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October comps up 2.4% at Target

A 2.4% same-store sales increase during October was toward the low end of Target’s expectations, but it wasn’t enough to prevent the company from achieving its guidance for the third quarter.

Target reported that its net retail sales for the four weeks ended Oct. 27 were nearly $5 billion, a 3% increase from $4.8 billion reported during October 2011. The 2.4% comp increase was on top of a prior year gain of 3.3%.

"While Target’s October comparable-store sales were near the low end of our expected range, our third quarter comparable-store sales increase of 2.9% was in line with our guidance," said Gregg Steinhafel, chairman, president and CEO. "As we enter the fourth quarter we feel very good about our holiday season merchandising and marketing plans and our ability to deliver outstanding value for our guests while generating strong financial performance for our shareholders."

Steinhafel made no mention of Hurricane Sandy’s impact on the company’s October results in a press release. However, the company did elaborate on several one time beneficial effects that will impact third quarter results when they are release later this month.

In its second quarter 2012 earnings press release Target indicated that in third quarter 2012 it expected adjusted earnings per share of 83 cents to 93 cents and earnings on a GAAP (generally accepted accounting principle) basis to range from 69 cents to 79 cents. The 14 cent difference between the ranges reflected the expected earnings impact of expenses related to the company’s Canadian market launch. Beyond the impact of its Canadian market launch, Target now expects its third quarter GAAP calculation to benefit by four cents due to a favorable resolution of an income tax matter and by 15 cents due to the recently announced sale of the credit card receivables portfolio to TD Bank Group.