Analysis of Debt
Total Debt (Carrying Amount)
TJX Cos. Inc., balance sheet: debt
US$ in millions
Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).
The analysis of the debt data over the specified periods reveals several noteworthy trends and fluctuations in the company's debt structure.
- Current Portion of Long-Term Debt
- The data exhibits intermittent reporting for this category, with values recorded only in certain years. Specifically, a current portion of $750 million is indicated in early 2021, which then decreases to $500 million by early 2023. No data is available for other periods, suggesting either no current portion of long-term debt in those years or unreported amounts. This variability indicates a non-steady pattern in the short-term maturities of long-term debt within the given timeframe.
- Long-Term Debt, Excluding Current Portion
- This category shows a significant increase from $2,237 million in early 2020 to a peak of $5,333 million by early 2021. However, this is followed by a marked decrease in subsequent years, declining to $3,355 million in early 2022 and further to approximately $2,859-$2,866 million in the latest reported years (2023-2025). The trend suggests a substantial debt acquisition or reclassification around 2021, succeeded by progressive repayments or restructuring to reduce long-term liabilities over the following years.
- Total Long-Term Debt, Inclusive of Current Maturities (Carrying Amount)
- Overall long-term debt inclusive of current maturities aligns closely with the sum of the current portion and the long-term debt excluding current portion where data is available. The total debt rises sharply from $2,237 million in early 2020 to $6,083 million in early 2021, confirming the significant increase seen in long-term liabilities. In later periods, the total long-term debt decreases and stabilizes around $2,862-$2,866 million between 2023 and 2025, reflecting a deleveraging phase consistent with earlier observations.
In summary, the data indicates an episodic increase in the company's long-term debt around 2021, followed by a steady decline and stabilization in subsequent years. The variability in the current portion of long-term debt points to fluctuations in short-term financing or debt maturities. The overall pattern suggests strategic management of debt levels, with emphasis on reduction and stabilization after a significant borrowing event or reclassification in 2021.
Total Debt (Fair Value)
| Feb 1, 2025 | |
|---|---|
| Selected Financial Data (US$ in millions) | |
| Current maturities of long-term debt | —) |
| Long-term debt, exclusive of current maturities | 2,634) |
| Total long-term debt, inclusive of current maturities (fair value) | 2,634) |
| Financial Ratio | |
| Debt, fair value to carrying amount ratio | 0.92 |
Based on: 10-K (reporting date: 2025-02-01).
Weighted-average Interest Rate on Debt
Weighted-average effective interest rate on debt: 2.56%
| Interest rate | Debt amount1 | Interest rate × Debt amount | Weighted-average interest rate2 |
|---|---|---|---|
| 2.32% | 998) | 23) | |
| 1.18% | 500) | 6) | |
| 3.89% | 496) | 19) | |
| 1.61% | 500) | 8) | |
| 4.52% | 383) | 17) | |
| Total | 2,877) | 74) | |
| 2.56% | |||
Based on: 10-K (reporting date: 2025-02-01).
1 US$ in millions
2 Weighted-average interest rate = 100 × 74 ÷ 2,877 = 2.56%
Interest Costs Incurred
TJX Cos. Inc., interest costs incurred
US$ in millions
Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).
- Interest Expense, Excluding Capitalized Interest
- The interest expense, excluding capitalized interest, shows significant fluctuation over the observed periods. It started at $59 million in February 2020 and experienced a sharp increase to $194 million in January 2021, indicating a substantial rise in interest costs during that year. Following this peak, there was a consistent downward trend: the expense decreased to $120 million in 2022, then further declined to $84 million in 2023, and continued tapering off to $79 million in 2024 and $76 million in 2025. This pattern suggests a reduction in borrowings or improved interest rates after the spike in 2021.
- Capitalized Interest
- Capitalized interest values remained relatively low and variable throughout the periods. Beginning at $2 million in 2020, it increased moderately to $5 million in 2021, followed by a slight reduction to $4 million in 2022. A peak of $7 million was recorded in 2023, after which it dropped again to $3 million in 2024 and $2 million in 2025. This fluctuation implies some variability in the amount of interest being capitalized, possibly linked to the timing or scale of capital projects.
- Total Interest Expense
- The total interest expense, which is the sum of the two components above, mirrored the trend of interest expense excluding capitalized interest closely. It started at $61 million in 2020, surged to $199 million in 2021, and then steadily declined over the next four years, reaching $78 million in 2025. The modest differences between the total interest expense and the expense excluding capitalized interest underscore the relatively minor role of capitalized interest in the company's total interest costs.
- Summary of Trends and Insights
- Overall, the data exhibit a pronounced peak in total interest costs and interest expense excluding capitalized interest in early 2021, followed by a more than 60% reduction over the subsequent four years. Capitalized interest shows less consistency, suggesting variable capitalization strategies. The significant decrease from 2021 onward may reflect refinancing, repayment of debt, or changes in interest rates. The relatively low levels of capitalized interest compared to total interest suggest that most interest expense is recognized as an operational cost rather than being deferred on the balance sheet.
Adjusted Interest Coverage Ratio
Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).
2025 Calculations
1 Interest coverage ratio (without capitalized interest) = EBIT ÷ Interest expense, excluding capitalized interest
= 6,559 ÷ 76 = 86.30
2 Adjusted interest coverage ratio (with capitalized interest) = EBIT ÷ Interest expense
= 6,559 ÷ 78 = 84.09
The interest coverage ratios for the analyzed periods demonstrate a fluctuating trend with notable volatility. Both the standard interest coverage ratio and the adjusted interest coverage ratio (which includes capitalized interest) exhibit similar movement patterns over the six fiscal years observed.
- Interest Coverage Ratio (without capitalized interest)
- The ratio starts at a high level of 75.57 in the fiscal year ending February 1, 2020. It then sharply declines to 1.46 in the following year, indicating a significant drop in the company's ability to cover interest expenses from operating earnings during that period. Subsequently, the ratio rebounds to 37.8 by January 29, 2022, and continues to improve in the next years, increasing to 56.19, then 76.53, and reaching 86.3 by February 1, 2025. This pattern suggests a recovery and strengthening of the company’s interest expense coverage capability after a pronounced dip.
- Adjusted Interest Coverage Ratio (with capitalized interest)
- This ratio mirrors the trend of the non-adjusted interest coverage ratio. It begins at 72.72 in 2020, significantly decreases to 1.42 in 2021, indicating a similar constraint on interest coverage when capitalized interest is included. Following this low point, it recovers steadily to 36.67, then rises progressively to 51.87, 73.73, and finally 84.09 by 2025. The close alignment with the unadjusted ratio suggests that capitalization of interest does not dramatically alter the overall assessment of the company's ability to meet interest obligations.
Overall, the data reflects a period of financial strain around the 2021 fiscal year, followed by consistent improvement over subsequent years. The company’s capacity to cover interest payments improved markedly, reaching and surpassing pre-2021 levels by the 2025 fiscal year. This recovery implies effective management of earnings relative to interest expenses and possible operational or financial restructuring that enhanced liquidity or profitability.