain or loss on the derivative instruments in our results of operations at the end of each reporting period. In subsequent periods, the income statement impact of the mark-to-market adjustment is effectively offset when the inventory being hedged is received and paid for. While these effects occur every reporting period, they are of much greater magnitude when there are sudden and significant changes in currency exchange rates during a short period of time. 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.

We refer to the impact of the above two items throughout our discussion as “foreign currency.” This does not include the impact currency exchange rates can have on various transactions that are denominated in a currency other than an operating division’s local currency. When discussing the impact on our results of the effect of currency exchange rates on such transactions we refer to it as “transactional foreign exchange.”

Cost of ~~sales, including buying~~Sales, Including Buying and ~~occupancy costs:~~Occupancy Costs

Cost of sales, including buying and occupancy costs, as a percentage of net sales was 71.8% for the second quarter of fiscal 2020, an increase of 0.7 percentage points from 71.1% for the ~~third~~second quarter of fiscal 2019 and was 71.7% for the six months ended August 3, 2019, an increase of ~~0.9~~0.6 percentage points from ~~70.2% for the third quarter of fiscal 2018 and was~~ 71.1% for the ~~nine~~six months ended ~~November 3, 2018, an increase of 0.2 percentage points from 70.9% for the nine months ended~~ ~~October 28, 2017~~.August 4, 2018. The increase for ~~the quarter~~both periods was driven by ~~the unfavorable year-over-year comparison related to the Company’s inventory hedges, lower~~a decrease in merchandise margin ~~(due to~~and higher ~~freight costs), as well as an increase in~~ supply chain costs. ~~These items more than offset expense leverage on the strong comp sales growth. For the nine months ended November 3, 2018, the lower~~The decrease in merchandise margin was driven by a lower markon, in part due to transactional foreign exchange, and ~~increased supply chain costs more than offset expense leverage from comp sales growth.~~higher freight costs.

Selling, ~~general~~General and ~~administrative expenses:~~Administrative Expenses

SG&A expenses, as a percentage of net sales, were ~~17.9%~~17.7% in the ~~third~~second quarter of fiscal ~~2019,~~2020, a decrease of ~~0.2~~0.5 percentage points over last year’s ~~third~~second quarter ratio of ~~18.1%~~18.2%. ~~The improvement in this expense ratio for the third quarter was primarily due to administrative expense leverage on the strong comp sales.~~

SG&A expenses, as a percentage of net sales, were 18.0% for the ~~nine~~six months ended ~~November~~August 3, ~~2018,~~2019 and flat to last year's ~~third~~ratio for the six months ended August 4, 2018. The expense ratio for both periods reflects the favorable year-over-year comparison of the corporate IT restructuring costs and contributions to TJX's charitable foundations made in fiscal 2019 and a benefit from insurance claim settlements received in the second quarter ~~ratio. Increases due to~~of

fiscal 2020. Incremental systems and technology costs and wage increases partially offset these favorable impacts for the second quarter and fully offset them for the ~~global IT function restructuring costs were offset by expense savings and a gain related to a lease buyout in Canada.~~

~~Pension settlement charge:~~ During the third quarter of fiscal 2019, TJX annuitized and transferred current pension obligations for certain U.S. retirees and beneficiaries under the funded plan through the purchase of a group annuity contract with an insurance company. TJX transferred $207.4 million of pension plan assets to the insurance company, thereby reducing its pension benefit obligations. The transaction had no cash impact on TJX but did result in a non-cash pre-tax pension settlement charge of $36.1 million.six months ended August 3, 2019.

Interest ~~expense, net:~~Expense, net

The components of interest expense, net are summarized below:


	Thirteen Weeks Ended						Thirty-Nine Weeks Ended						Thirteen Weeks Ended						Twenty-Six Weeks Ended
In thousands	November 3, 2018			October 28, 2017			November 3, 2018			October 28, 2017			August 3, 2019			August 4, 2018			August 3, 2019			August 4, 2018
Interest expense	$	17,248		$	17,349		$	51,896		$	51,881		$	15,350		$	17,283		$	30,707		$	34,648
Capitalized interest	(752		)	(1,066		)	(3,728		)	(3,528		)	(446		)	(1,328		)	(1,165		)	(2,976		)
Interest (income)	(13,308		)	(8,302		)	(37,803		)	(20,854		)	(12,007		)	(12,926		)	(25,828		)	(24,495		)
Interest expense, net	$	3,188		$	7,981		$	10,365		$	27,499		$	2,897		$	3,029		$	3,714		$	7,177

The decrease in net interest expense for the ~~third~~second quarter and the ~~nine~~six months ended ~~November~~August 3, ~~2018,~~2019, compared to the same periods in fiscal ~~2018,~~2019, was primarily driven by a reduction in interest expense due to the elimination of build-to-suit accounting as a result of adopting the new lease accounting standard. Net interest expense for the six months ended August 3, 2019 was also favorably impacted by additional interest income, primarily due to higher return rates. For additional information, see Note A—Basis of Presentation and Summary of Significant Accounting Policies of Notes to Consolidated Financial Statements.

