Exhibit 99
[TARGET CORPORATION LOGO]
INVESTOR RELATIONS NEWS
FOR IMMEDIATE RELEASE Contact: Susan Kahn
(612) 370-6735
TARGET CORPORATION FOURTH QUARTER
EARNINGS PER SHARE $0.61; FISCAL 2000 EARNINGS PER SHARE $1.38
COMPANY ACQUIRES RIGHTS TO 35 FORMER WARDS STORES
MINNEAPOLIS, MARCH 6, 2001 -- Target Corporation today reported
earnings per share for the fourth quarter ended Feb. 3, 2001 of 61 cents,
compared with 56 cents before unusual items in fourth quarter 1999. On the same
basis, fourth-quarter net earnings increased 5.9 percent to $552 million,
compared with $522 million in 1999. All earnings per share figures refer to
diluted earnings per share.
For the full year, diluted earnings per share were $1.38, an increase
of 9.2 percent compared with $1.27 before unusual items in 1999. Net earnings
were $1.264 billion, up 6.7 percent compared with $1.185 billion before unusual
items in 1999. Including unusual items for 1999, 2000 earnings per share grew
13.1 percent and net earnings rose 10.5 percent. Unusual items in the prior year
were principally related to the early extinguishment of debt.
"We are satisfied with our fourth quarter and total year 2000
results in light of the current economic environment," said Bob Ulrich, chairman
and chief executive officer of Target Corporation. "In 2001, we will continue to
manage our business with a disciplined approach and, over the long-term, we
remain confident in our ability to achieve average annual earnings per share
growth of 15 percent."
Separately, Target Corporation also announced that it has agreed to
acquire the rights to 35 former Wards stores. Following extensive remodeling
efforts, the company plans to open 30 or more of these locations in 2002 as new
Target stores.
"The acquisition of these former Wards stores was an excellent
opportunity for Target to purchase sites in a number of premier markets,
including California, where prime real estate is particularly difficult to
find," Ulrich said.
--more --
FULL-YEAR RESULTS
For fiscal 2000, a 53-week year, total revenues increased 9.5 percent
to $36.903 billion from $33.702 billion in 1999, a 52-week period. In addition
to the extra week, revenue growth in 2000 reflected 52-week comparable store
sales growth of 2.4 percent and contribution from Target's new store expansion.
(Total revenues include retail sales and net credit revenues. Comparable-store
sales are sales from stores open longer than one year.)
The company's full-year gross margin rate decreased primarily due to
the mix impact of growth at Target, our lowest margin rate division. (Gross
margin rate represents gross margin as a percentage of sales.)
The full-year operating expense rate was essentially even with the
prior year, benefiting from overall growth at Target, our lowest expense rate
division, offset by lack of sales leverage at both Mervyn's and Marshall
Field's. (Operating expense rate represents selling, general and administrative
expense, including buying and occupancy, advertising, start-up and other
expense, as a percentage of revenues.)
For the year, pre-tax segment profit increased 6.3 percent to $2.682
billion, compared with $2.523 billion in 1999. Target's pre-tax profit increased
10.0 percent; Mervyn's pre-tax profit grew 31.1 percent; and Marshall Field's
pre-tax profit declined 36.0 percent. (Pre-tax segment profit is earnings before
LIFO, securitization effects, interest, other expense and unusual items.)
FOURTH-QUARTER RESULTS
Reflecting a 14-week vs. 13-week comparison, fourth-quarter revenues
increased 12.8 percent to $12.324 billion from $10.930 billion in the same
period last year. Thirteen-week comparable-store sales for fourth quarter 2000
increased 1.8 percent.
Both the gross margin rate and the operating expense rate in the
quarter were unfavorable to the prior year period.
Fourth-quarter 2000 pre-tax segment profit increased 7.9 percent to
$1.079 billion, compared with $1.000 billion in the fourth quarter of 1999.
OTHER FACTORS
Fourth-quarter and full-year gross margin results include a pre-tax
LIFO charge of $4 million in 2000, compared with a $7 million credit in the same
periods in 1999. On a year-over-year basis, LIFO was unfavorable to full-year
earnings per share by $.01.
--more --
TARGET CORPORATION
PAGE 3
Net interest expense and interest equivalent for the quarter increased
$22 million compared with fourth quarter 1999 due to higher average funded
balances and the impact of the 14th week, partially offset by a lower average
portfolio interest rate. For the full year, net interest expense and interest
equivalent increased $33 million due to higher average funded balances and the
impact of the 53rd week, partially offset by a lower average portfolio interest
rate.
For the full year, credit revenue and profitability grew essentially in
line with growth in accounts receivable serviced. The contribution from credit
in 2000 increased 8.1 percent to $400 million from $370 million in 1999, on
year-end serviced receivables of $2.91 billion and $2.68 billion, respectively.
The company's annual effective income tax rate was 38.4 percent,
compared with 38.8 percent last year.
