Target on Wednesday saw a strong increase in profits and sales for the fourth quarter.
The discounter reported a 26 percent increase in net profits to $1.6 billion on a 4.1 percent rise in sales to $21.75 billion for the quarter ended Jan. 31. That compares with profits of $1.3 billion on sales of $20.89 billion a year earlier. Same-store sales rose 3.8 percent, reflecting a 3.2 percent increase in comparable transactions.
Earnings per share climbed 22 percent to $1.50 from $1.22, which was above Target’s recent guidance of $1.43 to $1.47. The Wall Street consensus estimate was $1.46 a share.
However, reflecting Target’s struggles earlier in the year, full-year EPS fell 2.6 percent to $4.27 from last year’s $4.38.
Target realized a pretax loss of $5 billion related to the discontinuation of its operations in Canada, which resulted in a $5.59 loss per share.
Brian Cornell, chairman and chief executive of Target, said the company saw better than expected sales and particularly strong performances in the signature categories it’s been focusing in, including style, baby, kids and wellness.
In the first quarter of 2015, Target expects earnings per share of 95 cents to $1.05 compared with the first quarter of 2014 when EPS was 92 cents.