Ernie L. Herrman - The TJX Cos., Inc. Jeff Botte - The TJX Cos., Inc. Scott Goldenberg - The TJX Cos., Inc.

Matthew Robert Boss - JPMorgan Securities LLC Lindsay Drucker Mann - Goldman Sachs & Co. Omar Saad - Evercore ISI Michael Binetti - UBS Securities LLC Lorraine Maikis Hutchinson - Bank of America Merrill Lynch Oliver Chen - Cowen & Co. LLC Dana Lauren Telsey - Telsey Advisory Group LLC

Ladies and gentlemen, thank you for standing by. Welcome to The TJX Companies' Fourth Quarter Fiscal 2017 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. And as a reminder, this conference call is being recorded. If you have any objections, please disconnect at this time. I would like to turn the call over to your host, Mr. Ernie Herrman, Chief Executive Officer and President of The TJX Companies, Incorporated. Please go ahead, sir. Ernie L. Herrman - The TJX Cos., Inc.: Thanks, Franco. Before we begin, I'd like to congratulate Deb McConnell on the recent birth of her son. As Deb is on maternity leave, Jeff Botte will start us off with some opening comments. Jeff Botte - The TJX Cos., Inc.: Thank you, Ernie, and good morning. The forward-looking statements we make today about the company's results and plans are subject to risk and uncertainties that could cause the actual results and the implementation of the company's plans to vary materially. These risks are discussed in the company's SEC filings including, without limitation, the Form 10-K filed March 29, 2016. Further, these comments and the Q&A that follows are copyrighted today by The TJX Companies, Inc. Any recording, retransmission, reproduction or other use of the same for profit or otherwise without prior consent of TJX is prohibited and a violation of United States copyright and other laws. Additionally, while we have approved the publishing of a transcript of this call by a third-party, we take no responsibility for inaccuracies that may appear in that transcript. Please note that the financial results and expectations we discuss today are on a continuing-operations basis. Also, we have detailed the impact of foreign exchange on our consolidated results and our international divisions in today's press release in the Investor section of our website, TJX.com. Reconciliations of the non-GAAP measures we discuss today to GAAP measures are posted on our website, TJX.com, in the Investor section. Thank you and now I'll turn it back over to Ernie. Ernie L. Herrman - The TJX Cos., Inc.: Good morning. Joining me and Jeff on the call is Scott Goldenberg. I'd like to begin by saying that 2016 was another terrific year for TJX. Net sales increased 7% over last year's 6% increase. Consolidated comp store sales were up a strong 5%, above our plan and over a 5% increase last year. Adjusted earnings per share were $3.53, also above our expectations. We are convinced that we are gaining market share around the globe, as customer traffic was the primary driver of comp sales at every major division for the year. Clearly, our differentiated mix of great fashions and brands at amazing values continues to resonate with consumers. We were also very pleased with the excellent performance across our apparel, accessories and home businesses in 2016. We celebrated 40 years as a company in 2016. We are proud of our long, consistent history of sales and profit growth and successful expansion of our off-price concept across the U.S. and around the world. Over four decades, we have had an annual comparable store sales decline in only one year. Further, 2016 marked our 21st consecutive year of comp sales increases. We believe our long track record of consistency and growth is a testament to the people in our organization and our ability to leverage the power of our flexible business model through many types of economic and retail environments, and in many different geographies. We are pleased to finish 2016 with above-plan results in the fourth quarter. Net sales increased 6% and comp sales grew 3%, over a very strong 6% increase last year. Once again, customer traffic drove the comp increase and our merchandise margin was up. Earnings per share were $1.03, significantly above our expectations. We believe our continued sales, traffic and merchandise margin growth speaks to the fundamental strength of our business. Looking ahead, we feel great about our prospects for growth in the near and long-term in building on our market share. We have many initiatives underway to drive sales and customer traffic. We are confident we will achieve our goals, and as always, we will strive to exceed them. In 2016, we surpassed $33 billion in sales, which gives us great confidence as we continue to grow TJX as the only major international off-price retailer in the world. Before I continue, I'll turn the call over to Scott to recap our fourth quarter and our full-year numbers. Scott Goldenberg - The TJX Cos., Inc.: Thanks, Ernie, and good morning, everyone. We have a lot to share on this call and want to leave enough time for your questions, so in the interest of time, I am not going to repeat many of the numbers in the press release and will instead focus on the financial highlights. We are very pleased that our sales and traffic momentum continued in the fourth quarter. Again, our 3% comp was over a 6% last year and above our plan. Further, our comp was driven by traffic again this quarter. As a reminder, this comp excludes our e-commerce businesses. Diluted earnings per share were $1.03 versus last year's $0.99, well above our expectations. It was great to see strong EPS flow through on the above-plan sales. EPS growth was negatively impacted by 3% due to wage increases and 5% due to foreign currency and transactional foreign exchange. Merchandise margin was up significantly again in the fourth quarter. At the end of the fourth quarter, consolidated inventories on a per store basis, including inventories held in warehouses but excluding in-transit and e-commerce inventories, were down 4% on a constant-currency basis. We begin a new year with excellent liquidity and are well-positioned to flow fresh spring fashions and selections to our stores. Now to recap our fourth quarter performance by division. Marmaxx comp increased a strong 3% over a 6% increase last year. Once again, customer traffic was the primary driver of the comp increase. We saw significant growth in units sold and a decrease in average ticket as we planned. Apparel, accessories and home all performed well, which is great to see in today's retail environment. Segment profit margin decreased 30 basis points. Merchandise