MINNEAPOLIS — Target, riding high on a stellar first quarter, highlighted successes against rival Wal-Mart as chairman and chief executive officer Robert Ulrich said at its annual shareholders meeting Wednesday that the company has the potential to more than double the number of stores in the U.S. over the next decade.
Ulrich said during the session at the Minneapolis Art Institute, which lasted about 15 minutes, that he was bullish on growth prospects and possibly tripling sales volume by 2015. However, he sought to quash speculation about international expansion.
"We have a great deal of growth in our future and no interest in expanding overseas" in the near-term, he said.
The retailer plans to grow 8 to 10 percent annually from its existing 1,330 stores, with a goal of 2,000 stores by 2010. It may step up openings this year if consolidation from the Federated-May and Sears-Kmart mergers opens up prime real estate.
Chief financial officer Douglas Scovanner said that factoring in analyst consensus of $2.55 to $2.60 earnings per share this fiscal year, Target should end the year with a "somewhat higher P/E ratio than Wal-Mart for the first time in the 11 years I've been with the company."
Transactions were up 2 to 3 percent in stores open at least a year, another high point of the past decade, Scovanner said during a news conference after the meeting.
Wal-Mart has struggled with lagging same-store sales during the past 12 months, citing economic pressures on its customers. The retailer recently missed its quarterly earnings for the second time in its history. In contrast, Target exceeded earnings by 2 cents, posting a 14.4 percent rise in net income to $494 million, or 55 cents, from $432 million, or 47 cents, a year ago. Target shares closed at $52.02 Wednesday, while Wal-Mart shares were near a two-year low, closing at $47.58.
Regarding apparel, president Gregg Steinhafel said the company was "very pleased" with performance, but had no plans to increase floor space because "it's at a level that's appropriate for the revenues it delivers."
Isaac Mizrahi's home collection launch is exceeding expectations, he said. The retailer has also expanded junior apparel brand Mossimo into plus sizes.
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