During the quarter, the company repurchased $18 million of its common
stock, acquiring 0.8 million shares at an average price of $23.21 per share. For
the year, the company repurchased 21.2 million shares at an average price of
$27.92, investing $591 million in its common stock. Since the inception of its
share repurchase program, the company has repurchased a total of 40.0 million
shares at an average price of $29.50 per share, representing a total investment
of $1.18 billion.
MISCELLANEOUS
Target Corporation will webcast its fourth quarter earnings conference
call at 9:30am CST today. Investors and the media are invited to listen to the
call through the company's website at 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 CST today through the
end of business on March 7, 2001. The replay number is (800) 633-8284 and the
passcode is 17960665.
Forward-looking statements in this release should be read in
conjunction with the cautionary statements in Exhibit (99)C to the company's
1999 Form 10-K.
In a separate announcement issued this morning, Target Corporation also
released its sales results for the month of February.
Target Corporation operates large-store general merchandise formats,
including discount stores, moderate-priced promotional and traditional
department stores, as well as a direct mail and on-line business called
target.direct. At year-end, the company operated 1,307 stores in 46 states. This
included 977 Target stores, 266 Mervyn's stores and 64 Marshall Field's stores.
Target Corporation news releases are available at www.target.com or
www.prnewswire.com, or by fax, through Company News on Call at 800-758-5804
extension 342677.
###
(Tables Follow)
[TARGET CORPORATION LOGO]
CONSOLIDATED RESULTS OF OPERATIONS
(Unaudited)
Three Months Ended Year Ended
------------------------------------------------------------------------
(Millions, except per share data) FEBRUARY 3, January 29, % FEBRUARY 3, January 29, %
2001 2000 Change 2001 2000 Change
---------- ---------- ------ ---------- ---------- ------
Sales $ 12,182 $ 10,804 12.8% $ 36,362 $ 33,212 9.5%
Net credit revenues 142 126 13.1 541 490 10.4
---------- ---------- ------ ---------- ---------- ------
Total revenues 12,324 10,930 12.8 36,903 33,702 9.5
Cost of sales 8,639 7,620 13.4 25,295 23,029 9.8
Selling, general and administrative expense 2,422 2,135 13.4 8,190 7,490 9.3
Depreciation and amortization 247 223 10.6 940 854 10.1
Interest expense 121 99 22.6 425 393 8.2
---------- ---------- ------ ---------- ---------- ------
Earnings before income taxes and extraordinary 895 853 5.1 2,053 1,936 6.1
charges
Provision for income taxes 343 331 3.8 789 751 5.1
---------- ---------- ------ ---------- ---------- ------
Net earnings before extraordinary charges 552 522 5.9 1,264 1,185 6.7
Extraordinary charges from debt
extinguishment, net of tax - 28 - 41
---------- ---------- ------ ---------- ---------- ------
NET EARNINGS $ 552 $ 494 11.8% $ 1,264 $ 1,144 10.5%
========== ========== ====== ========== ========== ======
Earnings before extraordinary charges $0.62 $0.58 5.2% $1.40 $1.32 5.8%
Extraordinary charges - (0.03) - (0.04)
---------- ---------- ------ ---------- ---------- ------
BASIC EARNINGS PER SHARE $0.62 $0.55 11.2% $1.40 $1.28 9.6%
---------- ---------- ------ ---------- ---------- ------
Earnings before extraordinary charges $0.61 $0.56 8.2% $1.38 $1.27 9.2%
Extraordinary charges - (0.03) - (0.04)
---------- ---------- ------ ---------- ---------- ------
DILUTED EARNINGS PER SHARE $0.61 $0.53 14.3% $1.38 $1.23 13.1%
========== ========== ====== ========== ========== ======
Weighted average common shares outstanding:
Basic 896.5 884.9 903.5 882.6
Diluted 907.8 926.1 913.0 931.3
[TARGET CORPORATION LOGO]
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Millions) FEBRUARY 3, January 29,
2001 2000
---------- ----------
ASSETS
Cash and cash equivalents $ 356 $ 220
Receivable-backed securities 1,941 1,724
Inventory 4,248 3,798
Other 759 741
---------- ----------
TOTAL CURRENT ASSETS 7,304 6,483
---------- ----------
Property and equipment, net 11,418 9,899
Other 768 761
---------- ----------
TOTAL ASSETS $ 19,490 $ 17,143
========== ==========
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Accounts payable $ 3,576 $ 3,514
Current portion of long-term debt and notes payable 857 498
Other 1,868 1,838
---------- ----------
TOTAL CURRENT LIABILITIES 6,301 5,850
---------- ----------
Long-term debt 5,634 4,521
Other 1,036 910
Shareholders' investment 6,519 5,862
---------- ----------
TOTAL LIABILITIES AND SHAREHOLDERS' INVESTMENT $ 19,490 $ 17,143
========== ==========
Common shares outstanding 897.8 911.7
TARGET CORPORATION
(Millions)
REVENUES
(Unaudited)
Three Months Ended Year Ended
---------------------------------------------------- ----------------------------------------------------
FEBRUARY 3, January 29, % Change FEBRUARY 3, January 29, % Change
2001 2000 14 weeks 13 weeks 2001 2000 53 weeks 52 weeks
------------ ----------- ------------------------ ----------- ----------- -----------------------
Target $ 9,901 $ 8,563 15.6 % 10.2 % $ 29,278 $ 26,080 12.3 % 10.5 %
Mervyn's 1,316 1,273 3.4 (0.2) 4,152 4,099 1.3 0.2
Marshall Field's 944 935 0.9 (3.1) 3,011 3,074 (2.1) (3.3)
Other 163 159 2.4 (1.7) 462 449 3.0 1.5
------------ ----------- ---------- ---------- ----------- ----------- --------- ----------
TOTAL $ 12,324 $ 10,930 12.8 % 7.7 % $ 36,903 $ 33,702 9.5 % 7.9 %
============ =========== ========== ========== =========== =========== ========= ==========
COMPARABLE-STORE SALES
Comparable-store sales are sales from stores open longer than one year. The
calculations exclude the 14th and 53rd week.