Provision for Income ~~taxes:~~Taxes

The effective income tax rate was ~~27.2%~~25.7% for the ~~third~~second quarter of fiscal ~~2019~~2020 compared to ~~37.1%~~25.5% for the ~~third~~second quarter of fiscal ~~2018.~~2019. The effective income tax rate was ~~25.9%~~25.5% for the ~~nine~~six months ended ~~November~~August 3, ~~2018~~2019 compared to ~~36.9%~~25.3% for the ~~nine~~six months ended ~~October 28, 2017~~.August 4, 2018. The ~~decrease~~increase in the effective income tax rate was primarily due to the ~~decrease~~reduction of excess tax benefit from share-based compensation and the expanded limitations on executive compensation, offset by a reduction in the impact of the ~~U.S. federal corporate tax rate from 35% to 21% as a result of the 2017 Tax Act and the jurisdictional mix of income.~~

Net ~~income~~Income and ~~diluted earnings per share:~~Diluted Earnings Per Share

Net income for the ~~third~~second quarter of fiscal ~~2019~~2020 was ~~$762~~$759 million, or ~~$0.61~~$0.62 per diluted share compared ~~with $641~~to $740 million, or ~~$0.50~~$0.58 per diluted share for the third quarter of fiscal 2018. The lower effective tax rate realized due to the 2017 Tax Act resulted in an estimated net benefit to diluted earnings per share of approximately $0.09 per share. The pension settlement charge had a $0.02 negative impact on earnings per share for the thirdsecond quarter of fiscal 2019. Foreign currency had a ~~$0.01 negative~~neutral impact on earnings per share for both the second quarters of fiscal 2020 and fiscal 2019.

Net income for the six months ended August 3, 2019 was $1.5 billion, or $1.19 per diluted share compared to $1.5 billion, or $1.15 per diluted share for the six months ended August 4, 2018. Foreign currency had a neutral impact on earnings per share for the ~~third quarter~~first six months of fiscal ~~2019~~2020 compared to a ~~$0.02~~$0.01 positive impact on earnings per share for the ~~third quarter of fiscal 2018.~~

~~Net income for the nine~~six months ended ~~November 3, 2018 was $2.2 billion, or $1.75 per diluted share, compared to $1.7 billion, or $1.33 per diluted share for the nine months ended~~ ~~October 28, 2017~~. The lower effective tax rate realized due to the 2017 Tax Act resulted in an estimated net benefit to diluted earnings per share of approximately $0.26 per share. The third quarter pension settlement charge had a $0.02 negative impact on earnings per share in the first nine months of fiscal 2019. Foreign currency had a $0.01 positive impact on earnings per share in the first nine months of fiscal 2019 compared to a neutral impact on earnings per share in the prior year.August 4, 2018.

Our stock repurchase programs, which reduce our weighted average diluted shares outstanding, benefited our earnings per share growth by approximately ~~two percent~~3% in the ~~third~~second quarter of fiscal ~~2019~~2020 and ~~three percent~~3% for the first ~~nine~~six months of fiscal ~~2019.~~2020 .

Segment ~~information:~~Information

We operate four main business segments. Our Marmaxx segment (T.J. Maxx, Marshalls and tjmaxx.com) and the HomeGoods segment (HomeGoods and Homesense) both operate in the United States. Our TJX Canada segment operates Winners, HomeSense and Marshalls in Canada, and our TJX International segment operates T.K. Maxx, Homesense and tkmaxx.com in Europe and T.K. Maxx in Australia. ~~We also operate~~In addition to our four main segments, Sierra ~~Trading Post (“STP”), an off-price retailer that includes sierratradingpost.com along with a number of~~operates sierra.com and retail stores in the U.S. ~~We currently consider all of STP as part of our e-commerce operations.~~ The results of ~~STP~~Sierra are included in ~~our~~the Marmaxx segment.

