For the first quarter ended May 4, Target Corp. posted net earnings of $498 million, or 77 cents per diluted share, versus $697 million, or $1.04 per diluted share, in the period a year ago. Comparable store sales declined by 0.6% with average transaction amount up 1.3% and units per transaction up 1.8% but number of transactions down 1.9% and selling price per unit down 0.6%.
Total sales were $16.7 billion, up 1% from last year’s first quarter.
In the United States, Target sales increased 0.5% to $16.6 billion, a figure that represented the 0.6% comp decline buoyed by the contribution from new stores. U.S. division EBIT was $1.24 billion, a decline of 7.5% from the 2012 first quarter.
Target pointed out that its first 24 Canadian stores opened in March 2013. They generated sales of $86 million in the first quarter but posted a negative EBIT of $205 million, Target related. The retailer asserted that Canadian operations reduced its first quarter GAAP earnings per share by 24 cents.
So, adjusted diluted earnings per share were $1.05 in first quarter, down 5% from $1.11 in the prior-year period, Target maintained.
Although sales fell just short of a Thomson Reuter’s consensus analyst, earnings per share beat Wall Street by 18 cents.
Still, in the last measure, Target acknowledged that the first quarter was difficult for it.
“Target’s first quarter earnings were below expectations as a result of softer-than-expected sales, particularly in apparel and other seasonal and weather-sensitive categories,” Gregg Steinhafel, Target chairman, president, and CEO, said. “While we are disappointed in our first quarter performance, we remain confident in our strategy, and we continue to invest in initiatives including Canada, our digital channels and CityTarget, that will drive Target’s long-term growth.”
Target now operates 1,832 stores, with 1,784 in the United States and 48 in Canada, as well as Target.com, according to the company.