Target still looking for movement in home
August 18, 2009,
Minneapolis – Home and other discretionary categories continue to struggle at Target, although the retailer believes its recent price-oriented marketing campaign is starting to shift customer perceptions of about the chain.
Earnings for the quarter ended Aug. 1 fell 6.3% to $549 million, 79 cents per share, although gross margin expanded by 70 basis points to 31.9% during the period.
With traffic and transactions down, sales fell 2.7% to $14.6 billion. A 6.2% decline in comps was partially offset by the contribution from new store expansion, the company said.
Still, Target beat Wall Street’s expectations. The company has begun to see an uptick in discretionary categories in the third quarter, said Doug Scovanner, evp and cfo. However, he cautioned, the quarter has just gotten underway and those results may not be predictive.
For the first half, profit declined 9.8% to $1.1 billion. Sales fell 1.2% to $28.9 billion.
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