We evaluate the performance of our segments based on “segment profit or loss,” which we define as pre-tax income or loss before general corporate expense ~~pension settlement charge~~ and interest expense, net. “Segment profit or loss,” as we define the term, may not be comparable to similarly titled measures used by other entities. The terms “segment margin” or “segment profit margin” are used to describe segment profit or loss as a percentage of net sales. These measures of performance should not be considered an alternative to net income or cash flows from operating activities as an indicator of our performance or as a measure of liquidity.

Presented below is selected financial information related to our business segments.

U.S. ~~Segments:~~SEGMENTS

Marmaxx


	Thirteen Weeks Ended						Thirty-Nine Weeks Ended						Thirteen Weeks Ended						Twenty-Six Weeks Ended
In millions	November 3, 2018			October 28, 2017			November 3, 2018			October 28, 2017
U.S. dollars in millions													August 3, 2019			August 4, 2018			August 3, 2019			August 4, 2018
Net sales	$	5,973		$	5,298		$	17,202		$	15,550		$	6,107		$	5,848		$	11,908		$	11,229
Segment profit	$	763		$	666		$	2,344		$	2,100		$	855		$	830		$	1,651		$	1,581
Segment profit as a percentage of net sales	12.8		%	12.6		%	13.6		%	13.5		%	14.0		%	14.2		%	13.9		%	14.1		%
Increase in comp sales	9		%	(1		)%	7		%	—		%	2		%	7		%	4		%	6		%
Stores in operation at end of period
Stores in operation at end of period:
T.J. Maxx							1,247			1,219									1,260			1,236
Marshalls							1,091			1,057									1,107			1,077
Sierra Trading Post							35			26
Sierra																			39			33
Total							2,373			2,302									2,406			2,346
Selling square footage at end of period (in thousands)
Selling square footage at end of period (in thousands):
T.J. Maxx							27,396			27,034									27,577			27,247
Marshalls							25,291			24,827									25,534			25,082
Sierra Trading Post							598			451
Sierra																			654			566
Total							53,285			52,312									53,765			52,895

Net sales for Marmaxx increased ~~13%~~4% for the ~~third~~second quarter and ~~11%~~6% for the first ~~nine~~six months of fiscal ~~2019~~2020 as compared to the same periods last year. The increase in the ~~third~~second quarter represents a 9%2% increase from comp sales and a 4%2% increase from non-comp sales. The ~~nine month~~six-month increase in net sales included a 7%4% increase from comp sales and a 4%2% increase from non-comp sales. The increase in comp sales ~~for the third quarter and nine months ended November 3, 2018~~ was ~~mainly~~primarily driven by an increase in customer traffic. ~~Marmaxx sales for both periods also reflect an increase in units sold and in the average ticket.~~ Geographically, comp sales growth ~~in both~~for the quarter and six months ended August 3, 2019 was strongest in the ~~nine-month period were strong throughout~~Southeast and Southwest regions. Home fashions outperformed apparel and apparel performed at the ~~country. Apparel outperformed home fashions in both periods.~~segment average for the second quarter of fiscal 2020 and for the six months ended August 3, 2019.

Segment profit margin ~~increased~~decreased to ~~12.8%~~14.0% for the ~~third~~second quarter of fiscal ~~2019~~2020 compared to ~~12.6%~~14.2% for the same period last year, and for the ~~nine~~six months ended ~~November~~August 3, ~~2018~~2019 segment profit margin ~~increased~~decreased to ~~13.6%~~13.9% compared to ~~13.5%~~14.1% in the same period last year. The ~~increase~~decrease in segment margin for the ~~third~~second quarter and ~~nine-month~~six-month period was driven by expense leverage on the strong comp sales which more than offset increased freight costs, increased costs related to our supply chain and an increase in incentive compensation expense due to the above-plan operating performance. The increase in freight costs resulted in a decrease in merchandise margin ~~for both periods~~(primarily higher freight costs and lower markon) and an increase in supply chain costs. These reductions in segment margin were partially offset by insurance recoveries due to the settlement of business interruption claims, primarily related to the hurricane damage in Puerto Rico, and by lower incentive compensation accruals in fiscal 2020.

Our U.S. e-commerce businesses, which represent less than 3% of Marmaxx’s net sales for the second quarter and first six months of fiscal 2020 and fiscal 2019, did not have a significant impact on year-over-year segment margin comparisons for the ~~third~~second quarter and ~~nine-month period.~~six months of fiscal 2020.

