MINNEAPOLIS–Target ended its fiscal year on a supremely positive note, with an 11 percent booster to its bottom line for the fourth quarter and a 17 percent jump in net profit for the year.
The mass-merchant retailer posted $1 billion in net income for the quarter, which ended on Jan. 29. Net sales rose 2.8 percent to $20.3 billion—including a 2.4 percent gain in same-store sales—and gross margin actually declined by 69 basis points to 30 percent. However, selling, general and administrative expenses increased by just 3.4 percent in dollars and fell 20 basis points as a percentage of sales. Also, credit-card expenses dropped by 55 percent and net interest expense fell by 11 percent.
For the fiscal year, the bottom line totaled $2.9 billion and net sales picked up 3.7 percent to $65.8 billion, including a 2.1 percent increase in same store sales. The net-income figures for both the quarter and the year were new records for Target.
Expressing his delight over these results, Gregg Steinhafel, chairman, president and chief executive officer, said Target will continue its store-remodeling program in 2011, continue its five percent REDcard Rewards initiative and launch its new Target.com platform. Steinhafel also looked ahead to 2012, when the first CityTarget stores are slated to open, and to 2013 and 2014, when the first stores in Canada are scheduled to open.