Target’s omnichannel strategies seem to be paying off, as the retailer enjoyed a strong fourth quarter and its best fiscal year in more than a decade.
The company posted net earnings from continuing operations of $798 million, or $1.52 per diluted share, versus $1.09 billion, or $1.99 per diluted share, in the year-prior period.
Results for the fourth quarter and the full year reflected Target’s adoption of new revenue recognition, lease and pension accounting standards beginning in the 2018 first quarter, as well as a fiscal calendar shift, as the fourth quarter and full-year 2017 each included an extra week that contributed $1.17 billion in sales.
Adjusted earnings per share for the quarter were $1.53 versus $1.36 in the period a year past. Target’s adjusted earnings per share matched a Zacks Investment Research analyst consensus estimate.
Comparable sales grew by 5.3% in the quarter year over year as traffic growth advanced 4.5%. Comparable store sales increased 2.9% and comparable digital sales gained 31% from the year-earlier period. Net sales were $22.73 billion, flat to the year-previous quarter.
For the full fiscal year, Target posted net earnings from continuing operations of $2.93 billion, or $5.50 per diluted share, versus $2.91 billion, or $5.29 per diluted share, in the year prior. Adjusted earnings per share were $5.39 versus $4.69 in the year past.
Comparable sales grew by 5% in the fiscal year as traffic growth advanced 5%. Comparable store sales increased 3.2% and comparable digital sales gained 36% from the year-earlier. Net sales were $74.43 billion, versus $71.79 billion in the year previous.
“We’re very pleased with our fourth quarter performance, which capped off an outstanding year for Target,” said Brian Cornell, the company’s chairman and CEO. “Thanks to the dedication of Target’s team, we delivered our strongest traffic and comparable sales growth in well over a decade, and our 2018 adjusted EPS set a new all-time record for the company. We have been driving an ambitious agenda to transform our company, evolve with our guests and drive strong growth. On every count we’ve been successful, and as we enter 2019, we will continue to lead the industry by adapting, innovating and delivering more for our guests and shareholders.”