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Target 3Q Earnings Rise 50 Percent

November 14, 2002

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MINNEAPOLIS (AP) _ Target Corp., fueled by a robust performance at its namesake discount store division, reported a 50 percent jump in third-quarter earnings Thursday, beating Wall Street expectations.

The company, which operates Target, Mervyn’s and Marshall Field’s, said net income for the quarter ended Nov. 3 was $277 million, or 30 cents per share, compared with $185 million, or 20 cents per share, in the year-ago period.

Last year’s third quarter included a pretax charge of $67 million, or 5 cents per share, because the company restored securitized accounts receivable to its financial statements.

This year’s results were 2 cents better than the consensus estimate of analysts surveyed by Thompson First Call.

Shares rose 11.5 percent, or $3.46 each, to close Thursday at $33.49 on the New York Stock Exchange.

Total revenues in the third quarter increased 9 percent to $10.19 billion from $9.33 billion in 2001, driven by an 11.8 percent revenue increase at Target Stores.

But overall same-store sales _ sales from stores opened at least one year _ increased just 0.1 percent. Same-store sales are considered the best gauge of a retailer’s health.

Bob Ulrich, chairman and chief executive officer, said Target was pleased with the results, ``especially given our relatively soft sales performance during the quarter.″

``For the fourth quarter, our outlook for earnings growth is modest in light of last year’s strong performance.″ Ulrich said. ``Importantly, we expect to deliver strong earnings growth for 2002 overall, and we remain confident that we will continue to generate average annual earnings per share growth of 15 percent or more over time.″

Year-to-date earnings were $966 million, or $1.06 per share, up 36 percent from $710 million, or 78 cents per share, in the same period a year ago. Revenues for the first three quarters were $29.86 billion, up 12 percent from $26.61 billion a year ago.

Target Corp. operates 1,476 stores in 47 states, including 1,148 Target discount stores, 264 Mervyn’s stores and 64 Marshall Field’s stores.

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On the Net:

Target Corp. http://www.target.com

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