Adjusted EPS increased 20.6 percent from
last year; Comparable sales rose 2.4 percent
- Second quarter Adjusted EPS of $1.22
was above the company’s expected range of $1.04 to $1.14. The
Company now expects full-year 2015 Adjusted EPS of $4.60 to $4.75,
compared with prior guidance of $4.50 to $4.65.
- Second quarter comparable sales growth
of 2.4 percent was in line with the company’s expectations, driven
primarily by growth in comparable transactions.
- Comparable sales in signature
categories (Style, Baby, Kids and Wellness) grew three times faster
than the company average, resulting in comparable sales growth of
four to five percent in both Home and Apparel.
- Digital channel sales increased 30
percent, contributing 0.6 percentage points to comparable sales
growth.
- Target returned $1.0 billion to
shareholders in the second quarter through dividends and share
repurchases.
Target Corporation (NYSE: TGT) today reported second quarter
2015 adjusted earnings per share from continuing operations1
(Adjusted EPS) of $1.22, up 20.6 percent from $1.01 in 2014. GAAP
EPS from continuing operations were $1.21, compared with $0.61 in
second quarter 2014. The tables attached to this press release
provide a reconciliation of non-GAAP to GAAP measures. All earnings
per share figures refer to diluted EPS.
1Adjusted EPS, a non-GAAP financial
measure, excludes restructuring charges and the impact of certain
matters not related to the Company’s single segment, such as
discontinued operations, data breach expenses and certain other
expenses that are discretely managed. See the “Discontinued
Operations Update” and “Miscellaneous” sections of this release for
additional information about the items that have been excluded from
Adjusted EPS.
“We’re very pleased with our second quarter financial results,
as traffic growth, strong sales in our signature categories and
continued expense discipline drove better-than-expected
profitability,” said Brian Cornell, chairman and CEO of Target.
“While the momentum in our financial results is encouraging, we
have much more to accomplish. Looking ahead, we are focused on
making further progress against our strategic priorities and are
committed to improving operations as we move through the important
back-to-school, back-to-college and holiday seasons.”
Fiscal 2015 Earnings Guidance
In third quarter 2015, Target expects Adjusted EPS of $0.79 to
$0.89 compared with $0.79 in third quarter 2014.
The Company now expects full-year 2015 Adjusted EPS of $4.60 to
$4.75, compared with prior guidance of $4.50 to $4.65.
Segment Results
Second quarter 2015 sales increased 2.8 percent to $17.4 billion
from $17.0 billion last year, reflecting a 2.4 percent increase in
comparable sales combined with sales from new stores. Digital
channel sales grew 30 percent and contributed 0.6 percentage points
to comparable sales growth. Segment earnings before interest
expense and income taxes (EBIT) were $1,350 million in second
quarter 2015, an increase of 17.5 percent from $1,149 million in
2014.
Second quarter EBITDA and EBIT margin rates were 10.9 percent
and 7.7 percent, respectively, compared with 9.9 percent and 6.8
percent in 2014. Second quarter gross margin rate was 30.9 percent,
compared with 30.4 percent in 2014, reflecting the benefit of
annualizing heightened promotional markdowns in second quarter
2014, and a favorable merchandise mix in second quarter 2015.
Second quarter SG&A expense rate was 19.9 percent in 2015,
compared with 20.5 percent in 2014, reflecting ongoing cost savings
initiatives and expense timing.
Interest Expense and Taxes from Continuing Operations
The Company’s second quarter 2015 net interest expense was $148
million, compared with $433 million last year. Last year’s interest
expense included a $285 million charge related to the early
retirement of debt. Second quarter 2015 effective income tax rate
from continuing operations was 34.6 percent, compared with 33.7
percent last year, driven primarily by the impact on the
consolidated tax rate from higher pretax earnings.
Shareholder Returns
In second quarter 2015, the Company repurchased 8.2 million
shares of common stock at an average price of $81.94, for a total
investment of $675 million. The Company also paid dividends of $331
million during second quarter 2015, an increase of 22 percent from
$272 million last year. In total, the Company returned $1,006
million to shareholders in second quarter 2015, representing more
than 133 percent of net income.
Year-to-date, the company has repurchased 15.2 million shares at
an average price of $81.41, for a total investment of $1.2 billion.
Under the current $10 billion share repurchase program, through
second quarter 2015, the Company has repurchased 65.1 million
shares of common stock at an average price of $67.19, for a total
investment of approximately $4.4 billion.