margin was up significantly, but was more than offset due to the negative impact from wage increases as expected and additional supply-chain costs. Marmaxx is now a $20 billion plus business and we still see plenty of room to grow our largest division. HomeGoods delivered another great quarter with comps increasing a very strong 5% over last year's 7% increase. Segment profit margin was down 50 basis points. As we anticipated, wage increases and supply chain costs associated with the opening of our new distribution center had a significant negative impact on HomeGoods' margin. HomeGoods had another outstanding year as it surpassed the $4 billion sales milestone. TJX Canada's fourth quarter comps grew a strong 4% over a 14% increase last year. Adjusted segment profit margin, excluding foreign currency, was up 40 basis points and merchandise margin was up significantly. TJX Canada had an excellent year, opening up its 400th store, achieving US$3 billion sales and delivering strong performance across all three chains. TJX International comps were up 2% in the fourth quarter. Adjusted segment profit margin, excluding foreign currency, was down 50 basis points, due to integrating Trade Secret, wage increases and some expense deleverage. We were pleased with our performance and believe we held up better than most European retailers despite the challenging retail environment. We are convinced that we are gaining market share in Europe and feel great about this division's long-term growth plans. Now to our full year consolidated fiscal 2017 results. Again, we are thrilled that our 5% comp increase over last year's 5% increase was above our plan and driven by customer traffic. Further, the traffic was the primary driver of the comp increase at each of our four major divisions. Diluted earnings per share were $3.46 versus last year's $3.33. Excluding a third quarter debt extinguishment charge and pension settlement charge totaling $0.07, adjusted earnings per share were $3.53, a 6% increase over last year and above our most recent plan. Full-year EPS growth was negatively impacted by 3% due to wage increases and 2% due to foreign currency and transactional foreign exchange. Merchandise margin was up significantly for the year on top of a solid increase last year. I'll finish with our financial strength and shareholder distributions. Our business continues to generate excellent cash flows and strong financial returns. In fiscal 2017, free cash flow was $2.6 billion and our ROIC remains one of the highest we have seen in retail as we maintain our disciplined approach to capital allocation. As we said before, we remain committed to returning cash to our shareholders through our share repurchase and dividend programs, while simultaneously reinvesting in the business for the near and long-term. In fiscal 2017, we returned $2.4 billion to shareholders through these programs. Now, let me turn the call back to Ernie and I'll recap our first quarter and full year fiscal 2018 guidance at the end of the call. Ernie L. Herrman - The TJX Cos., Inc.: Thank you, Scott. First, I'll cover some fourth quarter highlights. Again, we were pleased to end the year with another quarter of strong sales and customer traffic on top of an excellent fourth quarter last year. I believe our exciting gift-giving assortments and in-store initiatives during the holiday selling season were the best we have had yet. We are confident that our marketing helped attract new and existing customers and our constantly-changing selections and freshness encouraged more frequent shopping visits. Now, I'd like to briefly highlight our key strengths that we believe will continue to differentiate TJX and make our business so difficult to replicate. First, we have a world-class buying organization, which includes over 1,000 associates around the world. I truly believe they are the best in retail. Secondly, we see ourselves as a global sourcing machine, buying from a universe of over 18,000 vendors in more than 100 countries. Third, off-price is all that we do. Over four decades, we have built and continued to refine a global supply chain, distribution network and IT systems that support our highly-integrated international off-price business model. Fourth, we have decades of off-price operating experience in the U.S., Canada, and Europe, and are capitalizing on our global presence. Next, our flexibility allows us to react to changing market trends and consumer tastes to give shoppers what they want and when they want it. These core strengths have allowed us to successfully grow our business across all of our geographies, while delivering consumers a rapidly-changing mix of merchandise at amazing values. Now, to our growth initiatives, which give us confidence in our ability to gain market share for many years to come. Our number one initiative remains driving customer traffic and comp sales. We were very pleased with our traffic gains in 2016 and the growth in new customers that we saw across all our divisions, particularly with Millennial shoppers. At the same time, we believe there was enormous opportunity to keep growing our U.S. and international market share, and we will continue to target a very wide range of shoppers. To attract more shoppers, we take an integrated marketing approach, engaging with consumers through television, digital, mobile and social media campaigns to ensure our retail brands are visible wherever they are looking. We incorporate learnings to further leverage our marketing dollars and to increase awareness of our brands in an ever-changing media world. We also continue to grow our loyalty programs to drive more frequent visits and cross shopping of our brands. We continue to upgrade the shopping experience. In 2017, we expect to remodel approximately 260 stores across the company. Our customer satisfaction scores increased at every division in 2016, which is great, but meanwhile, we see room to do even better. Most importantly, we continue to add new brands and offer consumers tremendous values. With e-commerce, we continue to differentiate our mix to encourage consumers to shop both online and in our stores. While still a small piece of our overall business, we view e-commerce as complementary to our stores and as another way to drive incremental sales and traffic. Next, innovation has been core to our DNA at TJX since the start. We are always testing new ideas and initiatives across the company that could drive future growth. For us, innovation could take on a number of different forms. Today, I am very