MINNEAPOLIS, May 22 /PRNewswire/ -- Target Corporation (NYSE: TGT) today
reported earnings per share for the first quarter ended May 5, 2001 of
28 cents, compared with 26 cents in the first quarter ended April 29, 2000.
All earnings per share figures refer to diluted earnings per share. First
quarter net earnings were $254 million, compared with $239 million in 2000.
"We are pleased with our first quarter results, particularly in view of
the strength of last year's performance," said Bob Ulrich, chairman and chief
executive officer of Target Corporation. "We remain comfortable that we are
well-positioned to meet near-term economic and competitive challenges and
deliver reasonable growth in earnings per share for the full year. Over the
long-term, we remain confident in our ability to achieve average annual
earnings per share growth of 15 percent or more."
Total revenues in the first quarter increased 7.7 percent to
$8.345 billion from $7.746 billion in 2000, driven by a 10.7 percent revenue
increase at Target. Comparable-store sales for first quarter 2001 increased
1.7 percent.
In the first quarter, gross margin rate decreased from the prior year,
principally due to the mix impact of growth at Target, our lowest gross margin
rate division. Operating expense rate was favorable to first quarter 2000,
benefiting from overall growth at Target, our lowest expense rate division.
Pre-tax segment profit increased 6 percent to $573 million, compared with
$542 million in first-quarter 2000, as pre-tax profit increased 8% at Target
and 4% at Mervyn's. Marshall Field's pre-tax profit declined 20 percent.
(Pre-tax segment profit is earnings before LIFO, securitization effects,
interest, other expense and unusual items.)
Other Factors
For the quarter, pre-tax contribution from our credit operations increased
due to the continued growth of the Target Guest Card and improved performance
of the credit portfolios in all three business segments.
The total of interest expense and interest equivalent for the quarter
increased $10 million compared with first quarter 2000 due to higher average
funded balances, partially offset by a lower average portfolio interest rate.
The company's effective income tax rate was 38.0 percent, compared with
38.5 percent last year.
Miscellaneous
Target Corporation will webcast its first quarter earnings conference call
at 9:30am CDT today. Investors and the media are invited to listen to the
call through the company's website at http://www.target.com (click on
"company/Target Corporation/investor information/investors' overview"). A
telephone replay of the call will be available beginning at approximately
11:30am CDT today through the end of business on May 23, 2001. The replay
number is 800-633-8284 and the passcode is 18520802.
Forward-looking statements in this release should be read in conjunction
with the cautionary statements in Exhibit (99)C to the company's 2000 Form
10-K.
Target Corporation operates large-store general merchandise formats,
including discount stores, moderate-priced promotional and traditional
department stores. The company currently operates 1,321 stores in 46 states.
This includes 991 Target stores, 266 Mervyn's stores and 64 Marshall Field's
stores.
Target Corporation news releases are available at http://www.target.com or
prnewswire.com or by fax through Company News on Call at 800-758-5804
extension 342677.
