Target (TGT) 8-K Results of Operations and Financial Condition

Exhibit 99

FOR IMMEDIATE RELEASE	Contacts: Susan Kahn (investor)
	(612) 761-6735
	Cathy Wright (financial media)
	(612) 761-6627 or (847) 615-1538

TARGET CORPORATION SECOND QUARTER

EARNINGS PER SHARE $0.70

MINNEAPOLIS, August 10, 2006 — Target Corporation today reported net earnings for the second quarter ended July 29, 2006 of $609 million, or 70 cents per share, compared with $540 million, or 61 cents per share in the second quarter ended July 30, 2005. All earnings per share figures refer to diluted earnings per share.

“We are pleased with our second quarter and year-to-date results,” said Bob Ulrich, chairman and chief executive officer of Target Corporation. “We continue to believe Target will deliver strong sales and profit performance in 2006 and generate another year of profitable market share growth even in light of the challenges posed by the current economic environment.”

Total revenues in the second quarter increased 11.3 percent to $13.347 billion from $11.990 billion in 2005, driven by the contribution from new store expansion, a 4.6 percent increase in comparable store sales and the contribution of our 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 expense and income taxes (EBIT) in the second quarter of 2006 increased 15.9 percent to $1.134 billion, compared with $979 million in the second quarter a year ago. Both our core retail operations and our credit card operations contributed significantly to this EBIT growth. Within our retail operations, gross margin rate was essentially unchanged from an exceptional prior year level, while the company’s expense rate in the quarter was somewhat unfavorable to the prior year. (Gross margin rate represents sales less cost of sales expressed as a percentage of sales. Expense rate represents selling, general and administrative expenses expressed as a percentage of sales.)

Net interest expense for the quarter increased $30 million compared with second quarter 2005, primarily due to higher average debt balances, and to a lesser extent, due to a higher average portfolio rate.

Earnings before taxes (EBT) in the second quarter totaled $994 million, representing an increase of $125 million, or 14.5 percent, from the same period in 2005. The contribution from the company’s credit card operations to these results was $168 million, an increase of $58 million, or 52.7 percent, from a year ago.

—more —

Other Factors

The company’s effective income tax rate for the second quarter was 38.8 percent in 2006 compared with 37.9 percent in 2005. For the full year, the effective income tax rate is now expected to be between 38.3 and 38.8 percent.

The company has Board authorization to repurchase $5 billion of its common stock. Under this program, the company repurchased $550 million of its common stock during the second quarter of 2006, acquiring 11.3 million shares at an average price of $48.63 per share. Program to-date, the company has acquired 69.5 million shares of its common stock at an average price per share of $48.55, reflecting a total investment of approximately $3.37 billion. The company expects to continue to execute this program primarily in open market transactions, subject to market conditions, and expects to complete the total program by year-end 2008, or sooner.

Miscellaneous

Target Corporation will webcast its second 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 www.target.com/investors (click on “webcasts”). A telephone replay of the call will be available beginning at approximately 11:30am CDT today through the end of business on August 11, 2006. The replay number is (800) 642-1687 (passcode: 1291511).

Forward-looking statements in this release should be read in conjunction with the cautionary statements in Exhibit (99)C to the company’s 2005 Form 10-K.

Target Corporation’s operations include large, general merchandise discount stores and a fully integrated on-line business through which we offer a fun and convenient shopping experience with thousands of highly differentiated and affordably priced items. The company gives back more than $2 million each week to its local communities through grants and special programs. The company currently operates 1,444 Target stores in 47 states.

Target Corporation news releases are available at www.target.com.

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(Tables Follow)

2

CONSOLIDATED RESULTS OF OPERATIONS

	Thirteen Weeks Ended						Twenty-Six Weeks Ended
(Millions, except per share data)	July 29,		July 30,		%		July 29,		July 30,		%
(Unaudited)	2006		2005		Change		2006		2005		Change
Sales	$	12,959	$	11,667	11.1	%	$	25,453	$	22,838	11.4	%
Net credit card revenues	388		323		19.9		757		629		20.5
Total revenues	13,347		11,990		11.3		26,210		23,467		11.7
Cost of sales	8,686		7,828		11.0		17,159		15,384		11.5
Selling, general and administrative expenses	2,987		2,650		12.7		5,865		5,145		14.0
Credit card expenses	170		187		(9.5	)	330		366		(9.9	)
Depreciation and amortization	370		346		6.9		704		686		2.7
Earnings before interest expense and income taxes	1,134		979		15.9		2,152		1,886		14.1
Net interest expense	140		110		27.3		272		221		23.0
Earnings before income taxes	994		869		14.5		1,880		1,665		13.0
Provision for income taxes	385		329		17.1		718		631		13.7
Net earnings	$	609	$	540	12.9	%	$	1,162	$	1,034	12.5	%
Basic earnings per share:	$	0.71	$	0.61	15.8	%	$	1.34	$	1.17	15.0	%
Diluted earnings per share:	$	0.70	$	0.61	16.0	%	$	1.33	$	1.16	15.0	%
Weighted average common shares outstanding:
Basic	860.8		883.3				865.7		885.1
Diluted	867.2		891.2				872.4		892.4

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CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