pleased to share several developments with you, beginning with some exciting news about our U.S. home business. With many years of successful growth both at HomeGoods and our home businesses across the company, we are thrilled to announce that we are launching a second home concept. The first few stores are expected to open later this year. Our approach will be to differentiate these two U.S. home concepts to encourage customers to shop both stores, which has been key to our successful growth at T.J. Maxx and Marshalls in the U.S. and Winners and Marshalls in Canada. We plan to leverage our existing distribution centers, supply chain and buying organization, which is similar to what we did when we launched Marshalls in Canada. While we are proud to have grown HomeGoods' customer base for many years, we believe we remain significantly underpenetrated in the total U.S. home market and enormous opportunity remains for us to gain share in this space. Our customers are passionate about HomeGoods, and we are confident they will love our new home concept too. As to our HomeGoods chain, we plan to increase our openings this year. In another example of innovation and our flexibility, about 20 of these openings are planned within some of our larger existing Marmaxx stores. By flexing our existing locations, we believe we can drive additional productivity and increase the overall efficiency of the store. Further, it allows us to introduce HomeGoods to additional U.S. markets more quickly and efficiently. In Australia, we have made excellent progress integrating Trade Secret into our TJX model since our acquisition over a year ago. We are excited to announce that we will be converting our stores in Australia to T.K. Maxx this spring, which we believe will further benefit this business by leveraging one of our powerful global brands. We also have a handful of store openings planned for 2017 and plan to market the business in Australia for the first time. Our research shows that Australian consumers already know and love the T.K. Maxx brand. We are confident that this conversion, combined with the improvements we have already made in the business and our new marketing campaign, will help us attract a broader set of value-oriented customers. T.K. Maxx is known and loved across Europe, and we are confident that it will succeed in Australia as well. At Sierra Trading Post, we are testing our brick-and-mortar format and transitioning the online business to offering great off-price values every day. We have strengthened the buying organization and have additional store openings planned across the U.S. this year. Wrapping up on these initiatives, we see ourselves as leaders in innovation, and will never be complacent. Our next major growth driver is our enormous global store growth potential. In fiscal 2017, we grew our store base by 198 stores or almost 6%. I also want to point out that we did not close a single store last year, despite the volatile retail environment. We continue to see a favorable real estate environment and are taking advantage of many opportunities around the world. This year, we are planning to accelerate our pace of store growth and surpass the 4,000 store milestone. Underscoring our confidence is our disciplined approach to real estate, decades of operational experience, our eclectic mix of merchandise, and differentiated in-store shopping experiences. With just over 3,800 stores today, we see the potential to grow by almost 50% to 5,600 stores long term. This would be about 1,800 more stores over our current base with just our existing chains and just our existing countries alone. To reiterate, this does not contemplate the opportunities we see with additional countries or with new chains. In North America alone, we see the potential to open about 1,300 more stores. At Marmaxx, we see the long-term potential to grow to 3,000 stores, about 800 more than today. Again, we see enormous white space for our U.S. home business. Our 1,000 long-term store potential estimate for HomeGoods only and does include our new U.S. home concept. In Canada, our long-term store growth target of 500 stores includes growing Marshalls to at least a 100-store chain. Beyond North America, our long-term potential for TJX International of 1,100 stores reflects the opportunity we see in just our current European countries and Australia. In Europe, we remain the only brick-and-mortar off-price retailer of significant size. In Australia, we are very confident that we can grow T.K. Maxx to 125 stores long term. To support our growth, we are making important investments in new stores, store remodels, distribution centers, systems and our new seeds as well as talent. I am convinced that we are making the right investments today to strengthen our leadership positions around the world and support the near and long-term growth of our company. In closing, we are proud of our excellent performance in 2016. Looking ahead, we feel very good about our business model and see tremendous growth potential. We operate a highly flexible retail business with four decades of expertise and experience in building and refining our highly-integrated international teams and infrastructures. We are also very pleased that we have the financial flexibility to simultaneously reinvest in the growth of our business and return significant value to shareholders. We have a clear, long-term vision for growth and see an exciting future ahead for TJX, both in the U.S. and internationally. Now, I'll turn the call over to Scott to go through our guidance. Then we'll open it up for questions. Scott? Scott Goldenberg - The TJX Cos., Inc.: Thanks, Ernie. Now for fiscal 2018 guidance beginning with the full year. This guidance includes a 53rd week in the fiscal 2018 calendar, which we expect will benefit full-year EPS growth by approximately 3% or $0.11 per share. On a GAAP basis, we expect fiscal 2018 earnings per share to be in the range of $3.80 to $3.89. Excluding the benefit from the 53rd week, we expect adjusted earnings per share to be in the range of $3.69 to $3.78. This would be up 5% to 7% versus the adjusted $3.53 in fiscal 2017. I want to take a moment to recap a few factors impacting our expected earnings per share growth in fiscal 2018. First, we are assuming that wage increases will have a negative impact to fiscal 2018 EPS growth of about 2%, which is less than last year. We continue to anticipate that wage increases will have an incremental negative impact beyond fiscal 2018. Based on current approved legislation, we expect the pressure