For the trailing twelve months through second quarter 2015,
after-tax return on invested capital (ROIC) was 13.3 percent,
compared with 11.3 percent for the twelve months through second
quarter 2014. See the “Reconciliation of Non-GAAP Financial
Measures” section of this release for additional information about
the Company’s ROIC calculation.
Discontinued Operations Update
Target Canada Co. completed a court-approved real estate sales
process during second quarter 2015. Consistent with expectations,
after-tax losses from discontinued operations were $20 million in
second quarter 2015, compared with $157 million last year. Second
quarter losses from discontinued operations include an increase to
the Company’s accrual for estimated probable losses, primarily
guarantees of leases, and adjustments to the tax benefit from
our investment loss in Canada.
Certain assets and liabilities of Target’s discontinued
operations are based on estimates. The recorded assets include
estimated receivables, and the remaining liabilities include
accruals for estimated losses related to claims that may be
asserted against Target Corporation, primarily under guarantees of
certain leases. These estimates involve significant judgment and
are based on currently available information, an assessment of the
validity of certain claims and estimated payments by the Canada
Subsidiaries. These estimates are subject to change, and the
Company believes it is reasonably possible that adjustments to
these amounts could be material to its results of operations in
future periods. Any such adjustments would be recorded in
discontinued operations.
Conference Call Details
Target Corporation will webcast its second quarter earnings
conference call at 9:30 a.m. CST today. Investors and the media are
invited to listen to the call at Target.com/Investors (hover over
“company” then click on “events & presentations” in the
“investors” column). A telephone replay of the call will be
available beginning at approximately 11:30 a.m. CST today through
the end of business on August 21, 2015. The replay number is (855)
859-2056 (passcode: 50798511).
Miscellaneous
Statements in this release regarding third quarter and full-year
2015 earnings per share guidance and future expenses related to
discontinued operations are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Such statements speak only as of the date they are made and are
subject to risks and uncertainties which could cause the Company’s
actual results to differ materially. The most important risks and
uncertainties are described in Item 1A of the Company’s Form 10-K
for the fiscal year ended Jan. 31, 2015.
In addition to the GAAP results provided in this release, the
Company provides Adjusted EPS for the three- and six-month periods
ended Aug. 1, 2015, and Aug. 2, 2014. The Company also provides
ROIC for the twelve-month periods ended Aug. 1, 2015, and Aug. 2,
2014, respectively, which is a ratio based on GAAP information,
with the exception of adjustments made to capitalize operating
leases. Operating leases are capitalized as part of the ROIC
calculation to control for differences in capital structure between
the Company and its competitors. Adjusted EPS, capitalized
operating lease obligations and operating lease interest are not in
accordance with, or an alternative for, generally accepted
accounting principles in the United States. Management believes
Adjusted EPS is useful in providing period-to-period comparisons of
the results of the Company’s ongoing retail operations. Management
believes ROIC is useful in assessing the effectiveness of its
capital allocation over time. The most comparable GAAP measure for
adjusted diluted EPS is diluted EPS from continuing operations. The
most comparable GAAP measure for capitalized operating lease
obligations and operating lease interest is total rent expense.
Adjusted EPS, capitalized operating lease obligations and operating
lease interest should not be considered in isolation or as a
substitution for analysis of the Company’s results as reported
under GAAP. Other companies may calculate Adjusted EPS and ROIC
differently than the Company does, limiting the usefulness of the
measure for comparisons with other companies.
About Target
Minneapolis-based Target Corporation (NYSE: TGT) serves guests
at 1,799 stores and at Target.com. Since 1946, Target has given 5
percent of its profit to communities, that giving equals more than
$4 million a week. For more information, visit
Target.com/Pressroom. For a behind-the-scenes look at Target, visit
Target.com/abullseyeview or follow @TargetNews on Twitter.