% Change % Change
Three Months Ended Year Ended
February 3, 2001 February 3, 2001
-------------------- --------------------
Target 2.7 % 3.4 %
Mervyn's (0.3) 0.3
Marshall Field's (3.4) (4.0)
-------------------- --------------------
TOTAL 1.8 % 2.4 %
==================== ====================
INVENTORY
FEBRUARY 3, January 29, %
2001 2000 Change
-------------------- -------------------- --------
Target $ 3,090 $ 2,739 12.9 %
Mervyn's 561 501 11.9
Marshall Field's 396 438 (9.5)
Other 201 120 67.1
-------------------- -------------------- --------
TOTAL $ 4,248 $ 3,798 11.9 %
==================== ==================== ========
TARGET CORPORATION
(Millions)
PRE-TAX SEGMENT PROFIT AND EARNINGS RECONCILIATION
Pre-tax segment profit is earnings before LIFO, securitization effects,
interest, other expense and unusual items.
(Unaudited)
Three Months Ended Year Ended
----------------------------------- -------------------------------------
FEBRUARY 3, January 29, % FEBRUARY 3, January 29, %
2001 2000 Change 2001 2000 Change
----------- ----------- ------- ----------- ----------- -------
Target $ 892 $ 811 10.0 % $ 2,223 $ 2,022 10.0 %
Mervyn's 108 69 57.7 269 205 31.1
Marshall Field's 79 120 (34.4) 190 296 (36.0)
----------- ----------- ------- ----------- ----------- -------
Total pre-tax segment profit 1,079 1,000 7.9 2,682 2,523 6.3
LIFO (provision) credit (4) 7 (4) 7
Securitization adjustment (interest equivalent) (13) (13) (50) (49)
Interest expense (121) (99) (425) (393)
Mainframe outsourcing - - - (5)
Other (46) (42) (150) (147)
----------- ----------- ------- ----------- ----------- -------
Earnings before income taxes
and extraordinary items $ 895 $ 853 5.1 % $ 2,053 $ 1,936 6.1 %
=========== =========== ======= =========== =========== =======
EBITDA
(Unaudited)
EBITDA is pre-tax segment profit before depreciation and amortization.
Three Months Ended Year Ended
----------------------------------- -------------------------------------
FEBRUARY 3, January 29, % FEBRUARY 3, January 29, %
2001 2000 Change 2001 2000 Change
----------- ----------- ------- ----------- ----------- -------
Target $ 1,069 $ 961 11.2 % $ 2,883 $ 2,589 11.4 %
Mervyn's 141 103 36.9 400 343 16.3
Marshall Field's 112 153 (27.0) 323 429 (24.7)
----------- ----------- ------- ----------- ----------- -------
TOTAL $ 1,322 $ 1,217 8.6 % $ 3,606 $ 3,361 7.3 %
=========== =========== ======= =========== =========== =======
Three Months Ended Year Ended
------------------------ --------------------------
FEBRUARY 3, January 29, FEBRUARY 3, January 29,
2001 2000 2001 2000
----------- ----------- ----------- -----------
PRE-TAX SEGMENT PROFIT AS A % OF REVENUES:
Target 9.0% 9.5% 7.6% 7.8%
Mervyn's 8.2% 5.4% 6.5% 5.0%
Marshall Field's 8.3% 12.8% 6.3% 9.6%
EBITDA AS A % OF REVENUES:
Target 10.8% 11.2% 9.8% 9.9%
Mervyn's 10.7% 8.1% 9.6% 8.4%
Marshall Field's 11.9% 16.4% 10.7% 14.0%
NUMBER OF STORES AND RETAIL SQUARE FEET
(Unaudited)
Number of Stores Retail Square Feet
--------------------------- ------------------------
FEBRUARY 3, January 29, FEBRUARY 3, January 29,
2001 2000 2001 2000
----------- ----------- ----------- -----------
Target 977 912 112,604 102,945
Mervyn's 266 267 21,555 21,635
Marshall Field's 64 64 14,174 14,060
----------- ----------- ----------- -----------
TOTAL 1,307 1,243 148,333 138,640
=========== =========== =========== ===========
Retail square feet in thousands; reflects total square feet less office,
warehouse and vacant space.