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Financial Instruments
 9 Months Ended
Nov. 02, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Financial Instruments 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 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 2019, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for fiscal 2020, and during the first nine months of fiscal 2020, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for the first nine months of fiscal 2021. The hedge agreements outstanding at November 2, 2019 relate to approximately 48% of TJX’s estimated notional diesel requirements for the remainder of fiscal 2020 and approximately 49% of TJX’s estimated notional diesel requirements for the first nine months of fiscal 2021. These diesel fuel hedge agreements will settle throughout the remainder of fiscal 2020 and throughout the first ten months of fiscal 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 currencies other than their respective functional currencies. These contracts typically have a term of twelve months or less. The contracts outstanding at November 2, 2019 cover a portion of such actual and anticipated merchandise purchases throughout the remainder 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' duration to mitigate the exposure. During the first six months of fiscal 2020, TJX had 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 had elected not to apply hedge accounting to these contracts. During the third quarter of fiscal 2020 TJX discontinued these hedges.
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' 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 $18 million on the declared dividends.
The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at November 2, 2019:
In thousandsPayReceiveBlended
Contract
Rate		Balance Sheet
Location		Current
Asset
U.S.$		Current
(Liability)
U.S.$		Net Fair
Value in
U.S.$ at
November 2, 2019
Fair value hedges:
Intercompany balances, primarily debt and related interest:
zł64,000  £13,144  0.2054  Prepaid Exp$246  $—  $246  
€46,450  £41,712  0.8980  Prepaid Exp1,919  —  1,919  
A$50,000  U.S.$34,370  0.6874  (Accrued Exp)—  (303) (303) 
U.S.$72,020  £55,000  0.7637  (Accrued Exp)—  (757) (757) 
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)—  (3,878) (3,878) 
Intercompany billings in TJX International, primarily merchandise related:
€86,800  £76,837  0.8852  Prepaid Exp2,411  —  2,411  
Merchandise purchase commitments:
C$642,859  U.S.$487,300  0.7580  Prepaid Exp / (Accrued Exp)808  (2,960) (2,152) 
C$31,863  €21,600  0.6779  Prepaid Exp / (Accrued Exp)36  (111) (75) 
£308,166  U.S.$386,700  1.2548  Prepaid Exp / (Accrued Exp)373  (14,122) (13,749) 
A$42,054  U.S.$28,767  0.6840  Prepaid Exp / (Accrued Exp)46  (414) (368) 
zł369,290  £76,343  0.2067  Prepaid Exp / (Accrued Exp)2,192  (148) 2,044  
U.S.$2,254  £1,761  0.7813  Prepaid Exp23  —  23  
U.S.$69,558  €61,875  0.8895  Prepaid Exp / (Accrued Exp)304  (614) (310) 
Total fair value of derivative financial instruments$8,358  $(23,307) $(14,949) 
The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at February 2, 2019:
In thousandsPayReceiveBlended
Contract
Rate		Balance Sheet
Location		Current
Asset
U.S.$		Current
(Liability)
U.S.$		Net Fair
Value in
U.S.$ at
February 2,
2019
Fair value hedges:
Intercompany balances, primarily debt and related interest:
zł59,000  £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 Exp1,037  —  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 Exp1,300  —  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  
zł280,167  £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) $(3,065) 
The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at November 3, 2018:
In thousandsPayReceiveBlended
Contract
Rate		Balance Sheet
Location		Current
Asset
U.S.$		Current
(Liability)
U.S.$		Net Fair 
Value in 
U.S.$ at 
November 3, 2018
Fair value hedges:
Intercompany balances, primarily debt and related interest:
zł62,000  £12,983  0.2094  Prepaid Exp$475  $—  $475  
€48,950  £43,612  0.8909  Prepaid Exp626  —  626  
U.S.$77,079  £55,000  0.7136  (Accrued Exp)—  (5,545) (5,545) 
A$30,000  U.S.$21,207  0.7069  (Accrued Exp)—  (429) (429) 
Economic hedges for which hedge accounting was not elected:
Diesel fuel contracts
Fixed on
1.3M – 3.0M
gal per month
Float on
1.3M – 3.0M
gal per month
N/APrepaid Exp4,965  —  4,965  
Intercompany billings in TJX International, primarily merchandise related:
€82,000  £71,853  0.8763  (Accrued Exp)—  (231) (231) 
Merchandise purchase commitments:
C$582,670  U.S.$447,800  0.7685  Prepaid Exp / (Accrued Exp)3,216  (543) 2,673  
C$29,614  €19,500  0.6585  Prepaid Exp / (Accrued Exp)4  (342) (338) 
£271,690  U.S.$369,500  1.3600  Prepaid Exp / (Accrued Exp)15,585  (132) 15,453  
U.S.$2,692  £2,067  0.7678  Prepaid Exp / (Accrued Exp)15  (28) (13) 
A$45,132  U.S.$32,962  0.7303  Prepaid Exp / (Accrued Exp)441  (21) 420  
zł289,208  £59,158  0.2046  Prepaid Exp / (Accrued Exp)744  (373) 371  
U.S.$67,459  €57,065  0.8459  (Accrued Exp)—  (2,235) (2,235) 
Total fair value of derivative financial instruments$26,071  $(9,879) $16,192  
Presented below is the impact of derivative financial instruments on the Consolidated Statements of 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 EndedThirty-Nine Weeks Ended
In thousandsNovember 2, 2019November 3, 2018November 2, 2019November 3, 2018
Fair value hedges:
Intercompany balances, primarily debt and related interestSelling, general and administrative expenses$7,238  $672  $526  $(3,538) 
Economic hedges for which hedge accounting was not elected:
Intercompany receivableSelling, general and administrative expenses—  —  3,257  18,823  
Diesel fuel contractsCost of sales, including buying and occupancy costs529  1,572  (2,103) 7,530  
Intercompany billings in TJX International, primarily merchandise relatedCost of sales, including buying and occupancy costs5,144  1,718  944  1,024  
International lease liabilitiesCost of sales, including buying and occupancy costs301  —  (1,113) —  
Merchandise purchase commitmentsCost of sales, including buying and occupancy costs(18,622) 8,463  8,536  61,091  
Gain / (loss) recognized in income$(5,410) $12,425  $10,047  $84,930