Target Corp (TGT) has reported 10.75 percent rise in profit for the quarter ended Oct. 29, 2016. The company has earned $608 million, or $1.06 a share in the quarter, compared with $549 million, or $0.87 a share for the same period last year. On an adjusted basis, earnings per share were at $1.04 for the quarter compared with $0.86 in the same period last year. Revenue during the quarter dropped 6.65 percent to $16,441 million from $17,613 million in the previous year period. Gross margin for the quarter expanded 86 basis points over the previous year period to 30.23 percent. Total expenses were 93.55 percent of quarterly revenues, down from 95.03 percent for the same period last year. This has led to an improvement of 148 basis points in operating margin to 6.45 percent.
Operating income for the quarter was $1,061 million, compared with $876 million in the previous year period.
“We are very pleased with our third quarter financial results, which reflect meaningful improvement in our traffic and sales trends and much stronger-than-expected profitability,” said Brian Cornell, chairman and Chief executive officer of Target. “Favorable gross margin mix and efficient execution by our team drove third quarter EPS performance well beyond our guidance. We also continued to gain market share in key Signature Categories and saw unexpectedly strong sales in the Back-to-School and Back-to-College season. As we move into the biggest quarter of the year, we are pleased with our inventory position and confident that our team will deliver a great guest experience as they bring our merchandising and marketing plans to life throughout the holiday season.”
Operating cash flow declines
Target Corporation has generated cash of $2,881 million from operating activities during the nine month period, down 24.95 percent or $958 million, when compared with the last year period. The company has spent $1,138 million cash to meet investing activities during the nine month period as against cash outgo of $1,069 million in the last year period. It has incurred net capital expenditure of $1,161 million on net basis during the nine month period, up 4.78 percent or $53 million from year ago period.
The company has spent $4,558 million cash to carry out financing activities during the nine month period as against cash outgo of $3,003 million in the last year period.
Cash and cash equivalents stood at $1,231 million as on Oct. 29, 2016, down 37.73 percent or $746 million from $1,977 million on Oct. 31, 2015.
Working capital drops significantly
Target Corporation has witnessed a decline in the working capital over the last year. It stood at $200 million as at Oct. 29, 2016, down 85.14 percent or $1,146 million from $1,346 million on Oct. 31, 2015. Current ratio was at 1.02 as on Oct. 29, 2016, down from 1.10 on Oct. 31, 2015.
Days inventory outstanding has decreased to 40 days for the quarter compared with 68 days for the previous year period. At the same time, days payable outstanding went up to 60 days for the quarter from 58 for the same period last year.
Debt remains almost stable
Target Corporation has witnessed an increase in total debt over the last one year. It stood at $12,826 million as on Oct. 29, 2016, up 0.90 percent or $114 million from $12,712 million on Oct. 31, 2015. Total debt was 33.23 percent of total assets as on Oct. 29, 2016, compared with 30.49 percent on Oct. 31, 2015. Debt to equity ratio was at 1.16 as on Oct. 29, 2016, up from 0.96 as on Oct. 31, 2015. Interest coverage ratio improved to 7.47 for the quarter from 5.80 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
