MINNEAPOLIS–A gain in sales helped propel Target to a 3.7 percent increase in net income in the third quarter, to $555 million.
The bottom-line result included a $35 million operating loss from the company’s recently formed Canadian segment, reflecting expenses related to Target’s entry into that market, which is planned for 2013.
Net sales increased 5.4 percent to $16.1 billion, including a 4.3 percent rise in same-store sales and sales contributions from new stores. Gross margin fell 18 basis points to 30.5 percent, reflecting the impact of Target’s growth strategies. Selling, general and administrative expenses rose 5.4 percent in dollars but were flat as a percentage of sales, at 22 percent.
Gregg Steinhafel, Target’s chairman, president and CEO, said the third-quarter results show that Target has “the right strategy and team in place to drive continued strong performance this holiday season and well into the future.”