Target Corporation reported net earnings of $483 million, or 56 cents per share, for the third quarter ended November 3, 2007 compared with $506 million, or 59 cents per share, in the third quarter ended October 28, 2006. All earnings per share figures refer to diluted earnings per share.
The company also announced that its Board of Directors has authorized a new $10 billion share repurchase program, replacing the previous authorization.
Third Quarter Earnings: "Our third quarter earnings were disappointing due to soft sales in our higher margin categories, leading to lower-than-expected gross margin in our core retail operations," said Bob Ulrich, chairman and chief executive officer. "However, we have not observed any meaningful change in the intensity of the competitive environment and continue to believe that we are well-positioned to operate in a variety of sales environments going forward."
Total revenues in the third quarter increased 9.3 percent to $14.835 billion from $13.570 billion in 2006, reflecting a 3.7 percent increase in comparable-store sales combined with the contribution from new stores and credit card operations. (Total revenues include retail sales and net credit card revenues. Comparable-store sales are sales from stores open longer than one year.)
Earnings before interest and income taxes (EBIT) were $958 million, compared with $957 million in the third quarter a year ago. A key factor in this EBIT performance was unfavorable gross margin performance resulting from weaker sales in higher margin categories such as apparel and home.
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