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DAYTON HUDSON REPORTS RECORD REVENUES, LOWER EARNINGS FOR 1991

 DAYTON HUDSON REPORTS RECORD REVENUES, LOWER EARNINGS FOR 1991
 MINNEAPOLIS, March 12 /PRNewswire/ -- Dayton Hudson Corporation (NYSE: DH) today said revenues for the fiscal year ended Feb. 1, 1992 rose 9 percent to a record $16.11 billion from $14.74 billion in 1990. Comparable-store revenues increased 2 percent from 1990.
 The difficult economic environment was reflected in the corporation's 1991 operating profit, which totaled $910 million compared with $1,015 million in 1990.
 Net earnings for the year were $301 million, compared with $412 million in 1990.
 Fully diluted earnings per share were $3.72 versus $5.20 in 1990.
 "We were disappointed with our 1991 results. Our gross margins in all our operating divisions were under pressure throughout the year because of the competitive environment," said Kenneth A. Macke, chairman and chief executive officer. "Although Target's mid-year implementation of its value strategy was at considerable cost to gross margin, its comparable-store revenues improved significantly. I believe Target is positioned very well for strong performance in 1992."
 Macke said the corporation was disappointed with its Christmas results and with the California economy. "Both were factors in Mervyn's lower 1991 results," he said.
 "We expect these conditions to continue for at least part of 1992. Although sales thus far in the first quarter have been generally better than anticipated in all our divisions, they continue to be very promotional. We are reducing our operating expense rate and planning very conservatively. Inventories are well controlled going into the spring season."
 Target's 1991 operating profit totaled $458 million versus $466 million a year ago. Revenues were a record $9.04 billion, up 11 percent from 1990, reflecting the success of the value strategy and aggressive new-store growth. Comparable-store revenues rose 4 percent from last year. Operating expense rate improved as a result of cost controls and revenue growth. Gross margin rate declined significantly due to the value strategy. Target added 43 stores, including a successful major market expansion in Florida and the testing of a new store format designed for smaller markets.
 Mervyn's lower operating profit was primarily due to weak sales in California, which accounts for more than half of its sales. Operating profit was $284 million compared with $366 million a year ago. Revenues in 1991 were $4.14 billion, up 2 percent, reflecting new store expansion. Comparable-store revenues declined 1 percent due to the difficult California economy. The decline in comparable-store revenues resulted in a slight rise in operating expense rate after five consecutive years of improvement. Gross margin rate was reduced primarily by higher markdowns. Mervyn's opened 18 new stores in 1991, including a major entry into south Florida.
 The Department Store Division's operating profit in 1991 totaled $168 million compared with $183 million a year ago. Revenues were $2.93 billion, up 17 percent from $2.51 billion in 1990, reflecting the full-year results of Marshall Field's business. Comparable-store revenues rose 1 percent. Operating expense rate increased slightly reflecting a full year of depreciation from the Field's acquisition, offset in part by efficiencies gained from the integration of Field's. Gross margin rate was negatively affected by markdowns in the highly promotional environment. The division's 1990 results included Field's operations since its acquisition date of June 24, 1990.
 The 1991 impact of the LIFO inventory accounting method was a 32 cent-per-share credit, totaling $38 million, versus a charge of 25 cents per share, or $31 million, in 1990. The 1991 LIFO credit includes a 39 cent-per-share benefit from Target's adoption of an internally generated price index. Target's internal price index better reflects the impact of its retail price changes following implementation of its value-pricing strategy. Mervyn's and the Department Store Division will continue to use the Bureau of Labor Statistics' Department Stores Inventory Price Index to estimate inventory inflation. The 1990 LIFO charge is net of a 24 cent-per-share credit related to the Marshall Field's acquisition.
 Fourth-quarter net earnings totaled $192 million versus $235 million in 1990. Fully diluted earnings per share were $2.47, compared with $3.05 in 1990. The LIFO impact was a credit of $70 million, or 59 cents per share, versus a credit of $3 million, or 3 cents per share, in the 1990 quarter.
 Revenues for the fourth quarter were $5.25 billion, up 8 percent from 1990. Comparable-store revenues increased 1 percent.