to further moderate next year. Second, we anticipate that the recent change in accounting rules for share-based compensation will benefit fiscal 2018 EPS growth by approximately 2% or about $0.08. As always, we plan to continue to invest strategically to support our U.S. and international growth. As we've discussed on prior conference calls, the incremental investments we have planned for fiscal 2018 include costs associated with our distribution network to support our global store growth plans. As to FX, at current rates, we expect the net impact of foreign currency and transactional foreign exchange to have a slightly negative impact on fiscal 2018 EPS growth. This year, the expected impact is primarily the result of the decline in the British pound versus the prior year. While it's too early to call – too early for us to make assumptions about the impact of foreign exchange beyond fiscal 2818, FX could have a neutral or positive effect in the out years. This EPS guidance assumes consolidated sales in the $35.2 billion to $35.6 billion range, a 6% to 7% increase over the prior year. This guidance assumes a positive impact to reported revenue of approximately 1.5% due to the 53rd week and a negative impact to reported revenue of about 1% due to translational FX. We're assuming a 1% to 2% comp increase on a consolidated basis, similar to our plans for prior years. The comps by definition exclude the 53rd week. Our assumptions for total sales and comp growth remain in line with how we have planned for prior years. We see many ways to drive continued sales traffic and market share as we are pursuing them aggressively. We expect pre-tax profit margin to be in the range of 11.1% to 11.3%. Excluding the benefit from the 53rd week, we expect adjusted pre-tax profit margin to be in the range of 10.9% to 11.1%. This would be down 40 basis points to 60 basis points versus the adjusted 11.5% in fiscal 2017. We're planning gross profit margin to be in the range of 28.9% to 29.0% compared with 29.0% last year. The 53rd week is expected to have a 20 basis point benefit to gross profit margin. Our plans assume we will maintain our strong merchandise margin. We're expecting SG&A as a percentage of sales to be in the range of 17.6% to 17.7% versus 17.4% last year. We do not expect the 53rd week to have a significant impact on full-year SG&A expense. For modeling purposes, we're currently anticipating a tax rate of 36.9%, net interest expense of $37 million and a weighted average share count of approximately 649 million. Now to our full-year guidance by division. Sales and pre-tax margin guidance are on a 53-week basis. At Marmaxx, we are planning comp growth of 1% to 2% on sales of $22.2 billion to $22.4 billion and segment profit margin in the range of 13.7% to 13.9%. At HomeGoods, we expect comps to increase 2% to 3% on sales of $5.0 billion to $5.1 billion and segment profit margin to be in the range of 13.1% to 13.3%. For TJX Canada, we are planning a comp increase of 2% to 3% on sales of $3.4 billion to $3.5 billion and adjusted segment profit margin, excluding foreign currency, to be in the range of 13.8% to 14.0%. At TJX International, we're expecting comp growth of 1% to 2% on sales of $4.5 billion to $4.6 billion and adjusted segment profit margin, excluding foreign currency, to be in the range of 4.3% to 4.5%. ` Moving on to Q1 guidance; we expect earnings per share to be in the range of $0.76 to $0.78 versus last year's $0.76. This guidance assumes an expected negative impact to EPS growth of approximately 3% due to wage increases. It also includes a 6% benefit to EPS growth due to the combination of foreign currency and transactional foreign exchange, and an additional 1% benefit to EPS growth due to a change in accounting rules for share based compensation. We're modeling first quarter consolidated sales of approximately $7.8 billion. This guidance assumes a 1% negative impact to reported revenue due to translational FX. For comp sales, we are planning the first quarter more conservatively. We're assuming comp growth in the 0% to 1% range on both a consolidated basis and at Marmaxx. This compares to a very strong 7% increase at TJX and a 6% increase at Marmaxx in the first quarter last year. As a reminder, these strong comp increases benefited from favorable weather as we discussed in last year's call. This year, we have experienced some unfavorable weather early on. Beyond that, it's far too early to draw any conclusions. First quarter pre-tax profit margin is planned in the 10.3% to 10.5% range versus 10.9% the prior year. We're anticipating first quarter gross profit margin to be in the range of 28.7% to 28.8% versus 28.8% last year. We're expecting SG&A as a percentage of sales to be in the 18.2% to 18.3% range versus 17.7% last year. For modeling purposes, we're anticipating a tax rate of 37.7%, net interest expense of about $10 million and a weighted average share count of approximately 654 million. It's important to remember that our guidance for the first quarter and full year assumes that currency exchange rates will remain unchanged from the levels at the beginning of the first quarter. Moving to our store growth plans for fiscal 2018, we plan to add about 250 net new stores, which would bring our year-end total to approximately 4,062 stores. This represents a store growth of approximately 7%, above our store growth for the last several years. Beginning in the U.S., our plans call to open about 65 stores at Marmaxx. For HomeGoods, we expect to open approximately 85 stores, including four for our new U.S. home concept. Also, we plan to open 15 additional Sierra Trading Post stores. In Canada, we plan to add about 35 new stores. At TJX International, we plan to open approximately 45 stores in Europe and four stores in Australia. I'll wrap up with our cash distribution to our shareholders. As we outlined in this morning's press release, we expect that our board of directors will increase our quarterly dividend by 20% on top of the 24% increase last year. This would mark our 21st straight year of dividend increases. In fiscal 2018, we plan to buy back $1.3 billion to $1.8 billion of TJX stock. Even with our significant shareholder distributions, we still plan to end fiscal 2018 with approximately $3.3 billion in cash and short term investments, which underscores our financial flexibility. Now, we are happy to take your questions. To keep the call on schedule, we're going to ask that you please limit your questions to one per person. Thanks, and now we will open up for questions.

