Adjusted EPS of $1.11 Up 11.5% from First Quarter 2011
GAAP EPS of $1.04 Up 5.0% from First Quarter 2011
MINNEAPOLIS--(BUSINESS WIRE)--May. 16, 2012-- Target Corporation (NYSE: TGT) today reported first quarter net earnings of $697 million, or $1.04 per share. Adjusted earnings per share, a measure the company believes is useful in providing period-to-period comparisons of the results of its U.S. operations, were $1.11 in first quarter 2012, up 11.5 percent from $0.99 in 2011. A reconciliation of non-GAAP financial measures to GAAP measures is provided in the tables attached to this press release. All earnings per share figures refer to diluted earnings per share.
"We're very pleased with our first quarter earnings, which benefited from better-than-expected sales," said Gregg Steinhafel, chairman, president, and chief executive officer of Target Corporation. "While our outlook for the remainder of 2012 reflects continued economic uncertainty, we are confident in our strategy, keenly focused on delivering an affordable and inspirational merchandise assortment to our guests and committed to making thoughtful investments in our U.S. and Canadian business segments that we expect will reward our shareholders over time."
Fiscal 2012 Earnings Guidance
For second quarter 2012, the company expects adjusted EPS of $1.04 to $1.14 and GAAP EPS of $0.94 to $1.04.
For full-year 2012, the company has raised its guidance by 5 cents and now expects adjusted EPS of $4.60 to $4.80 and GAAP EPS of $4.10 to $4.30.
The difference between the GAAP and adjusted EPS ranges of 10 cents in the quarter and 50 cents for the full year represents the expected EPS impact of expenses related to the company's Canadian market entry.
U.S. Retail Segment Results
As previously reported, sales increased 6.1 percent in the first quarter to $16.5 billion in 2012 from $15.6 billion in 2011, due to a 5.3 percent increase in comparable-store sales and the contribution from new stores. Segment earnings before interest expense and income taxes (EBIT) were $1,199 million in the first quarter of 2012, an increase of 12.9 percent from $1,062 million in 2011.
First quarter 2012 U.S. Retail Segment EBITDA and EBIT margin rates were 10.3 percent and 7.3 percent, respectively, compared with 10.1 percent and 6.8 percent in 2011. First quarter gross margin rate declined to 30.2 percent in 2012 from 30.4 percent in 2011, reflecting downward pressure from the company's integrated growth strategies partially offset by a beneficial mix of higher-margin sales and underlying rate improvements within categories. U.S. Retail Segment first quarter selling, general and administrative (SG&A) expense rate was 19.9 percent in 2012 compared with 20.4 percent in 2011.
U.S. Credit Card Segment Results
First quarter average receivables decreased 6.0 percent to