Company: TJX
Filing Date: 2025-04-02
Form Type: 10-K
Source: 0000109198-25-000010
Chunk: 97

Company: TJX COMPANIES INC /DE/
Filing Date: 2025-04-02
Form: 10-K
Item: Item 7
Chunk 97
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 compared to 70.0% of net sales for fiscal 2024. 

The decrease in the cost of sales ratio, including buying and occupancy costs, was attributable to higher merchandise margin due to higher markon, lower freight costs and lower inventory shrink expense, partially offset by higher supply chain costs.

Selling, General and Administrative Expenses

SG&A expenses, as a percentage of net sales, was 19.4% for fiscal 2025, an increase of 0.1 percentage points compared to 19.3% for fiscal 2024.

The increase in SG&A ratio for fiscal 2025 was due to incremental store wage and payroll costs, partially offset by a favorable year-over-year impact from a prior year reserve related to a German COVID program receivable and the year-over-year benefit from closing HomeGoods’ e-commerce business last year.

Interest (Income) Expense, net

The components of interest (income) expense, net for the last two fiscal years are summarized below:  Fiscal Year EndedIn millionsFebruary 1,2025February 3,2024(53 weeks)Interest expense$78 $82 Capitalized interest(2)(3)Interest (income)(257)(249)Interest (income) expense, net$(181)$(170)

Interest (income) expense, net increased for fiscal 2025 compared to fiscal 2024 due to an increase in interest income driven by a higher average cash balance.

Provision for Income Taxes

In 2021, the Organization for Economic Co-operation and Development announced an Inclusive Framework on Base Erosion and Profit Shifting including Pillar Two Model Rules defining the global minimum tax, which calls for the taxation of large multinational corporations at a minimum rate of 15%. Subsequently multiple sets of administrative guidance have been issued. Many non-US tax jurisdictions have either recently enacted legislation to adopt certain components of the Pillar Two Model Rules beginning in 2024 with the adoption of additional components in later years or announced their plans to enact legislation in future years. These rules did not have a material impact on our financial statements for fiscal 2025 and did not materially increase our global tax costs on our fiscal 2025 financial statements. There remains uncertainty as to the final Pillar Two model rules. We are continuing to evaluate the impacts of enacted legislation and pending legislation to enact Pillar Two Model Rules in the non-US tax jurisdictions in which we operate.

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The effective income tax rate was 25.0% for fiscal 202