Thank you. We will now begin the question-and-answer session. And our first question comes from the line of Mr. Matthew Boss. Sir, your line is open. Go ahead. Matthew Robert Boss - JPMorgan Securities LLC: So as we think about your underlying margin profile, from 11% to 12% operating margins today and putting the impact of the wages aside, are you still comfortable – I guess my question is, are you still comfortable with the 1% to 2% annual segment margin expansion or are there any offsets to consider as we think about that multiyear? Scott Goldenberg - The TJX Cos., Inc.: Matt, Scott Goldenberg. I'm not sure what you mean by the 1% to 2% margin expansion, or... Matthew Robert Boss - JPMorgan Securities LLC: So in the 10% to 13% annual earnings growth that you laid out in 2015, 6% to 7% top line, 1% to 2% segment profit margin expansion. I'm just trying to back into the bottom line earnings growth algorithm as it was last laid out, assuming the sales are the same, is there any difference in that profit margin expansion on an annual basis, if we were to back out wages, more trying to think beyond this year? Scott Goldenberg - The TJX Cos., Inc.: Yeah, it's been almost two full years now since we've given out the long-term model, and as we talked about I think almost every quarter for the last two years, we haven't been giving detail on our long-term model at this point. So the better way maybe to look at it this year is on the 1% to 2% comp that we are guiding to, we have the 53-week benefit, so we're going out with 12% at the high to $3.89. The 53rd week's worth 3%. We had the one time – last year, we had the debt extinguishment and settlement, which is worth 2%, getting to the 5% to 7%, which includes some of the share-based compensation that we called out (34:13). So a 5% on a 2% comp would be the best way to rec, if you were going to rec to what we've done the last year or two. Again, only on a 2% comp, this year 6% was on a higher comp. Compared to the plan that we went out last year where we went out at the high end of the range with a 2% EPS growth rate on the 1% to 2% comp, there's been some moderation in the FX and in the wage. All things, the model is relatively similar to it has been in the past. And at this point, we still have, as I called out earlier, some wage pressure that we think is going forward, some investments to support our growth. So we're not really commenting on it much than that, but Ernie is going to weigh in also on that. Ernie L. Herrman - The TJX Cos., Inc.: Yeah, I think all I would say, Matt, is that for all of the things we talked about in the script, in terms of the fundamental strength, we have a high degree of confidence in all of the differentiators and the way we can take advantage of the environment we're in. And as much as we're not giving specifics on the long-term growth, we're really feeling that we would expect our earnings per share growth to slightly improve each year over the next couple of years. So we're seeing that like – we're feeling pretty comfortable, we'll see that ticking up. Barring everything stays apples-to-apples in terms of wage, state-by-state, all around us. So, hopefully, that adds some more color to you. Matthew Robert Boss - JPMorgan Securities LLC: No, it does. Thanks, guys. Best of luck.

Thank you. Our next question comes from the line of Ms. Lindsay Drucker Mann. Ma'am your line is open. Go ahead, please. Lindsay Drucker Mann - Goldman Sachs & Co.: Thanks. Good morning, guys. I was hoping you could give some color on in the markets where you're nearby to a closed Macy's, if you're seeing any impact on the performance in your stores from those liquidations or how you're sort of thinking about momentum in those stores in those shared markets? Ernie L. Herrman - The TJX Cos., Inc.: So we really haven't seen anything dramatic there. What's happening is there's a lot of noise around, Lindsay, in terms of the market share gain because what's happening clearly is there's just a couple of sectors in the businesses, obviously, online is one of them and in off-price, ourselves and others is the other and clearly gaining market share. Some of that could be because of stores closing but some of the noise gets – it gets kind of tough to do all of these analyses because you also have some businesses, even if they're not closing they're down trending. So, obviously, there's market share that's being capitalized on from a few different ways. So we don't see really a specific pattern in that. Not to say that it wouldn't happen over time. Some of those closings are more recent, but over time it's possible. Hopefully that helps answer your question though. Lindsay Drucker Mann - Goldman Sachs & Co.: Got it. And if I could just maybe sneak one more in. Ernie, maybe you could clarify or Scott on the comment about unfavorable weather early on and I think it was favorable weather in the prior year. Just a little more detail on what you're thinking about weather. Ernie L. Herrman - The TJX Cos., Inc.: Yeah, we actually – we were quite specific last year at the end of – when we did the first quarter call, Scott and I were quite transparent about how favorable the weather was. We also didn't want people getting too used to the comps that we delivered in the first quarter last year because it was so strong given one of the most favorable weather patterns we had ever seen in our first quarter. So I would say that our weather pattern this year is a little bit more like a traditional first-quarter weather pattern which, as you know, unfortunately, isn't as favorable as last year's. So that's what really we're talking about. So that gives you a little bit of a fall-off, which is a little piece of our first quarter guidance there. Having said that, it's still early for us to be talking about the first quarter because we have a lot of the quarter to go and the important thing I think everyone needs to remember and I like to reiterate is that our business model really differentiates us by the flexibility that we have. So we are able to capitalize and react and read to the marketplace and move much quicker than most of the other major retailers. So getting away from the weather situation, which other retailers could feel as well, if you say, well that could happen to everyone, you would think that could create opportunities and that's where our business model really plays out. We're able to take advantage of those. So we're in a strong liquidity position and I would tell you we're in a wait-and-see mode. So we want to really, right now, not based on what's going on around us, we would just want to take that conservative approach for first quarter, and believe me, our teams are all driven to exceed the plans. As Scott has said many times, we want to have conservative plans though. Based a little bit on the weather thing you asked about, based a little bit on the environment, we just said let's be conservative. We have liquidity, we can flex, and again, our intention is to always exceed our plans. Lindsay Drucker Mann - Goldman Sachs & Co.: Great. Thanks so much. Ernie L. Herrman - The TJX Cos., Inc.: Welcome.