HomeGoods


	Thirteen Weeks Ended						Thirty-Nine Weeks Ended							Thirteen Weeks Ended						Twenty-Six Weeks Ended
In millions	November 3, 2018			October 28, 2017			November 3, 2018				October 28, 2017
U.S. dollars in millions														August 3, 2019			August 4, 2018			August 3, 2019			August 4, 2018
Net sales	$	1,464		$	1,229		$	4,061			$	3,506		$	1,425		$	1,327		$	2,822		$	2,597
Segment profit	$	166		$	164		$	456			$	457		$	129		$	142		$	266		$	289
Segment profit as a percentage of net sales	11.3		%	13.3		%	11.2		%		13.0		%	9.0		%	10.7		%	9.4		%	11.1		%
Increase in comp sales	7		%	3		%	4		%		4		%	0		%	3		%	0		%	2		%
Stores in operation at end of period
Stores in operation at end of period:
HomeGoods							745				660									783			716
Homesense							16			—	3									23			8
Total							761				663									806			724
Selling square footage at end of period (in thousands)
Selling square footage at end of period (in thousands):
HomeGoods							13,702				12,332									14,383			13,205
Homesense							343				62									492			160
Total							14,045				12,394									14,875			13,365

Net sales for HomeGoods increased ~~19%~~7% in the ~~third~~second quarter and ~~16%~~9% in the first ~~nine~~six months of fiscal 2020 compared to the same periods last year. The increase in the second quarter represents a 7% increase from non-comp sales and flat comp sales. The six-month increase in net sales represents an increase of 9% from non-comp sales and flat comp sales. The flat comp sales for the second quarter and six months ended August 3, 2019 was the result of an increase in customer traffic offset by a decrease in the value of the average basket.

Segment profit margin decreased to 9.0% for the second quarter of fiscal 2020 compared to 10.7% for the same period last year. Segment profit margin decreased to 9.4% for the six months ended August 3, 2019 compared to 11.1% for the six months ended August 4, 2018. The decline in segment margin for the second quarter and six-month-period was primarily due to higher supply chain costs, the investment in store growth, expense deleverage on the flat comp sales and a decline in merchandise margin. Merchandise margin decreased for the second quarter and first six months of fiscal 2020 compared to the same periods last year. This decrease is a result of higher markdowns for both periods as well as increased freight costs for the first six months.

FOREIGN SEGMENTS

TJX Canada



	Thirteen Weeks Ended						Twenty-Six Weeks Ended
U.S. dollars in millions	August 3, 2019			August 4, 2018			August 3, 2019			August 4, 2018
Net sales	$	967		$	938		$	1,815		$	1,792
Segment profit	$	118		$	139		$	215		$	264
Segment profit as a percentage of net sales	12.2		%	14.8		%	11.9		%	14.7		%
Increase in comp sales	1		%	6		%	1		%	5		%
Stores in operation at end of period:
Winners							274			270
HomeSense							132			120
Marshalls							91			79
Total							497			469
Selling square footage at end of period (in thousands):
Winners							5,882			5,849
HomeSense							2,425			2,232
Marshalls							1,929			1,716
Total							10,236			9,797

Net sales for TJX Canada increased 3% during the second quarter ended August 3, 2019 and 1% for the six months ended August 3, 2019 compared to the same periods last year. The increase in the ~~third~~second quarter represents a ~~12%~~4% increase from non-comp sales, ~~and~~ a 7% increase from comp sales. The nine month increase in net sales includes an increase of 12% from non-comp sales and a 4% increase from comp sales. The increase in comp sales for the third quarter and nine months was driven by an increase in customer traffic.

Segment profit margin was 11.3% for the third quarter of fiscal 2019 compared to 13.3% for the same period last year. Segment profit margin decreased to 11.2% for the nine months ended November 3, 2018 compared to 13.0% for the nine months ended October 28, 2017. The decline in segment margin was primarily due to a reduction in merchandise margin of 1.6 percentage points for the third quarter and 0.9 percentage points for the nine months ended November 3, 2018. Merchandise margin was negatively impacted by significantly higher freight costs. Both periods were also impacted by an increase in supply chain costs which were partially offset by expense leverage on comp store sales growth.

~~Foreign Segments:~~

~~TJX Canada~~

Thirteen Weeks Ended Thirty-Nine Weeks Ended
In millions November 3,
2018 October 28,
2017 November 3,
2018 October 28,
2017
Net sales $ 1,037
$ 983
$ 2,828
$ 2,554
Segment profit $ 182
$ 206
$ 446
$ 393
Segment profit as a percentage of net sales 17.6 % 21.0 % 15.8 % 15.4 %
Increase in comp sales 5 % 4 % 5 % 4 %
Stores in operation at end of period
Winners 271
265
HomeSense 125
117
Marshalls 88
72
Total 484
454
Selling square footage at end of period (in thousands)
Winners 5,863
5,795
HomeSense 2,325
2,179
Marshalls 1,885
1,599
Total 10,073
9,573

Net sales for TJX Canada increased 5% during the third quarter ended November 3, 2018 and 11% for the nine months ended November 3, 2018 compared to the same periods last year. The increase in the third quarter represents a 5% increase in comp sales growth, and a 5% increase from non-comp sales offset by a 5% negative impact from foreign currency exchange rates. The nine-month increase in net sales includes comp sales growth of 5%, non-comp sales of 6% and neutral impact from foreign currency. The increase in comp sales for both periods was driven by an increase in customer traffic.

