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TARGET CORP Annual Report, Year Ended Feb 3, 2001

Filing Date
Filed April 16, 2001
Period End
February 3, 2001
Security
TGT
In the record · 2016–202610-K1110-Q328-K125

TGT filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 125 current reports (8-K) between 2016 and 2026.

  1. FY2017 annual report10-K · Mar ’17Mar ’17
  2. Leadership change8-K · Oct ’19Oct ’19
  3. Material agreement8-K · Oct ’21Oct ’21
  4. Material agreement8-K · Oct ’25Oct ’25

01—Abstract

Summary

Summary of the 10-K filed April 16, 2001. Cited figures are marked; the original filing is the authoritative source.

Target Corporation (TGT) reported a strong fiscal 2000, a 53-week year ended February 3, 2001.

Total revenues rose 9.5% to $36.9 billiona, and net earnings reached $1.264 billion, or $1.38 per diluted share, up from $1.23 in 1999. Growth was driven by Target, which generated 80% of revenues and $2.22 billion of pre-tax segment profit, up 10%. Mervyn's profit rose 31%, while Marshall Field's declined 36% on weaker sales.

Consolidated 52-week comparable-store sales grew 2.4%, with Target's comparable sales up 3.4%. The balance sheet remained solid. Operating cash flow was $1.9 billion, and capital expenditures rose to $2.5 billionb, funding 79 new stores and a net addition of 65 for the year.

Long-term debt increased to $5.6 billionc, and the retail debt ratio rose to 44% from 40%. Management reported the company's debt ratings were upgraded by Moody's and S&P. The company repurchased $591 million of stock in 2000 and continues to return capital through dividends, which were $0.21 per share.

For fiscal 2001, management guided to strong revenue and earnings growth, with about 70 net new stores, retail square footage growth of 10-11%, and a planned $3.3d-3.5 billion in capital investment. This includes roughly $700 million for acquiring and renovating 35 former Montgomery Ward locations.

Gross margin and expense rates are expected to be roughly flat, and the effective tax rate is expected near 38%. Key risks flagged include intensifying competition, shifting consumer demand, changes in consumer credit markets, and the performance of the Marshall Field's turnaround.

02—Key points

Key Highlights

  1. Net earnings of $1.264 billion ($1.38 diluted EPS) in fiscal 2000, up from $1.23 in 1999, with total revenues up 9.5% to $36.9 billion
  2. Target division drove growth: revenues up 12.3%, pre-tax segment profit up 10% to $2.22 billion, and 3.4% comparable-store sales growth
  3. Marshall Field's weakened sharply, with pre-tax profit down 36% and comparable-store sales down 4.0%, while Mervyn's profit rose 31%
  4. Capital expenditures increased to $2.5 billion (from $1.9 billion), with 79 stores opened and 14 closed or relocated in 2000
  5. Credit operations grew: average receivables serviced rose 8% to $2.6 billion, and the Target Guest Card base exceeded 18 million accounts
  6. Shareholder returns: $591 million in stock repurchases and $0.21 per share in dividends; long-term debt rose to $5.6 billion and the retail debt ratio to 44%
  7. 2001 outlook calls for strong revenue and earnings growth, around 70 net new stores, and a $3.3-3.5 billion investment program including Montgomery Ward locations

03—Questions

Frequently Asked Questions

  1. How did Target Corporation perform financially in fiscal 2000?

    Target delivered net earnings of $1.264 billion, or $1.38 per diluted share, up from $1.23 in 1999. Total revenues increased 9.5% to $36.9 billion. Fiscal 2000 was a 53-week year, which contributed to the revenue growth. Consolidated comparable-store sales rose 2.4%.

  2. Which business segment is driving Target's growth?

    The Target discount division is the primary growth driver. It generated 80% of total revenues, with revenues up 12.3% and pre-tax segment profit up 10% to $2.22 billion. Mervyn's also improved, with profit up 31%. Marshall Field's was the weak spot, with profit down 36% and revenues down 2.1%.

  3. How is Target spending its cash and returning capital to shareholders?

    Target spent $2.5 billion on capital expenditures in 2000, mainly on new stores and remodels. It repurchased $591 million of common stock and paid $190 million in dividends. Its board authorized an additional $1 billion repurchase in March 2000. Long-term debt rose to $5.6 billion, and the retail debt ratio increased to 44%, though the company maintains strong investment-grade ratings.

  4. What is the outlook for fiscal 2001?

    Management expects strong growth in revenues and earnings, driven by Target comparable-store sales and new stores, continued modest improvement at Mervyn's, and a significant profit recovery at Marshall Field's. Gross margin and expense rates are expected to be roughly flat. The company plans to open about 90 stores, for a net addition of about 70, and expects a tax rate near 38%.

  5. What are the main risks investors should consider?

    The filing cites intensifying competition from discount, department, off-price, and online retailers; difficulty predicting consumer trends; changes in credit card regulation, usage, or default rates; and sensitivity to economic conditions such as interest rates and consumer confidence. It also highlights sourcing risks from international vendors and the underperformance of Marshall Field's, which will require a turnaround to meet 2001 expectations.

04—Continue

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