Thank you. Our next question comes from the line of Mr. Omar Saad. Sir, your line is open. Go ahead, please. Omar Saad - Evercore ISI: Thanks. Good morning. Ernie, I actually really enjoyed some of your prepared remarks. I'd love to ask about the new home concept, but I think I'd rather use my one question to talk about the... Ernie L. Herrman - The TJX Cos., Inc.: You know you're limited, Omar? Omar Saad - Evercore ISI: The news on the Trade Secret and kind of converting it to more of a T.K. Maxx. It's interesting because – I'd love to kind of have maybe a clear picture of how you got comfortable with the visibility of that nameplate and the recognition in the local marketplace in Australia because it may have implications for other new markets as you enter them. I don't know if tourists in the U.S. or Europe are really learning about the T.K. Maxx concept, and that's what drove that decision? Anything would be helpful there. Thanks. Ernie L. Herrman - The TJX Cos., Inc.: Yeah, sure. Great question, Omar. A couple things we're playing into it. The first of all, ironically – this is anecdotal – on my first trip over there, I was with Michael MacMillan who obviously the business reports to, and we had a couple of customers while we were walking through the store, they must have known we were management, and said they were traveling from other places, and they asked us, is this a T.K. Maxx because they were confused. And clearly it wasn't. It was a Trade Secret. So right away – and then of course we did more studies. We knew that the brand was important. I would tell you we have been thinking on and off about doing this a lot earlier, but we did not want to do it till we had made the progress on the merchandising and distribution and supply chain lines to get the stores in the place where we felt it was okay to put the T.K. Maxx brand on it. So it's a great question, Omar, because we weren't ready. One reason, it's like now is we weren't confident enough, quite honestly, a few months ago, say, put the name on it. Now we have made tremendous progress. I could not be more excited about the business that we've been seeing of recent the last couple of months, and we have been doing these remodels. Some of our associates here that have recently been over there have talked about how great the remodels is. Look, it's just T.J. – you would feel like you're in a T.J. Maxx or a T.K. Maxx. And now the most important thing is the merchandise is reflecting the content that we are proud of where we say now we're comfortable rebranding it to T.K. Maxx, because you can imagine we did not want to do that if we didn't think the mix was up to what that brand is. So I hope that answers your question and all I can tell you is if you ever have a chance to be there you would find it to be a very exciting format. And the customer base there is – Scott has been there fairly recently, would tell you, the customer base is really in our sweet spot and they're very value driven. They just haven't had options much in the past. Scott Goldenberg - The TJX Cos., Inc.: Yeah, and as Ernie said, between the remodels we've been doing at the back half of this past year and the remodels we're doing this spring, we'll have most of the stores that we want remodeled by the time we launch the conversions and the marketing campaign in the spring this year. And it also helped that last year, we opened up a distribution center, so now we're able to ship the way we ship in our off-price model and the rest of our divisions and give those stores the multiple deliveries they get a week that keep the freshness. So we're excited. Omar Saad - Evercore ISI: And you had mentioned 120-store potential opportunity there. Could you just remind us how many there are now and how many have been converted and then remodeled? Ernie L. Herrman - The TJX Cos., Inc.: We haven't given – there's 35 stores now and let's just say the majority will be converted – well, they will all be converted, but the remodels will be remodeled and there will be four openings this year. Scott Goldenberg - The TJX Cos., Inc.: Four new stores on top of that. Ernie L. Herrman - The TJX Cos., Inc.: But it's really the first-time marketing the business coming up here in the near future. Omar Saad - Evercore ISI: Thank you, guys. Appreciate the color. Ernie L. Herrman - The TJX Cos., Inc.: You're welcome.

Thank you. Our next question comes from the line of Mr. Michael Binetti. Sir, your line is open. Go ahead, please. Michael Binetti - UBS Securities LLC: Hey, guys. Good morning. Thanks for all the detail on the call today. Very helpful. Just a quick one for the model, I think you said that the expectation for the next year is for the merch margins to be, I think, you said stable to last year's. Is there any reason why the merchandise margin improvement that you guys saw recently slows over the next year and then I had a quick follow up? Scott Goldenberg - The TJX Cos., Inc.: Well, we plan the model pretty similarly every year. We're planning the merchandise margin up on top of a fairly significant – almost – approximately 20 basis point increase this year, so we do still have some margin pressure, approximately 10 basis points relative to the drop in the British pound, as the drop in the spring after the Brexit announcement. So we have the pressures well, but we know it's – we've had – we feel pretty good. We continue to work on our planning and allocation and our inventory management and we've certainly had increases for each of the last five years, but it's, again, we still think there's room for improvement, but we're just planning it slightly up. Michael Binetti - UBS Securities LLC: Okay. And then if I just could quickly follow up, if we could just zero in, with so much of the calls taken up with your global business these days, on the supply chain spending in the long-term pretty consistent reinvestment you guys have talked about, but that's been a source of deleverage for a lot of quarters in a row. You guys keep investing ahead of the opportunity. Can we think about a global supply chain investment bucket and just think about whether there's a point somewhere on the horizon where that could flip over and be a source of leverage or you'd say, we've got sufficient supply chain in all the markets we're in at this point where we enter maybe the next couple of years where that's not a deleverage point. Scott Goldenberg - The TJX Cos., Inc.: Yes. It's a great question. I think some of it has to do – some of this is short and medium term and then there's long term. I think HomeGoods is a great example of something that's the longer term where clearly we couldn't call it all out, but I think our investment there was highly correlated to what we saw as the opportunities to grow market share and our store. So we had to invest in DCs ahead of our increased growth in our both new stores and HomeGoods, the store conversions Ernie talked about in the new store concept, so there's a case where you need to build out ahead of the growth. In terms of talking – we've talked about this before, Marmaxx, some of this was unforeseen as the average retailer decreased a bit more but we, again, think that has been extremely positive both – obviously it's a combination of both mix and price, but to our overall growth, it could go other way if retails stabilize and go the other way where you could end up – some of the growth we have in DCs, the out years could be delayed and we would get some synergies and you're talking about a reverse average ticket. Other than that, just some of it's been a timing of replacing DCs that were older as we've had in both – what we're going to be doing in Europe this year and we may have in Marmaxx in a couple years. So I think it's going to be more lumpy, but we still see, given the growth trajectory that we called out in the new store growth, it's still going to be an impact at least for the next year or two. And then we would hope it moderate, but there are too many factors to be crystal clear at this point on what that deleverage or flattening will be or when it will be. Michael Binetti - UBS Securities LLC: All right. Thanks a lot, guys.