Segment profit margin decreased to 17.6% for the third quarter of fiscal 2019 compared to 21.0% for the same period last year. Segment profit margin increased to 15.8% for the nine months ended November 3, 2018 compared to 15.4% for the nine months ended ~~October 28, 2017~~. The decrease in the segment margin for the third quarter was primarily due to an unfavorable impact of 2.8 percentage points due to the mark-to-market impact of the inventory derivatives. Segment margin was also negatively impacted by an increase in store payroll costs due to legislated minimum wage increases. These negative factors were offset by expense leverage on the strong comp sales during the third quarter. The increase in the segment margin for the nine-months ended November 3, 2018 was primarily due to leverage on strong comp sales and the benefit of a lease buyout gain, which were partially offset by wage increases.

~~TJX International~~

Thirteen Weeks Ended Thirty-Nine Weeks Ended
In millions November 3,
2018 October 28,
2017 November 3,
2018 October 28,
2017
Net sales $ 1,352
$ 1,252
$ 3,754
$ 3,293
Segment profit $ 102
$ 87
$ 192
$ 133
Segment profit as a percentage of net sales 7.6 % 7.0 % 5.1 % 4.0 %
Increase in comp sales 3 % 1 % 3 % 1 %
Stores in operation at end of period
T.K. Maxx 566
540
Homesense 68
55
T.K. Maxx Australia 44
38
Total 678
633
Selling square footage at end of period (in thousands)
T.K. Maxx 11,675
11,379
Homesense 1,037
883
T.K. Maxx Australia 914
714
Total 13,626
12,976

Net sales for TJX International increased 8% for the third quarter and 14% for the nine months ended November 3, 2018 compared to the same periods last year. The increase in the third quarter represents a 7% increase from non-comp sales and a 3%1% increase in comp sales growth, offset by a 2% negative impact from foreign currency exchange rates. The ~~nine-month~~six month increase in net sales ~~includes~~represents a 7%3% increase from non-comp sales, comp sales growth of 1% and currency translation which negatively impacted sales growth by 3%. The increase in comp sales for both periods was driven primarily by an increase in customer traffic partially offset by a decrease in the value of the average basket.

Segment profit margin decreased to 12.2% for the second quarter of fiscal 2020 compared to 14.8% for the same period last year. This decrease in the segment margin primarily reflects a 1.5 percentage point decline in merchandise margin, the unfavorable impact on the mark-to-market of inventory derivatives and the expense deleverage on the 1% comp sales growth. The decrease in merchandise margin was primarily driven by transactional foreign exchange as the change in currency exchange rates increased TJX Canada's cost of merchandise purchased in U.S. dollars as compared to the same period last year and higher markdowns.

Segment profit margin decreased to 11.9% for the six months ended August 3, 2019 compared to 14.7% for the six months ended August 4, 2018. This decrease in the segment margin was primarily driven by a 1.3 percentage point decrease in merchandise margin, due to the same factors impacting the quarter as described above. In addition, segment margin reflects an unfavorable year-over-year comparison related to a lease buyout gain in the first quarter of fiscal 2019 and expense deleverage on the 1% comp sales growth.

TJX International



	Thirteen Weeks Ended						Twenty-Six Weeks Ended
U.S. dollars in millions	August 3, 2019			August 4, 2018			August 3, 2019			August 4, 2018
Net sales	$	1,283		$	1,218		$	2,514		$	2,403
Segment profit	$	50		$	49		$	79		$	90
Segment profit as a percentage of net sales	3.9		%	4.0		%	3.1		%	3.7		%
Increase in comp sales	6		%	4		%	7		%	3		%
Stores in operation at end of period:
T.K. Maxx							580			552
Homesense							72			61
T.K. Maxx Australia							51			42
Total							703			655
Selling square footage at end of period (in thousands):
T.K. Maxx							11,849			11,560
Homesense							1,074			958
T.K. Maxx Australia							937			780
Total							13,860			13,298

Net sales for TJX International increased 5% for the second quarter and 5% for the six months ended August 3, 2019 compared to the same periods last year. The increase in the second quarter represents a 6% increase in comp sales growth, a 4% ~~positive~~increase from non-comp sales, offset by a 5% negative impact from foreign currency exchange ~~rates, and~~rates. The increase in the six-month period represents a 3%7% increase in comp ~~sales.~~sales growth, a 4% increase from non-comp sales, offset by a 6% negative impact from foreign currency exchange rates. The increase in comp sales for both periods was driven by an increase in customer traffic. E-commerce sales represent less than 3% of TJX International’s net sales for the second quarter and first six months of fiscal 2020 and fiscal 2019.