TARGET CORPORATION
Consolidated Statements of
Operations
Three Months Ended Six Months Ended August 1, August 2,
August 1, August 2,
(millions, except per share data)
(unaudited) 2015 2014 Change
2015 2014 Change Sales $ 17,427 $ 16,957 2.8 % $
34,546 $ 33,614 2.8 % Cost of sales 12,051 11,798 2.1 23,962 23,546
1.8 Selling, general and administrative expenses 3,495 3,599 (2.9 )
7,009 6,974 0.5 Depreciation and amortization 551
537 2.5 1,090
1,049 4.0 Earnings before interest
expense and income taxes 1,330 1,023 30.0 2,485 2,045 21.5 Net
interest expense 148 433 (65.6 )
305 585 (48.0 ) Earnings
before income taxes 1,182 590 100.3 2,180 1,460 49.3 Provision for
income taxes 409 199 105.7
756 498 51.9
Net earnings from continuing operations 773 391 97.6
1,424 962 48.0
Discontinued operations, net of tax
(20 ) (157 ) (87.8 ) (36 ) (309
) (88.4 )
Net earnings $ 753 $
234 221.9 % $ 1,388 $ 653
112.7 %
Basic earnings/(loss) per share
Continuing operations $ 1.21 $ 0.62 96.9 % $ 2.23 $ 1.52 46.8 %
Discontinued operations (0.03 ) (0.25 )
(0.06 ) (0.49 ) Net earnings per
share $ 1.18 $ 0.37 220.7 %
$ 2.17 $ 1.03 111.1 %
Diluted earnings/(loss) per share Continuing operations $
1.21 $ 0.61 96.8 % $ 2.21 $ 1.51 46.7 % Discontinued operations
(0.03 ) (0.25 ) (0.06 )
(0.49 ) Net earnings per share $ 1.18
$ 0.37 220.6 % $ 2.16
$ 1.02 110.9 % Weighted average common
shares outstanding Basic 635.8 633.5 0.4 % 638.3 633.4 0.8 %
Dilutive impact of share-based awards 5.2 4.9
5.4 4.9 Diluted
641.0 638.4 0.4 %
643.7 638.3 0.8 % Antidilutive shares
— 5.1 —
5.2
Subject to reclassification
TARGET CORPORATION
Consolidated Statements of Financial
Position
August 1, January 31,
August 2,
(millions) 2015 2015 2014
(unaudited) (unaudited)
Assets Cash and cash equivalents,
including short term investments of $1,985, $1,520 and $3 $ 2,742 $
2,210 $ 766 Inventory (a) 8,269 8,290 7,929 Assets of discontinued
operations 97 1,333 693 Other current assets (a) 2,250
2,254 2,166 Total current assets
13,358 14,087 11,554 Property and equipment Land 6,120 6,127 6,109
Buildings and improvements 26,726 26,613 26,231 Fixtures and
equipment 5,145 5,329 5,042 Computer hardware and software 2,550
2,552 2,280 Construction-in-progress 494 424 652 Accumulated
depreciation (15,452 ) (15,093 ) (14,182 )
Property and equipment, net 25,583 25,952 26,132 Noncurrent assets
of discontinued operations 456 442 5,705 Other noncurrent assets
989 923 1,064
Total
assets $ 40,386 $ 41,404 $
44,455
Liabilities and shareholders’ investment
Accounts payable $ 6,944 $ 7,759 $ 6,986 Accrued and other current
liabilities 3,768 3,783 3,644 Current portion of long-term debt and
other borrowings 841 91 294 Liabilities of discontinued operations
60 103 412 Total current
liabilities 11,613 11,736 11,336 Long-term debt and other
borrowings 11,883 12,705 12,625 Deferred income taxes 1,319 1,321
1,233 Noncurrent liabilities of discontinued operations 276 193
1,333 Other noncurrent liabilities 1,353 1,452
1,495 Total noncurrent liabilities 14,831
15,671 16,686 Shareholders’ investment Common stock 53 53 53
Additional paid-in capital 5,271 4,899 4,561 Retained earnings
9,099 9,644 12,611 Accumulated other comprehensive loss Pension and
other benefit liabilities (444 ) (561 ) (408 ) Currency translation
adjustment and cash flow hedges (37 ) (38 )
(384 ) Total shareholders’ investment 13,942
13,997 16,433
Total liabilities and
shareholders’ investment $ 40,386 $ 41,404
$ 44,455
Common Stock Authorized 6,000,000,000 shares, $.0833 par
value; 630,446,029, 640,213,987 and 633,644,605 shares issued and
outstanding at August 1, 2015, January 31, 2015 and
August 2, 2014, respectively.
Preferred Stock Authorized 5,000,000 shares, $.01 par
value; no shares were issued or outstanding at August 1, 2015,
January 31, 2015 or August 2, 2014.
(a) At August 1, 2015, $464 million of pharmacy prescription
inventory is classified as held for sale and included in other
current assets. At January 31, 2015 and August 2, 2014, $500
million and $479 million, respectively, of pharmacy prescription
inventory has been reclassified to conform with the current period
presentation.