Thank you. Our next question comes from the line of Ms. Lorraine Hutchinson. Ma'am, your line is open. Go ahead, please. Lorraine Maikis Hutchinson - Bank of America Merrill Lynch: Thanks. Good morning. I wanted to follow up on the comments you actually just made on average ticket. Been a couple of years, I know part of that is purposeful as you move into new categories, but where do you think we are in that move? And then also, what do you see in terms of pressure from the full price channel impacting the rest of your ability to increase that average ticket over the next couple of years? Scott Goldenberg - The TJX Cos., Inc.: Yes, so let me get to the short-term piece of that before Ernie goes on, on the broader piece. Speaking at Marmaxx, both the fourth quarter of this past year and the first quarter of what we see this year was primarily almost entirely due to mix. So that really has little to do with the pricing dynamic or what the other – because we're maintaining our value equation with the other retailers. It's just that we – as we've always done, have tried to adjust the mix to we see what the customer preferences are. And that has just spurred to a slightly lower average retail. Ernie L. Herrman - The TJX Cos., Inc.: Yeah, some of the – let me piggyback on that, some of the – Lorraine, some of the hot categories just by nature and it's just the nature of the beast we run into have been lower ticket categories. If you even think about the home business and some of the categories we've gone after there, you can see them in our store. They have been some lower ticket categories as has been some of our other businesses. And that's making, to Scott's point, the average ticket still to continue to come down. We have said numerous, numerous times our number one objective is to continue gaining market share. So, we don't feel comfortable managing that from the top and taking us off the mission to continue to drive top line sales. Although I heard your right – I think you had like a second part of your question about the regular price, do I have this right, about the pressure from regular price retailers? Lorraine Maikis Hutchinson - Bank of America Merrill Lynch: Yes. Ernie L. Herrman - The TJX Cos., Inc.: Yeah, so we've seen – it feels like out there that things are a little bit more promotional currently, but we don't know that for a fact, nor do we know how long that goes on. The good news is we operate very bottom-up from the buyer level up where we constantly shop all retails and ensure that our GAAP is below them. So I think what you're getting at is if they continue to get promotional, could that hold our ticket down. That's another factor that, yes, part of our model was to always never be undersold. So that could. That has not really been a driver of it because we've – as witnessed by our market share gains, we've been keeping quite the appropriate gap in retail between us and the other retailers. So I don't see that as being a big switch going forward, but in this environment, it's hard to look too far out because there's so much unknown still. Scott Goldenberg - The TJX Cos., Inc.: And at the same time, for the last couple of quarters, at least, and we still think for the first quarter, we've been able to give the customer that value... Ernie L. Herrman - The TJX Cos., Inc.: Absolutely. Scott Goldenberg - The TJX Cos., Inc.: ...and have our merchandise margin go up... Ernie L. Herrman - The TJX Cos., Inc.: And the margin hang in there, right. Scott Goldenberg - The TJX Cos., Inc.: ...over the last at least the recent times. Lorraine Maikis Hutchinson - Bank of America Merrill Lynch: Thank you. Ernie L. Herrman - The TJX Cos., Inc.: Welcome.

