CHICAGO (Reuters) - target Corp. (TGT).(N) posted an increase in largest quarterly profit as planned on Wednesday, as the profitability soared in its business from credit card to mitigate the impact of some sluggish sales in its stores.
Shoppers visited the chain discount food and other bases, but he spend with caution. Discretionary goods like clothing sales were under pressure as shoppers digest more raised for food, gasoline and other essential elements.
Shares of target backed pre-market gains and fell 3 cents to $50.75 with about an hour to go before the market opens.
Target has been adding fresh food products to several of its stores and subscription shoppers more for credit cards. But grocery transport margins lower than in other parts of the store and discount of 5% of smaller credit cards margins.
However, these initiatives have led to more visits and sales, while shoppers "remain cautious in their spending," said Director General Gregg Steinhafel.
Target has obtained $ 689 million, or 99 cents per share, in the first quarter finished on 30 April, from 671 million, or 90 cents per share, a year earlier. Analysts, on average, should he win 94 cents per share, according to Thomson Reuters I/B/E s.
Sales increased 2.8% to 15.58 billion, with sales in stores open at least a year up to 2%, the company said earlier this month. Total income, including credit card revenue, increased by 2.2% to 15.94 billion.
Shoppers more use the credit and debit cards of the company, with 7.6% of sales in stores released for cards in the course of the quarter of 4.9% a year earlier.
Profit in the business of credit card jumped to about 75% of $ 194 million. Finance improvement of consumers has helped target reduce bad debt expenses to $ 197 million $ 12 million a year earlier.
Average credit card debt has decreased by 14.4% to $ 6.5 billion, and those directly funded by target increased by 6% to $ 2.5 billion. In January, target said it wants to sell its credit card receivables.
(Reported by Jessica Wohl;) (Editing by Derek Caney, Dave Zimmerman)
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