Retail News Breaks
Steinhafel: Target on growth track
June 14th, 2012
CHICAGO – Target Corp. chose the site of one of its first CityTarget stores, set to open next month, as the venue for this year's annual shareholders meeting.
The choice was apt, since the CityTarget format represents one of the potential growth opportunities ahead of Target, which marked its 50th anniversary in May.
Target chairman, president and chief executive officer Gregg Steinhafel told shareholders that Target generated 3% annual comparable store sales growth in 2011, which is its strongest annual performance since 2007. It also puts the company on track to reach its growth goals.
"Last fall, we outlined our long-range financial plan to reach $100 billion or more in sales and $8 or more in earnings per share by 2017," Steinhafel said. "To achieve these 2017 results, we need to grow U.S. same-store sales over this period by 3% annually, preserve our current retail profit margin, deploy excess cash flow to retire 3% to 4% of our shares annually and continue to increase our dividend as we've done every year since 1971."
Target's "Expect More, Pay Less" brand promise remains critical to its strategy as well, as does the expanded grocery assortment in its stores and its devotion to "differentiation and affordable design."
New stores will also play a critical role.
"CityTarget, including this beautifully renovated State Street landmark, extends our brand and strategy to urban areas and guests who already have a high affinity for Target but can't always get to our stores," Steinhafel said. "Next month we'll open our first CityTarget locations in Los Angeles, Seattle and here on State Street. In October, we'll open our second site in L.A. and our first in San Francisco. And next year, we'll debut CityTarget in Portland, Ore., and open our third L.A. location."
Target is also working to enhance its online business, and is preparing for its expansion into Canada, which it expects to contribute $6 billion or more in sales by 2017.
"A lot has changed in our first 50 years in business, but some things haven't," Steinhafel concluded. "Target remains as enthusiastic about listening to our guests and is innovative and adaptable in anticipating their needs as we were on our opening day. The long-term view, ethical practices and the drive to do exceptionally well for our guests, team members, shareholders and communities still influence everything we do. And our team continues to energetically embrace the opportunities before us, working with speed and constantly challenging the status quo to drive benefits for all of our stakeholders. As a result, I certainly believe we're creating a future that's every bit as bright as our first 50 years have been."
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