Thank you. Our next question comes from the line of Mr. Oliver Chen. Sir, your line is open. Go ahead. Oliver Chen - Cowen & Co. LLC: Thank you. Congrats on really outstanding results. We had a question – in relation to the overall retail industry, there's been this trend of store closures, but you've had a real steadfast and demonstrate-able progress in opening stores. So as you think about North America, are you looking at expanding into new markets or is that adding depth into your existing markets? And have there been thoughts or tweaks or a framework, which has been altered? Or how do you think about that as we think about really justifying the long-term growth algorithm in the face of what we're seeing at malls and Amazon and others? Thank you. Ernie L. Herrman - The TJX Cos., Inc.: Sure. So, Oliver, I think it's kind of a multi-pronged question because it's kind of a mix. We have so many brands now. So if you look the one thing we talked about is HomeGoods, for example, right, this year is going to open – we're going to open in our HomeGoods division like 85 stores, of which four are the new concept. But that still leaves a chunk of stores and many of those are hitting new markets. In fact, those conversion stores we talked about that are in some of the Marmaxx stores are actually hitting markets that HomeGoods would not have been in. So we are specifically, in that case quite specifically, hitting new markets with that brand. If you look at T.J. Maxx and Marshalls, you're running into places where we are in so many places already. You're starting to get to different markets, but maybe B and C markets in a different trading area. So a little bit – not such a green empty market for us, but one where we can do more business with the appropriate population and demographics. So it's a bit of a mix. We have some Sierra Trading Post stores open. Those are clearly going into new markets because it's such a young business. If you think it down the road of the new concept in home that we just extended because we just believe home continues to present for us because of the way we do it in such a differentiated value manner, just continues to create this enormous opportunity for TJX in total. If you think about this new business, which is only starting with four stores later this year, that to us is a – you're talking about going to all the markets because it's a new business and we're going to be going after categories that aren't so penetrated in the HomeGoods store and are going to allow us to actually go after categories in other markets that we're not in at all with those type of product categories. And we've actually – just so, we've been testing – you guys would not realize this, but we've been testing many of those home categories for the last year and year-and-a-half. You guys wouldn't realize it by the way we've been testing it, but that's allowing us to plant the seeds and feel a high degree of confidence on what the store can do for business when it starts up later on this year. So good question, I think it various almost by each of our brands a little bit. Hopefully that helps. Oliver Chen - Cowen & Co. LLC: And, Ernie, you touched upon remodels. Maybe you could just articulate a little bit about what we should know and what we should prioritize in thinking about remodels? You've been very flexible already with how you move and groove the store experience. So I'm just curious about mentioning remodels and what it means for the long term of the company at large. Ernie L. Herrman - The TJX Cos., Inc.: So that's pretty, Oliver, kind of what – it's just a basic strategy we have to ensure that our chain is up-to-date and that we don't lose – so in some cases, by the way, we have found and it's a little cloudy at this point. In some cases we actually got a little sales lift, and a lot of cases you're trying to ensure that you don't deteriorate and you keep yourself up to the current standards that allow us to continue to make the customer happy from a shopping environment. And that's really where we've been. So we look at the customer service feedback, which I think I referred to in my script. We are constantly looking at that in a very timely manner, more so than we have for years, and we can kind of zero in on what stores between that. And our real estate team does a fantastic job of knowing when and where we need to pull the trigger to remodel a store. Again, we're fortunate because our brick-and-mortar business is healthy, and so we have the cash to keep reinvesting. That's another place where Scott is always having to manage all of our investments that we do, but we think remodels are critical. And we do believe it is one of the reasons that we continue to have a healthy brick-and-mortar business as we don't allow our stores to get outdated. And when we do our remodels, we look at functional improvements as well. It isn't just an atmosphere. It's a functional improvement approach in addition to an atmosphere redesign. So, yes, we are bullish. We do flex with it, and you'll see our remodel number vary a little year-to-year based on a bottom-up approach, feedback. Oliver Chen - Cowen & Co. LLC: Thank you. Best regards.

Thank you. Our last question comes from the line of Ms. Dana Telsey. Ma'am, your line is open. Go ahead, please. Scott Goldenberg - The TJX Cos., Inc.: Hello?

Ms. Telsey? Dana Lauren Telsey - Telsey Advisory Group LLC: Hi. Yes. Good morning and congratulations on the terrific results. Scott Goldenberg - The TJX Cos., Inc.: Thank you, Dana. Dana Lauren Telsey - Telsey Advisory Group LLC: As you think about the new concept opportunities with Sierra Trading Post, with what you're doing with the new home business, how do you think about the apparel category relative to these categories? Is there the opportunity for another new apparel business that would develop? And what the margin offsets are of these new potential businesses? Thank you. Ernie L. Herrman - The TJX Cos., Inc.: Right. Good questions. So first of all, let me address the first part on the apparel question that you're getting at. So, as you know, we're pretty dominant in apparel right now with our Maxx and Marshalls businesses in the states. I would tell you that a lot of the Sierra Trading Post business is apparel that we'll be looking at. There's nothing on the plate right now in terms of another brand, in terms of apparel, but that's not to say never. We're always looking and innovating and testing lots of ideas around here, and I would tell you that it's not that that idea has not come up. I would say we have toyed with different versions, but as you know we're pretty methodical in that we don't want to do too many things at once. So if you're us, what we're looking at right now is we have a high degree of confidence in our Australia business, which is a full-line store, very much we do, apparel driven. We like the way our Maxx and Marshalls business is going, and we're looking at where we think we are most underpenetrated from opportunity potential is in our home arena in the U.S. And it just screams at us. Obviously, and you're aware of all the success. So we are bullish in terms of some of the apparel parts of the Sierra Trading Post expansion, and we're bullish about those stores specifically. And getting at that, we've put a new infrastructure in place, a planning organization in place, and we've actually put some systems in place that are going to allow us to handle those apparel and non-apparel areas in a much more TJX-way of shipping and selling the goods. So, I know, I don't think I'm totally answering your question about where do we see apparel going, but I think you were trying to get the lay of the land, so to speak. Dana Lauren Telsey - Telsey Advisory Group LLC: Exactly. Ernie L. Herrman - The TJX Cos., Inc.: Okay. Dana Lauren Telsey - Telsey Advisory Group LLC: Yes. And what about cosmetics, there's been a lot of – beauty has been a bigger category or been a heightened-focus category, I just got eh email the other day. Is that an opportunity? Ernie L. Herrman - The TJX Cos., Inc.: I can't really comment specifically on a family business like that, but it's a good question. Very good question, Dana. Dana Lauren Telsey - Telsey Advisory Group LLC: Thank you. Ernie L. Herrman - The TJX Cos., Inc.: You're welcome. Ernie L. Herrman - The TJX Cos., Inc.: I guess we have taken our last call, and we would say again, we've been very excited to have this time with you guys today. Thank you all for joining us. We look forward to updating you on our first quarter earnings call in May. Thank you.

Ladies and gentlemen, that concludes your conference call for today. You may all disconnect. Thank you for participating.