Target Sept. Sales Up; Co. to End Monthly Reporting
Target Corporation’s sales rose in September but narrowly missed analyst expectations—and the retail giant said Thursday that it plans to stop reporting monthly sales results in its 2013 fiscal year.
Same-store sales—sales at stores open for at least a year and a key measure of a retailer’s health—jumped 2.1 percent last month. Analysts polled by Thomson Reuters expected a 2.2 percent increase.
In a monthly sales recording, Target said that September same-store sales were strongest in food, which experienced a “high single-digit” increase, and beauty products, which experienced a “mid-single-digit” jump. Additionally, same-store sales rose in every region of the country but were strongest in portions of the west and south.
Target Chairman, President, and CEO Gregg Steinhafel said in a statement that September same-store sales “were in line with our guidance for the month.”
Meanwhile, net retail sales for the five weeks that ended on September 29 totaled $6.1 billion, up 2.6 percent from the same period last year.
Unlike many large public companies, Target has long released monthly sales figures in addition to quarterly and annual results—and those figures have helped to illustrate larger trends in consumer spending and retail health. But beginning with its 2013 fiscal year, which kicks off in late January, Target plans to stop reporting monthly sales.
“This decision is based on discussions with many of our investors and is consistent with the practice of the vast majority of our retail peers,” John Mulligan, Target’s executive vice president and chief financial officer, said in a statement. “We believe aligning our sales guidance and reporting with disclosure of our quarterly financial results will create a longer-term focus and provide greater understanding of our sales results in the context of our overall financial performance.”
The decision to suspend such reports follows similar decisions that some other major retailers have made in recent years—including Wal-Mart Stores, Inc., Saks, Inc., and J.C. Penney Company. Retailers that do still release monthly financial results include Gap, Inc., Kohl’s Corporation, and Macy’s. Inc.
Year-to-date, Target’s overall sales are up 4.5 percent and total $44.6 billion—and same-store sales are up 3.9 percent.
Target has already begun ramping up its efforts to attract holiday shoppers. Starting October 14, the retailer will feature 20 toys at the front of its aisles that are promoted with signs featuring QR codes (squares with dark boxes and lines). Customers can scan the codes with their smartphones to buy any of the items and have them shipped for free. Additionally, Target is launching what it’s calling “an interactive toy catalog with an enhanced digital wish list” and plans to prominently display the season’s most popular toys.
Target shares were trading up about 0.8 percent at $63.61 mid-morning Thursday on news of the September sales results.
Target is Minnesota’s second-largest public company based on revenue, which totaled $68.5 billion in its fiscal year that ended in January. It operates 1,772 stores in the United States and plans to expand into Canada next year.