Segment profit margin ~~increased~~decreased to ~~7.6%~~3.9% for the ~~third~~second quarter of fiscal ~~2019~~2020 compared to ~~7.0%~~4.0% for the same period last year. ~~Segment profit margin increased to 5.1% for the nine months ended November 3, 2018 compared to 4.0% for the nine months ended~~ ~~October 28, 2017. The increase~~This decrease in segment margin for the third quarter of fiscal 2019 was driven by cost efficiencies, especially in favorable negotiated lease terms, an increase in merchandise margin and a reserve adjustment due to the favorable outcome of a wage audit. These margin improvements were partially offset byreflects the unfavorable impact of ~~1.3 percentage points~~transactional foreign exchange which more than offset the expense leverage on the strong comp sales.

Segment profit margin decreased to 3.1% for the ~~third quarter due~~six months ended August 3, 2019 compared to 3.7% for the ~~year-over year mark-to-market impact of the inventory derivatives. The increase~~six months ended August 4, 2018. This decrease in ~~the~~ segment margin ~~for~~was driven by the ~~nine-months ended November 3, 2018 was primarily due to the favorable year over year impact of the~~year-over-year mark-to-market impact of the inventory derivatives ~~cost efficiencies~~ and the ~~favorable outcome~~unfavorable impact of ~~a wage audit.~~transactional foreign exchange which collectively more than offset the expense leverage on the strong comp sales growth.

~~General corporate expense~~

GENERAL CORPORATE EXPENSE


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended				Thirteen Weeks Ended				Twenty-Six Weeks Ended
In millions	November 3, 2018		October 28, 2017		November 3, 2018		October 28, 2017		August 3, 2019		August 4, 2018		August 3, 2019		August 4, 2018
General corporate expense	$	128	$	95	$	396	$	311	$	129	$	164	$	250	$	268



Delaware			04-2207613
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

770 Cochituate Road	Framingham,	Massachusetts	01701
(Address of principal executive offices)			(Zip Code)



Title of Each Class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $1.00 per share	TJX	New York Stock Exchange



Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

Emerging growth company	☐



	Thirteen Weeks Ended
	November 3, 2018			October 28, 2017
Net income	$	762,253		$	641,436
Additions to other comprehensive income:
Foreign currency translation adjustments, net of related tax provision of $143 in fiscal 2019 and benefit of $18,110 in fiscal 2018	(18,055		)	(46,029		)
Recognition of net gains/losses on benefit obligations, net of related tax benefit of $1,867 in fiscal year 2019 (See Note H)	(5,128		)	—
Reclassifications from other comprehensive income to net income:
Pension settlement charge, net of related tax provision of $9,641 in fiscal 2019	26,481			—
Amortization of prior service cost and deferred gains, net of related tax provisions of $1,109 in fiscal 2019 and $2,414 in fiscal 2018	3,047			3,669
Amortization of loss on cash flow hedge, net of related tax provisions of $76 in fiscal 2019 and $112 in fiscal 2018	208			171
Other comprehensive income (loss), net of tax	6,553			(42,189		)
Total comprehensive income	$	768,806		$	599,247



	Thirteen Weeks Ended
	August 3, 2019			August 4, 2018
Net income	$	758,962		$	739,626
Additions to other comprehensive loss:
Foreign currency translation adjustments, net of related tax provision of $1,681 in fiscal 2020 and benefit of $12,519 in fiscal 2019	(83,743		)	(59,733		)
Gain on net investment hedges, net of related tax provision of $4,912 in fiscal 2019	—			13,495
Reclassifications from other comprehensive loss to net income:
Amortization of prior service cost and deferred gains/losses, net of related tax provisions of $1,453 in fiscal 2020 and $773 in fiscal 2019	3,992			3,162
Amortization of loss on cash flow hedge, net of related tax provisions of $76 in fiscal 2020 and $76 in fiscal 2019	208			208
Other comprehensive loss, net of tax	(79,543		)	(42,868		)
Total comprehensive income	$	679,419		$	696,758