Subject to reclassification
TARGET CORPORATION
Consolidated Statements of Cash
Flows
Six Months Ended August 1,
August 2,
(millions) (unaudited) 2015
2014
Operating activities Net earnings $ 1,388
$ 653 Losses from discontinued operations, net of tax (36 )
(310 ) Net earnings from continuing operations
1,424 963 Adjustments to reconcile net earnings to cash provided by
operations: Depreciation and amortization 1,090 1,049 Share-based
compensation expense 54 40 Deferred income taxes (45 ) (158 ) Loss
on debt extinguishment — 285 Noncash (gains)/losses and other, net
(34 ) 26 Changes in operating accounts: Inventory 18 (130 ) Other
assets 156 179 Accounts payable and accrued liabilities (697
) (319 ) Cash provided by operating
activities—continuing operations 1,966 1,935 Cash provided by/
(required for) operating activities—discontinued operations
823 (421 ) Cash provided by operations
2,789 1,514
Investing
activities Expenditures for property and equipment (710 ) (881
) Proceeds from disposal of property and equipment 13 44 Proceeds
from sale of business 8 — Cash paid for acquisitions, net of cash
assumed — (20 ) Other investments 38 46
Cash required for investing activities—continuing
operations (651 ) (811 ) Cash provided by/ (required for) investing
activities—discontinued operations 19
(171 ) Cash required for investing activities (632 )
(982 )
Financing activities Change in
commercial paper, net — 109 Additions to long-term debt — 1,993
Reductions of long-term debt (54 ) (2,039 ) Dividends paid (665 )
(545 ) Repurchase of stock (1,237 ) — Stock option exercises and
related tax benefit 331 55
Cash required for financing activities (1,625 )
(427 ) Effect of exchange rate changes on cash
and cash equivalents — 3
Net increase in cash and cash equivalents 532 108 Cash and cash
equivalents at beginning of period 2,210
695 (a)
Cash and cash equivalents at end of
period $ 2,742 $ 803 (b)
(a) Includes cash of our discontinued operations of $25 million
at February 1, 2014.(b) Includes cash of our discontinued
operations of $37 million at August 2, 2014.
Subject to reclassification
TARGET CORPORATION
Segment Results
Three Months Ended Six Months Ended August 1, August 2,
August 1, August 2,
(millions) (unaudited)
2015 2014 Change 2015 2014
Change Sales $ 17,427 $ 16,957 2.8 % $ 34,546 $ 33,614 2.8 %
Cost of sales 12,051 11,798 2.1
23,962 23,546 1.8
Gross margin 5,376 5,159 4.2 10,584 10,068 5.1 SG&A
expenses(a) 3,475 3,473 0.1
6,883 6,817 1.0
EBITDA 1,901 1,686 12.7 3,701 3,251 13.8 Depreciation and
amortization 551 537 2.5
1,090 1,049 4.0
EBIT $ 1,350 $ 1,149 17.5 %
$ 2,611 $ 2,202 18.5 %
Note: We operate as a single segment which includes all of our
continuing operations, excluding net interest expense, data breach
related costs and certain other expenses that are discretely
managed. Our segment operations are designed to enable guests to
purchase products seamlessly in stores, online or through mobile
devices. Beginning with the first quarter of 2015, segment EBIT
includes the impact of the reduction of the beneficial interest
asset. For comparison purposes, prior year segment EBIT has
been revised.(a) SG&A includes $159 million and $311 million of
net profit-sharing income under our credit card program agreement
for the three and six months ended August 1, 2015,
respectively, and $156 million and $305 million for the three and
six months ended August 2, 2014, respectively.
Three Months Ended
Six Months Ended
Segment Rate Analysis August 1,
August 2, August 1, August 2,
(unaudited) 2015
2014 2015 2014 Gross margin rate 30.9
%
30.4
%
30.6
%
30.0
%
SG&A expense rate 19.9 20.5 19.9 20.3 EBITDA margin rate 10.9
9.9 10.7 9.7 Depreciation and amortization expense rate 3.2 3.2 3.2
3.1 EBIT margin rate 7.7 6.8 7.6
6.6
Note: Rate analysis metrics are computed
by dividing the applicable amount by sales.
