Target Corp. on Tuesday updated its second-quarter guidance, saying it expects to record $148 million in breach-related expenses.
The charge will be offset by $38 million in an insurance receivable. Target suffered a data breach in December.
The company also said it completed tender offers during the second quarter in which the company paid $1 billion to retire, at market value, $725 million of its long-term debt. It incurred a pretax loss of $285 million, or 27 cents a share, which will be recognized as net interest expense in the second quarter.
For now, the company expects second-quarter adjusted earnings per share of about 78 cents, compared with earlier guidance of 85 cents to $1 a share.
Sterne Agee’s Charles Grom said the adjusted EPS guidance reflects “flat” U.S. comp sales, with “lower-than-expected” earnings before interest, taxes, depreciation and amortization margins driven by promotional markdowns and “somewhat softer-than-expected sales/continued investments to clear excess inventory” in Canada. He also noted that the expenses to be charged in connection with the data breach include an “increase to the accrual for estimated probable losses for a vast majority of the claims, including claims by payment card networks.”
The company will report the quarter’s results on Aug. 20, the same day in which executives will also update expectations for the balance of fiscal 2014 during a conference call to Wall Street analysts.
Shares of Target fell 4.4 percent to close at $58.03 in trading on the New York Stock Exchange.
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion (📷: Dominique Maître)
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
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For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)