☒	Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934



☐	Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


	November 3, 2018			February 3, 2018			October 28, 2017			August 3, 2019			February 2, 2019			August 4, 2018
ASSETS
Current assets:
Cash and cash equivalents	$	2,711,767		$	2,758,477		$	2,364,244		$	2,186,382		$	3,030,229		$	2,872,717
Short-term investments	—			506,165			511,618
Accounts receivable, net	419,790			327,166			345,866			377,057			346,298			356,180
Merchandise inventories	5,543,413			4,187,243			4,725,850			5,087,046			4,579,033			4,498,523
Prepaid expenses and other current assets	544,427			706,676			422,719			618,119			513,662			712,552
Federal, state, and foreign income taxes recoverable	97,616			—			19,737
Total current assets	9,317,013			8,485,727			8,390,034			8,268,604			8,469,222			8,439,972
Net property at cost	5,165,875			5,006,053			4,858,284			5,041,878			5,255,208			5,100,454
Non-current deferred income taxes, net										5,642			6,467			9
Operating lease right of use assets										8,944,302			—			—
Goodwill	97,348			100,069			196,365			95,938			97,552			98,114
Other assets	445,006			466,166			433,012			498,615			497,580			472,879
TOTAL ASSETS	$	15,025,242		$	14,058,015		$	13,877,695		$	22,854,979		$	14,326,029		$	14,111,428
LIABILITIES
Current liabilities:
Accounts payable	$	3,340,596		$	2,488,373		$	2,986,374		$	2,607,651		$	2,644,143		$	2,683,285
Accrued expenses and other current liabilities	2,594,561			2,522,961			2,361,422			2,601,851			2,733,076			2,414,186
Current portion of operating lease liabilities										1,353,721			—			—
Federal, state and foreign income taxes payable	78,668			114,203			120,185			37,518			154,155			40,346
Total current liabilities	6,013,825			5,125,537			5,467,981			6,600,741			5,531,374			5,137,817
Other long-term liabilities	1,284,911			1,320,505			1,159,975			776,654			1,354,242			1,289,353
Non-current deferred income taxes, net	236,769			233,057			374,276			196,985			158,191			225,073
Long-term operating lease liabilities										7,742,866			—			—
Long-term debt	2,232,864			2,230,607			2,229,855			2,235,121			2,233,616			2,232,112
Commitments and contingencies (See Note K)
SHAREHOLDERS’ EQUITY
Preferred stock, authorized 5,000,000 shares, par value $1, no shares issued	—			—			—			—			—			—
Common stock, authorized 1,800,000,000 shares, par value $1, issued and outstanding 1,233,145,248; 1,256,018,044 and 1,264,605,010 respectively	1,233,145			1,256,018			1,264,605
Common stock, authorized 1,800,000,000 shares, par value $1, issued and outstanding 1,208,932,667; 1,217,182,508 and 1,241,533,412 respectively										1,208,933			1,217,183			1,241,533
Additional paid-in capital	—			—			—			—			—			—
Accumulated other comprehensive (loss)	(591,847		)	(441,859		)	(602,919		)
Accumulated other comprehensive loss										(712,825		)	(630,321		)	(598,398		)
Retained earnings	4,615,575			4,334,150			3,983,922			4,806,504			4,461,744			4,583,938
Total shareholders’ equity	5,256,873			5,148,309			4,645,608			5,302,612			5,048,606			5,227,073
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	15,025,242		$	14,058,015		$	13,877,695		$	22,854,979		$	14,326,029		$	14,111,428



	Thirteen Weeks Ended
	Common Stock
	Shares		Par Value $1			Additional Paid-In Capital			Accumulated Other Comprehensive Loss			Retained Earnings			Total
Balance, May 4, 2019	1,212,668		$	1,212,668		$	—		$	(633,282	)	$	4,552,509		$	5,131,895
Net income	—		—			—			—			758,962			758,962
Other comprehensive loss, net of tax	—		—			—			(79,543		)	—			(79,543		)
Cash dividends declared on common stock	—		—			—			—			(278,624		)	(278,624		)
Recognition of share-based compensation	—		—			29,668			—			—			29,668
Issuance of common stock under Stock Incentive Plan, net of shares used to pay tax withholdings	1,952		1,952			40,759			—			—			42,711
Common stock repurchased and retired	(5,687	)	(5,687		)	(70,427		)	—			(226,343		)	(302,457		)
Balance, August 3, 2019	1,208,933		$	1,208,933		$	—		$	(712,825	)	$	4,806,504		$	5,302,612