Three Months Ended Six Months
Ended
Sales by Channel August 1, August 2, August 1, August
2,
(unaudited) 2015 2014 2015
2014 Stores 97.3
%
97.8
%
97.2
%
97.9
%
Digital 2.7 2.2 2.8
2.1 Total 100
%
100
%
100
%
100
%
Three Months Ended Six Months
Ended
Comparable Sales August 1, August 2, August 1, August
2,
(unaudited) 2015 2014 2015
2014 Comparable sales change 2.4
%
—
%
2.4
%
(0.2 )% Drivers of change in comparable sales Number of
transactions 1.6 (1.3 ) 1.3 (1.8 ) Average transaction amount 0.8
1.3 1.1 1.7 Selling price per unit 3.8 3.0 4.5 2.4 Units per
transaction (2.9 ) (1.7 ) (3.2 ) (0.7 )
Note: Amounts may not foot due to
rounding.
Contribution to Comparable Sales
Change(unaudited)
Three Months Ended Six Months Ended
August 1,2015
August 2,2014 August 1,2015 August 2,2014
Stores channel comparable sales change 1.8
%
(0.6 )% 1.7
%
(0.7 )% Digital channel contribution to comparable sales change
0.6 0.6 0.7 0.5
Total comparable sales change 2.4
%
—
%
2.4
%
(0.2 )%
Note: Amounts may not foot due to
rounding.
Three Months Ended Six Months
Ended
REDcard Penetration August 1, August 2, August 1,
August 2,
(unaudited) 2015 2014 2015
2014 Target Debit Card 12.0
%
11.1
%
12.0
%
11.2
%
Target Credit Cards 10.1 9.7 9.8
9.4 Total REDcard Penetration 22.1
%
20.8
%
21.8
%
20.6
%
Note: Amounts may not foot due to
rounding.
Number of Stores
Retail Square Feet(a)
Number of Stores and Retail Square
Feet August 1, January 31, August 2, August 1,
January 31, August 2,
(unaudited) 2015
2015 2014 2015 2015 2014
Expanded food assortment stores 1,297 1,292 1,278 167,659 167,026
165,198 SuperTarget stores 249 249 249 44,151 44,151 44,152 General
merchandise stores 239 240 259 27,847 27,945 30,121 CityTarget
stores 9 8 8 987 820 820 TargetExpress stores 5 1
1 92 21 21 Total 1,799
1,790 1,795 240,736 239,963 240,312
(a) In thousands: reflects total square feet, less office,
distribution center and vacant space.
Subject to reclassification
TARGET CORPORATION
Reconciliation of Non-GAAP Financial Measures
To provide additional transparency, we have disclosed non-GAAP
adjusted diluted earnings per share from continuing operations
(Adjusted EPS). This metric excludes restructuring costs, net
expenses related to the 2013 data breach and other matters
presented below. We believe this information is useful in providing
period-to-period comparisons of the results of our continuing
operations. This measure is not in accordance with, or an
alternative for, generally accepted accounting principles in the
United States. The most comparable GAAP measure is diluted earnings
per share from continuing operations. Adjusted EPS should not be
considered in isolation or as a substitution for analysis of our
results as reported under GAAP. Other companies may calculate
Adjusted EPS differently than we do, limiting the usefulness of the
measure for comparisons with other companies. Prior year amounts
have been revised to present Adjusted EPS on a continuing
operations basis.
Adjusted EPS Three
Months Ended August 1, 2015 August 2, 2014
Net of Per Share Net of Per Share
(millions, except per share data) (unaudited)
Pretax Tax Amounts Pretax Tax
Amounts Change GAAP diluted earnings per share from
continuing operations $ 1.21 $ 0.61 96.8 % Adjustments
Restructuring costs (a) $ 11 $ 8 $ 0.01 $ — $ — $ — Data
Breach-related costs (b) 9 5 0.01 111 71 0.11 Loss on early
retirement of debt — — — 285 174 0.27 Impairments — — — 16 9 0.01
Resolution of income tax matters — (5 )
(0.01 ) — — —
Adjusted diluted earnings per share from continuing
operations $ 1.22
$ 1.01 20.6 %
Six Months Ended August 1, 2015
August 2, 2014 Net of Per Share Net of Per Share (millions,
except per share data) Pretax Tax Amounts
Pretax Tax Amounts GAAP diluted
earnings per share from continuing operations $ 2.21 $ 1.51 46.7 %
Adjustments Restructuring costs (a) $ 114 $ 72 $ 0.11 $ — $ — $ —
Data Breach-related costs (b) 12 7 0.01 129 83 0.13 Loss on early
retirement of debt — — — 285 174 0.27 Impairments — — — 16 9 0.01
Card brand conversion costs (c) — — — 13 8 0.01 Resolution of
income tax matters — (8 ) (0.01 )
— (1 ) — Adjusted
diluted earnings per share from continuing operations
$ 2.32
$ 1.93 20.1 %
Note: Amounts may not foot due to rounding. Beginning with the
first quarter 2015, we no longer adjust for the reduction of the
beneficial interest asset because it is no longer meaningful. For
comparison purposes, prior year Adjusted EPS has been revised.(a)
Costs related to our previously announced corporate
restructuring.(b) For the three and six months ended August 1,
2015, we recorded $9 million and $12 million of pretax Data
Breach-related expenses, respectively, primarily for legal and
other professional services. For the three and six months ended
August 2, 2014, we recorded $148 million and $175 million of
pretax expenses, respectively. Along with legal and other
professional services, the 2014 expenses included an increase to
the accrual for what we believe to be the vast majority of actual
and potential Data Breach-related claims, including claims by
payment card networks. We also recorded expected insurance proceeds
of $38 million and $46 million for the three and six months ended
August 2, 2014, respectively, for net pretax expenses of $111
million and $129 million.(c) Expense related to converting the
co-branded REDcard program to MasterCard.