SUBJECT TO RECLASSIFICATION
(Millions)	July 29,		July 30,
(Unaudited)	2006		2005
ASSETS
Cash and cash equivalents	$	477	$	696
Accounts receivable, net	5,540		5,012
Inventory	6,275		5,628
Other current assets	1,297		1,001
Total current assets	13,589		12,337
Property and equipment, net	20,257		18,023
Other non-current assets	1,577		1,559
Total assets	$	35,423	$	31,919
LIABILITIES AND SHAREHOLDERS’ INVESTMENT
Accounts payable	$	5,868	$	5,472
Current portion of long-term debt and notes payable	1,257		753
Other current liabilities	2,535		1,812
Total current liabilities	9,660		8,037
Long-term debt	9,351		8,226
Deferred income taxes	768		973
Other non-current liabilities	1,271		1,161
Shareholders’ investment	14,373		13,522
Total liabilities and shareholders’ investment	$	35,423	$	31,919
Common shares outstanding	857.8		884.7

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CONSOLIDATED STATEMENTS OF CASH FLOWS

SUBJECT TO RECLASSIFICATION	Twenty-Six Weeks Ended
(Millions)	July 29,			July 30,
(Unaudited)	2006			2005
OPERATING ACTIVITIES
Net earnings	$	1,162		$	1,034
Reconciliation to cash flow:
Depreciation and amortization	704			686
Stock based compensation expense	38			57
Deferred income taxes	(112		)	—
Bad debt provision	181			217
Loss on disposal of property and equipment, net	47			43
Other non-cash items affecting earnings	20			(33		)
Changes in operating accounts providing/(requiring) cash:
Accounts receivable originated at Target	17			17
Inventory	(437		)	(244		)
Other current assets	48			191
Other non-current assets	5			(8		)
Accounts payable	(400		)	(307		)
Accrued liabilities	64			73
Income taxes payable	(179		)	(286		)
Other	11			18
Cash flow provided by operations	1,169			1,458
INVESTING ACTIVITIES
Expenditures for property and equipment	(1,899		)	(1,774		)
Proceeds from disposal of property and equipment	15			13
Change in accounts receivable originated at third parties	(73		)	(177		)
Other	(111		)	—
Cash flow required by investing activities	(2,068		)	(1,938		)
FINANCING ACTIVITIES
Increase in notes payable, net	748			—
Additions to long-term debt	750			—
Reductions of long-term debt	(750		)	(513		)
Dividends paid	(174		)	(142		)
Repurchase of stock	(900		)	(533		)
Stock option exercises	50			120
Stock-based compensation tax benefit	8			—
Other	(4		)	(1		)
Cash flow required by financing activities	(272		)	(1,069		)
Net decrease in cash and cash equivalents	(1,171		)	(1,549		)
Cash and cash equivalents at beginning of period	1,648			2,245
Cash and cash equivalents at end of period	$	477		$	696

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(Unaudited)

NUMBER OF STORES, RETAIL SQUARE FEET and COMPARABLE-STORE SALES

Retail square feet in thousands; reflects total square feet less office, distribution center and vacant space.

	Number of Stores		Retail Square Feet
	July 29,	July 30,	July 29,	July 30,	%
	2006	2005	2006	2005	Change
Target General Merchandise Stores	1,282	1,210	156,036	146,096	6.8	%
SuperTarget Stores	162	141	28,641	24,936	14.9
Total	1,444	1,351	184,677	171,032	8.0	%

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	July 29,		July 30,		July 29,		July 30,
	2006		2005		2006		2005
Comparable-Store Sales	4.6	%	6.7	%	4.9	%	6.5	%

CREDIT CARD CONTRIBUTION TO EBT

	Thirteen Weeks Ended						Twenty-Six Weeks Ended
	July 29,			July 30,			July 29,			July 30,
(millions)	2006			2005			2006			2005
Revenues
Finance charges	$	273		$	219		$	532		$	424
Interest expense (a)	(68		)	(43		)	(131		)	(83		)
Net interest income	205			176			401			341
Late fees and other revenues	80			74			160			148
Merchant fees
Intracompany	18			17			33			32
Third-party	35			30			65			57
Non-interest income	133			121			258			237
Expenses
Bad debt	93			111			181			217
Operations and marketing	77			76			149			149
Total expenses	170			187			330			366
Credit card contribution to EBT	$	168		$	110		$	329		$	212
As a percent of average receivables (annualized)	11.3		%	8.2		%	11.1		%	7.9		%
Net interest margin (annualized) (b)	13.9		%	13.2		%	13.5		%	12.8		%
RECEIVABLES
Period-end receivables	$	6,041		$	5,421
Average receivables	$	5,936		$	5,328		$	5,945		$	5,336
Accounts with three or more payments past due as a percent of period-end receivables	3.4		%	3.0		%
ALLOWANCE FOR DOUBTFUL ACCOUNTS
Allowance at beginning of period	$	476		$	394		$	451		$	387
Bad debt provision	93			111			181			217
Net write-offs	(68		)	(96		)	(131		)	(195		)
Allowance at end of period	$	501		$	409		$	501		$	409
As a percent of period-end receivables	8.3		%	7.5		%	8.3		%	7.5		%
Net write-offs as a percent of average receivables (annualized)	4.6		%	7.2		%	4.4		%	7.3		%

(a)  Represents an allocation of consolidated interest expense based on estimated funding costs for average net accounts receivable and other financial services assets. Interest expense allocated to our credit card operations for the first, second, third, and fourth quarters 2005 totaled $40, $43, $50, and $59, respectively.

(b)  Net interest income divided by average accounts receivable.

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