Minneapolis - Target reported net earnings of $436 million for the third quarter, ended Oct. 31, higher than the prior year's third quarter.
Earnings increased 18.6 percent per share, compared with the prior year's $369 million in the third quarter of last year.
Sales increased 1.4 percent in the third quarter to $14.8 billion, from $14.6 billion in 2008, due to the contribution from new store expansion, but was partially offset by a 1.6 percent decline in comp-store sales. Retail segment earnings before interest expense and income taxes (EBIT) were $791 million in the third quarter of 2009, a 2.4 percent increase from $772 million in 2008.
Gregg Steinhafel, chairman, president and CEO of Target, said in a prepared statement, "Profitability in our retail segment during the third quarter was well above expectations, and credit card segment profitability also improved due to continued thoughtful portfolio management in a challenging credit environment. As we look ahead, we remain keenly focused on delighting our guests with exciting merchandise, exceptional prices and superior service during the holiday season and believe we are well-positioned to capture profitable market share."
Average credit card receivables in the quarter decreased $547 million, or 6.3 percent, from the third quarter of 2008, and quarter-end receivables decreased $717 million, or 8.2 percent, from the same period a year ago.
Credit card segment profit in the quarter increased to $60 million, from $35 million last year, as a result of improved portfolio performance that more than offset the impact of lower floating interest rates.
Target said in light of the current and projected economic environment and expectations for a highly promotional holiday season, it remains cautious about fourth-quarter performance and is planning conservatively in both business segments.