We have also disclosed after-tax return on invested capital for
continuing operations (ROIC), which is a ratio based on GAAP
information, with the exception of adjustments made to capitalize
operating leases. Operating leases are capitalized as part of the
ROIC calculation to control for differences in capital structure
between us and our competitors. We believe this metric provides a
meaningful measure of the effectiveness of our capital allocation
over time. Other companies may calculate ROIC differently than we
do, limiting the usefulness of the measure for comparisons with
other companies.
After-Tax Return on Invested Capital
Numerator Trailing Twelve
Months August 1, August 2,
(dollars in millions)
(unaudited) 2015 2014 Earnings from continuing
operations before interest expense and income taxes $ 4,974 $ 4,301
+ Operating lease interest (a)(b) 90 94
Adjusted earnings from continuing operations before interest
expense and income taxes 5,064 4,395 - Income taxes (c)
1,694 1,492
Net operating profit after
taxes $ 3,370 $
2,903
Denominator August 1, August 2, August 2,
(dollars
in millions) (unaudited) 2015 2014 2013
Current portion of long-term debt and other borrowings $ 841 $ 294
$ 1,828 + Noncurrent portion of long-term debt 11,883 12,625 11,386
+ Shareholders' equity 13,942 16,433 16,020 + Capitalized operating
lease obligations (b)(d) 1,497 1,573 1,631 - Cash and cash
equivalents 2,742 766 810 - Net assets of discontinued operations
217 4,653 4,165 Invested capital
$ 25,204 $ 25,506 $ 25,890
Average invested capital (e) $
25,356 $ 25,698
After-tax return on invested capital 13.3
% 11.3 %
(a) Represents the hypothetical capitalization of our operating
leases, using eight times our trailing twelve months rent expense
and an estimated interest rate of six percent.(b) See the following
Reconciliation of Capitalized Operating Leases table for the
adjustments to our GAAP total rent expense to obtain the
hypothetical capitalization of operating leases and related
operating lease interest.(c) Calculated using the effective tax
rate for continuing operations, which was 33.4% and 33.9% for the
trailing twelve months ended August 1, 2015 and August 2,
2014.(d) Calculated as eight times our trailing twelve months rent
expense.(e) Average based on the invested capital at the end of the
current period and the invested capital at the end of the prior
period.
Capitalized operating lease obligations and operating lease
interest are not in accordance with, or an alternative for,
generally accepted accounting principles in the United States. The
most comparable GAAP measure is total rent expense. Capitalized
operating lease obligations and operating lease interest should not
be considered in isolation or as a substitution for analysis of our
results as reported under GAAP.
Reconciliation of Capitalized Operating
Leases Trailing Twelve Months August 1, August 2,
August 2,
(dollars in millions) (unaudited)
2015 2014 2013 Total rent expense $ 187 $ 197 $ 204
Capitalized operating lease obligations (Total rent expense x 8)
1,497 1,573 1,631 Operating lease interest (Capitalized operating
lease obligations x 6%) 90 94
n/a
Subject to reclassification
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150819005578/en/
Target CorporationJohn Hulbert, Investors, 612-761-6627orErin
Conroy, Media, 612-761-5928orTarget Media Hotline, 612-696-3400
Target (NYSE:TGT)
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