	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
In thousands, except per share data	November 3, 2018		October 28, 2017		November 3, 2018		October 28, 2017
Basic earnings per share
Net income	$	762,253	$	641,436	$	2,218,260	$	1,730,672
Weighted average common shares outstanding for basic EPS	1,236,842		1,268,044		1,245,639		1,278,383
Basic earnings per share	$	0.62	$	0.51	$	1.78	$	1.35
Diluted earnings per share
Net income	$	762,253	$	641,436	$	2,218,260	$	1,730,672
Shares for basic and diluted earnings per share calculations:
Weighted average common shares outstanding for basic EPS	1,236,842		1,268,044		1,245,639		1,278,383
Assumed exercise/vesting of:
Stock options and awards	20,720		17,718		18,461		18,961
Weighted average common shares outstanding for diluted EPS	1,257,562		1,285,762		1,264,100		1,297,344
Diluted earnings per share	$	0.61	$	0.50	$	1.75	$	1.33
Cash dividends declared per share	$	0.195	$	0.156	$	0.585	$	0.469



	Total Number of Shares Repurchased (1)	Average Price Paid Per Share (2)		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(1)	Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs(3)
August 5, 2018 through September 1, 2018	5,911,984	$	50.74	5,911,984	$	2,835,784,975
September 2, 2018 through October 6, 2018	1,982,868	$	55.48	1,982,868	$	2,725,785,078
October 7, 2018 through November 3, 2018	3,476,242	$	54.66	3,476,242	$	2,535,789,638
Total:	11,371,094			11,371,094



	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)
May 5, 2019 through June 1, 2019	1,715,617	$	52.46	1,715,617	$	2,740,790,664
June 2, 2019 through July 6, 2019	2,207,115	$	52.10	2,207,115	$	2,625,790,701
July 7, 2019 through August 3, 2019	1,721,389	$	55.19	1,721,389	$	2,530,790,717
Total	5,644,121			5,644,121


~~(1)~~(a)	Consists of shares repurchased under publicly announced stock repurchase programs.


~~(2)~~(b)	Includes commissions for the shares repurchased under stock repurchase programs.



~~3.1~~		The Fourth Restated Certificate of Incorporation is incorporated herein by reference to Exhibit 99.1 to the Form 8-A/A filed September 9, 1999. The Certificate of Amendment of Fourth Restated Certificate of Incorporation is incorporated by reference to Exhibit 3.1 to the Form 8-K filed October 22, 2018.

~~10.1~~Exhibit No.		~~The Stock Incentive Plan Rules for U.K. Employees, effective as of September 17, 2018.~~

~~10.2~~		~~The Executive Severance Plan effective September 27, 2018.~~

~~10.3~~		~~The Executive Severance Plan Participation Agreement dated September 27, 2018 between Carol Meyrowitz and TJX.~~

~~10.4~~		~~The Executive Severance Plan Participation Agreement dated September 27, 2018 between Ernie Herrman and TJX.~~

~~10.5~~		~~The Executive Severance Plan Participation Agreement dated September 27, 2018 between Scott Goldenberg and TJX.~~

~~10.6~~		~~The Executive Severance Plan Participation Agreement dated September 27, 2018 between Richard Sherr and TJX.~~

~~10.7~~		~~The Executive Severance Plan Participation Agreement dated September 27, 2018 between Kenneth Canestrari and TJX.~~

~~10.8~~		~~The Executive Severance Plan Participation Agreement dated September 27, 2018 between Douglas Mizzi and TJX.~~
		Description
31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of ~~2002.~~2002, filed herewith

31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of ~~2002.~~2002, filed herewith

32.1		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of ~~2002.~~2002, filed herewith

32.2		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of ~~2002.~~2002, filed herewith

101		The following materials from The TJX Companies, Inc.’s Quarterly Report on Form 10-Q for the quarter ended ~~November~~August 3, ~~2018,~~2019, formatted in Inline XBRL (Extensible Business Reporting Language): (i) the Consolidated Statements of Income, (ii) the Consolidated Statements of Comprehensive Income, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statements of Cash Flows, (v) the Consolidated Statement of Shareholders’ Equity, and (vi) Notes to Consolidated Financial Statements.
104	The cover page from The TJX Companies, Inc.’s Quarterly Report on Form 10-Q for the quarter ended August 3, 2019, formatted in Inline XBRL (included in Exhibit 101)




				THE TJX COMPANIES, INC.
				(Registrant)

Date: ~~December 4, 2018~~August 30, 2019
				/s/ Scott Goldenberg
				Scott Goldenberg, Chief Financial Officer
				(Principal Financial and Accounting Officer)