MINNEAPOLIS--(BUSINESS WIRE)--Jan. 27, 2009--Target (NYSE:TGT) today announced a workforce reduction at our
headquarters locations which affects 9 percent of our headquarters
population. This includes the elimination of approximately 600 employees
and 400 open positions, primarily in the Twin Cities area. The majority
of these changes are effective today. In addition, the company announced
it will close its Little Rock, Ark. distribution center, which currently
employs 500 people, later this year.
The company has recently undertaken other actions to manage expense and
capital investment and minimize the number of affected employees. These
actions include suspending salary increases for senior management,
suspending share repurchase activity, tightening credit card
underwriting and credit granting, implementing initiatives to improve
store productivity, reducing planned new store openings, and cutting
outside contractor support, travel, entertainment and other headquarters
"We are clearly operating in an unprecedented economic environment that
requires us to make some extremely difficult decisions to ensure Target
remains competitive over the long-term," said Gregg Steinhafel,
President and CEO of Target Corporation.
In recent months, Target has experienced weaker-than-expected sales,
which is pressuring earnings performance. Combined with the outlook for
continued difficult economic conditions well into 2009, the company is
taking a more conservative approach to business planning.
Headquarters employees affected by the announcement will continue to
receive their full pay and benefits through April 1, after which they
will receive a comprehensive separation package based on their years of
service. As part of that package, Target also will provide these
employees with 12 months of continued Target health care benefits in
addition to 12 months COBRA benefit, and outplacement support to assist
them in transitioning to their next position. Little Rock distribution
center employees will be offered positions at other Target distribution
centers, or will receive comparable severance.
As a result of these actions, the company expects to record a charge of
approximately 3 cents per diluted share, the majority of which will
occur in the company's 2008 fourth quarter. The company believes the
annualized benefit resulting from these actions will exceed the charge.
Target Corporation's retail segment includes large general merchandise
and food discount stores and Target.com, a fully integrated online
business. In addition, the company operates a credit card segment that
offers branded proprietary and Visa credit card products. The company
currently operates 1,682 stores in 48 states, 34 distribution centers
and employs approximately 350,000 people worldwide.
CONTACT: Target Communications
Media Relations, 612-696-3400
John Hulbert, 612-761-6735
Source: Target Corporation