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Staples, Target hit 3Q
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November 20, 2001: 11:31 a.m. ET
Retailers match estimates despite sluggish spending, economy.
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Wal-Mart, Home Depot, Penney hit marks - Nov. 13, 2001
Staples promotes president to CEO - Sept. 5, 2001
Staples gets stock swap OK - Aug. 27, 2001
Staples 2Q meets forecasts on flat sales - Aug. 21, 2001
Staples, Talbots 1Q in line, B.J.'s beats - May 22, 2001
Staples directors won't see windfall - Apr. 3, 2001
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NEW YORK (CNN/Money) - Staples Inc. and Target Corp. posted third-quarter results in line with Wall Street expectations, despite the impact of a slowing economy and the Sept. 11 terrorist attacks on the retail industry.
Discount chain Target Corp. (TGT: down $1.20 to $36.59, Research, Estimates), which also operates the Marshall Field and Mervyn's department store chains, reported third-quarter earning before unusual items of $226 million, or 25 cents a share, compared with earnings of $216 million, or 24 cents a share, a year earlier. Analysts polled by earnings tracker First Call anticipated a profit of 25 cents a share.
Including a $67 million pre-tax charge related to an accounting change, Target posted net earnings of $185 million, or 20 cents a share, the company said.
Third-quarter sales increased 9 percent in the quarter to $9.4 billion from $8.6 billion. Most of those sales came from the company's Target discount stores.
"On balance, we are pleased with our third-quarter results," CEO Bob Ulrich said in a statement. "And we believe our strategies position us well to deliver reasonable growth in earnings per share in the fourth quarter."
Meanwhile Staples (SPLS: up $0.11 to $18.77, Research, Estimates) posted an improved third-quarter profit that met lowered Wall Street expectations, as the company said Tuesday it should meet or beat current estimates for the fourth quarter as well.
The Framingham, Mass.-based company, the No. 2 office supply retailer behind Office Depot Inc. (OPD: Research, Estimates) earned $91.3 million, or 20 cents a share, for the period ended Nov. 3, up from $84.7 million, or 18 cents a share, a year earlier when the earlier results are adjusted to reflect a conversion of Staples.com stock.
Analysts surveyed by First Call lowered their earnings-per-share forecasts for the period to 20 cents from 21 cents following the Sept. 11 terrorist attacks.
The company said it anticipates fourth-quarter earnings of 25 cents-to-27 cents a share, near analysts' forecasts of 25 cents a share, compared with 20 cents a share a year earlier, according to First Call.
Staples also expects strong earnings growth in its next fiscal year. Analysts estimate 2003 earnings of 75 cents a share.
Sales for the company gained 1 percent to $2.8 billion, a bit short of the $2.9 billion forecast from First Call. Sales from stores open at least a year, a closely watched retail measure known as same-store sales, were down 5 percent.
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The company said a drop in sales it attributed to the terrorist attack reduced same-store sales by 2 percent, and that overall comparable sales were down 3 percent when online sales are included.
In other retail earnings, specialty clothing retailer Limited Inc. (LTD: down $0.23 to $13.68, Research, Estimates) reported a third-quarter loss due to lower sales, although the loss was less than First Call's forecast for the period, while women's apparel retailer Talbots Inc. (TLB: down $0.21 to $34.80, Research, Estimates) earnings rose slightly above estimates. And BJ's Wholesale Club Inc. (BJ: up $2.70 to $46.40, Research, Estimates) posted a loss due to contingent lease obligations, but said earnings excluding special charges rose in line with forecasts.
Columbus, Ohio-based Limited's brands include Limited, Express, Lerner New York and an 84 percent stake in Intimate Brands Inc. (IBI: down $0.25 to $14.01, Research, Estimates), operator of Victoria's Secret and Bath & Body Works. The company said it lost $11.8 million, or 3 cents a share, in the period ended Nov. 3, excluding a gain from the sale of Lane Bryant. That compares with the First Call forecast of a loss of 4 cents a share, and a profit of $49.2 million, or 11 cents a share, excluding special items a year earlier.
The company said it is comfortable with the First Call fourth-quarter EPS forecast of 52 cents, down from 55 cents a year ago, although it cautioned the economic outlook remains uncertain.
Sales fell to $1.9 billion from $2.2 billion a year earlier, as same-store sales dropped 7 percent. The First Call revenue forecast was for just under $2 billion.
Talbots posted net income of $36.6 million, or 58 cents a share, up from $34.9 million, or 54 cents, a year earlier. First Call's forecast called for EPS of 57 cents. Sales slipped to $394 million from $397.1 million, as it met forecasts. Same-store sales fell 8.2 percent.
BJ's earned $29.5 million, or 40 cents a share, in the quarter, excluding a charge for lease obligation. That met First Call's forecast and was up from net income of $27.4 million, or 37 cents a share, a year earlier. Including the charge for the leases, the company posted a net loss of $33.5 million, or 46 cents a share. Revenue for the Natick, Mass.-based company increased to $1.3 billion from $1.2 billion a year earlier. 
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Wal-Mart, Home Depot, Penney hit marks - Nov. 13, 2001
Staples promotes president to CEO - Sept. 5, 2001
Staples gets stock swap OK - Aug. 27, 2001
Staples 2Q meets forecasts on flat sales - Aug. 21, 2001
Staples, Talbots 1Q in line, B.J.'s beats - May 22, 2001
Staples directors won't see windfall - Apr. 3, 2001
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