TARGET CORPORATION
CONSOLIDATED RESULTS OF OPERATIONS
Three Months Ended
(Millions, except per share data) May 5, April 29, %
(Unaudited) 2001 2000 Change
Sales $8,197 $7,613 7.7%
Net credit revenues 148 133 11.8
Total revenues 8,345 7,746 7.7
Cost of sales 5,622 5,203 8.0
Selling, general and administrative
expense 1,951 1,834 6.4
Depreciation and amortization 256 224 14.3
Interest expense 106 96 10.8
Earnings before income taxes and
extraordinary charges 410 389 5.5
Provision for income taxes 156 150 4.2
Net earnings before extraordinary
charges 254 239 6.4
Extraordinary charges from debt
extinguishment, net of tax -- --
Net earnings $254 $239 6.2%
Earnings before extraordinary charges $0.28 $0.26 7.7%
Extraordinary charges -- --
Basic earnings per share $0.28 $0.26 7.5%
Earnings before extraordinary charges $0.28 $0.26 7.9%
Extraordinary charges -- --
Diluted earnings per share $0.28 $0.26 7.6%
Weighted average common shares
outstanding:
Basic 899.0 910.4
Diluted 908.5 921.2
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Millions) May 5, April 29,
(Unaudited) 2001 2000
ASSETS
Cash and cash equivalents $367 $301
Receivable-backed securities 1,748 1,467
Inventory 4,294 3,908
Other 1,029 861
Total current assets 7,438 6,537
Property and equipment, net 12,037 10,085
Other 901 806
Total assets $20,376 $17,428
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Accounts payable $3,285 $3,154
Current portion of long-term debt and
notes payable 1,442 581
Other 1,690 1,625
Total current liabilities 6,417 5,360
Long-term debt 6,174 5,172
Other 1,041 929
Shareholders' investment 6,744 5,967
Total liabilities and shareholders'
investment $20,376 $17,428
Common shares outstanding 900.1 910.0
Target Corporation
(Unaudited) (Millions)
REVENUES
Three Months Ended
May 5, April 29, %
2001 2000 Change
Target $6,771 $6,115 10.7%
Mervyn's 873 891 (2.0)
Marshall Field's 639 667 (4.2)
Other 62 73 (14.7)
TOTAL $8,345 $7,746 7.7%
COMPARABLE-STORE SALES
Comparable-store sales are sales from stores open longer than one year.
% Change
Three Months Ended
May 5, 2001
Target 2.8%
Mervyn's (1.6)
Marshall Field's (4.5)
TOTAL 1.7%
INVENTORY
May 5, April 29, %
2001 2000 Change
Target $3,112 $2,758 12.8%
Mervyn's 601 571 5.3
Marshall Field's 432 466 (7.4)
Other 149 113 n/a
TOTAL $4,294 $3,908 9.9%
Target Corporation
(Unaudited) (Millions)
PRE-TAX SEGMENT PROFIT AND EARNINGS RECONCILIATION
Pre-tax segment profit is earnings before LIFO, securitization effects,
interest, other expense and unusual items.
Three Months Ended
May 5, April 29, %
2001 2000 Change
Target $502 $467 7.7
Mervyn's 48 46 3.9
Marshall Field's 23 29 (20.0)
Total pre-tax segment profit 573 542 5.9
Securitization adjustment (interest
equivalent) (12) (12)
Interest expense (106) (96)
Other (45) (45)
Earnings before income taxes $410 $389 5.5%
EBITDA
EBITDA is pre-tax segment profit before depreciation and amortization.
Three Months Ended
May 5, April 29, %
2001 2000 Change
Target $686 $620 10.8%
Mervyn's 80 79 --
Marshall Field's 57 63 (8.2)
TOTAL $823 $762 8.1%
Twelve Months
Three Months Ended Ended
May 5, April 29, May 5, April 29,
2001 2000 2001 2000
Pre-tax Segment Profit as a % of
Revenues:
Target 7.4% 7.6% 7.5% 7.9%
Mervyn's 5.5% 5.2% 6.5% 5.1%
Marshall Field's 3.6% 4.3% 6.2% 9.1%
EBITDA as a % of Revenues:
Target 10.1% 10.1% 9.9% 10.1%
Mervyn's 9.1% 9.0% 9.7% 8.4%
Marshall Field's 9.0% 9.4% 10.7% 13.5%
NUMBER OF STORES AND RETAIL SQUARE FEET
Number of Stores Retail Square Feet
May 5, April 29, May 5, April 29,
2001 2000 2001 2000
Target 991 921 114,858 104,390
Mervyn's 266 267 21,555 21,635
Marshall Field's 64 64 14,174 14,175
TOTAL 1,321 1,252 150,587 140,200
Retail square feet in thousands; reflects total square feet less office,
warehouse and vacant space.
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SOURCE Target Corporation
CONTACT: Susan Kahn of Target Corporation, 612-370-6735/