 Dayton Hudson Corporation is a growth company focused exclusively on retailing. The corporation's strategy is to provide American consumers with exceptional value, style and service through multiple, large-scale retail formats ranging from upscale discount to moderate-priced and full-service department stores. At year-end, the corporation operated 770 Target, Mervyn's, Dayton's, Hudson's and Marshall Field's stores in 33 states.
 DAYTON HUDSON CORPORATION
 SUPPLEMENTAL DATA
 credit/(charge)
 Three Months Ended 12 Months Ended
 Feb. 1 Feb. 2 Feb. 1 Feb. 2
 1992 1991 1992 1991
 LIFO $ millions $70 $3 $38 $(31)
 per share $.59 $.03 $.32 $(.25)
 Marshall Field's
 per share $.05 $.10 $(.25) $(.10)
 ESOP dilution
 per share $(.01) $.01 $(.31) $(.23)
 Note: Dayton Hudson defines operating profit as LIFO earnings from operations before corporate expense, interest and income tax.
 Revenues by business segment were as follows:
 Percentage Change
 All Comp.
 Millions of Dollars 1991 1990 Stores Stores
 Target $9,041 $8,175 11 4
 Mervyn's 4,143 4,055 2 (1)
 DSD 2,931 2,509 17 1
 Total 16,115 14,739 9 2
 Operating profit by business segment was as follows:
 Millions of Dollars 1991 1990 Percentage Change
 Target $458 $466 (2)
 Mervyn's 284 366 (22)
 DSD 168 183 (8)
 Total $910 $1,015 (10)
 CONSOLIDATED RESULTS OF OPERATIONS
 (Dollars in millions, except per-share numbers)
 Fourth Quarter Total Year
 1991 1990(a) 1991 1990(a)
 (Unaudited) (Unaudited)
 REVENUES $5,249 $4,865 $16,115 $14,739
 COSTS AND EXPENSES
 Cost of retail sales,
 buying and occupancy 3,820 3,508 11,751 10,652
 Selling, publicity and
 administrative 844 724 2,801 2,478
 Depreciation 105 93 410 369
 Interest expense, net 107 94 398 325
 Taxes other than income taxes 74 69 283 256
 ----- 4,950 4,488 15,643 14,080
 EARNINGS BEFORE INCOME TAXES 299 377 472 659
 Provision for income taxes 107 142 171 249
 EARNINGS BEFORE ACCOUNTING
 CHANGES 192 235 301 410
 Net cumulative effect of
 accounting changes -- -- -- 2
 NET EARNINGS $192 $235 $301 $412
 PRIMARY EARNINGS PER SHARE $2.60 $3.21 $3.86 $5.44
 FULLY DILUTED EARNINGS
 PER SHARE $2.47 $3.05 $3.72 $5.20
 AVERAGE COMMON SHARES OUTSTANDING (Millions):
 Primary 71.4 71.3 71.5 71.3
 Fully Diluted 75.8 75.7 75.9 75.7
 (a) Includes the results of Marshall Field's since its acquisition date of June 24, 1990.
 CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
 (Dollars in millions)
 1991 1990
 Feb. 1, 1992 Feb. 2, 1991
 (Unaudited)
 ASSETS
 Current Assets
 Cash $96 $92
 Accounts receivable 1,430 1,407
 Merchandise inventories 2,381 2,016
 Other 125 143
 Total Current Assets $4,032 $3,658
 Property 5,102 4,525
 Other 351 341
 TOTAL ASSETS $9,485 $8,524
 LIABILITIES AND COMMON SHAREHOLDERS' INVESTMENT
 Current Liabilities
 Commercial paper $265 $104
 Accounts payable 1,324 1,267
 Other 991 1,051
 Total Current Liabilities 2,580 2,422
 Long-term debt 4,227 3,682
 Other 447 372
 Common shareholders' investment 2,231 2,048
 TOTAL LIABILITIES AND COMMON
 SHAREHOLDERS' INVESTMENT $9,485 $8,524
 Shares outstanding at year-end (millions) 71.2 71.1
 -0- 3/11/92
 /CONTACT: (Media) Ann H. Barkelew, 612-370-6600, or (Investor) James R.Eckmann, 612-370-5529, both of Dayton Hudson/
 (DH) CO: Dayton Hudson Corporation ST: Minnesota IN: REA SU: ERN


AL -- MN002 -- 7646 03/12/92 09:09 EST
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