Kids retailer scorecard

By Janice Chamberlain -- Kids Today, 10/1/2005 12:00:00 AM

High Point —

Annual aggregate sales for the nine retailers on the Kids Today annual scorecard were up 7.8% — a percentage point higher than last year — while net income jumped 16.5%, both compared with 2003 annual figures. In 2003, composite profits surged more than 55%.

Total sales for the nine companies reached $426.8 billion, compared with $396 billion the previous year. Earnings increased from $13.3 billion in 2003 to $15.4 billion in 2004.

Collective operating income increased by 18.7% to $24.2 billion from $20.3 billion in the year-earlier period.

Perennial leader Wal-Mart, which added $28.9 billion in sales from 2003 to 2004, more than duplicating its sales gain from 2002 to 2003, once again posted the largest single sales increase in dollars. That's an 11.3% increase for the mega-retailer in 2004.

Add to Wal-Mart's record a 13.4% increase in profits, or a $1.2 billion increase, to $10.3 billion in earnings for the 2004 year.

But those results only earned Wal-Mart a fourth-place position on the list of companies with major profit gains from 2003.

In terms of dollar gains in earnings, Wal-Mart trailed Kmart, J.C. Penney and Target Corp., with increases of $1.7 billion, $1.5 billion and $1.4 billion, respectively, compared with 2003 profits.

Compared with 2000, Wal-Mart took top honors in both sales gains and profit increases, adding $104.4 billion in sales from 2000 to 2004 and $4.2 billion in earnings for the same five-year period. Target placed second in both measurements, adding $9.3 billion in sales and $1.9 billion in net income.

Wal-Mart also bested the competition in inventory turns, with 7.8 turns in 2004, equaling year-earlier results.

Target recorded 6.3 turns for second place, and Sears posted 4.8 inventory turns in 2004 to come in third.

J.C. Penney led the way in same-store sales growth, gaining 5% for the year. Not far behind was the 4.5% posted by Bed Bath & Beyond.

The two textiles specialty chains, Bed Bath & Beyond and Linens 'n Things, came in first and second in gross margin percentage with results of 42.5% and 40.3%, respectively.

This version of the Kids Today annual retail scorecard is based on the annual financial results of nine publicly held retailers with fiscal years ending between Jan. 1 and Feb. 26, 2005.

Retail composite results
($millions)

	2004	2003	% Change
Sales	$426,822.8	$396,045.3	7.8%
Operating income	$24,158.1	$20,349.3	18.7
Net income	$15,436.8	$13,253.3	16.5

Profit gains, '03–'04

$millions	Change
Kmart	$1,734.0
J.C. Penney	1,465.0
Target	1,389.0
Wal-Mart	1,213.0
Toys "R" Us	189.0

Profit gains, '00–'04

$millions	Change
Wal-Mart	$4,180.0
Target	1,934.0
Kmart	1,374.0
J.C. Penney	1,217.0
Bed Bath & Beyond	333.0

Sales swings, '03–'04

$millions	Change
Wal-Mart	$28,893.0
Target	4,754.0
Bed Bath & Beyond	669.7
J.C. Penney	638.0
Linens 'n Things	266.2

Sales swings, '00–'04

$millions	Change
Wal-Mart	$104,435.0
Target	9,320.0
Bed Bath & Beyond	2,751.0
Linens 'n Things	1,088.9
Toys "R" Us	(232.0)

	Year ended	Net income ($thousands) 2004	Percentage change		Return on sales	Return on equity	Net sales ($thousands) 2004	Percentage change		Change in same-store sales	Gross margin percentage	Inventory turns
			'03–'04	'00–'04				'03–'04	'00–'04
R = Restated 1. Includes $193 million in net income from discontinued operations. 2. Excludes non-sales revenues of $2.8 billion in 2004 and $2.4 billion in 2003. 3. For domestic stores. 4. Includes $75 million in net earnings from discontinued operations and a $1.2 billion net gain on the disposal of discontinued operations. 5. Includes $190 million in net earnings from discontinued operations. 6. Excludes net credit revenues of $1.2 billion in 2004, $1.1 billion in 2003 and $541 million in 2000. 7. Includes a $41 million pretax charge for special charges and impairments and an $839 million extraordinary charge, the cumulative effect of an accounting change. 8. Includes a $791 million net loss on the early retirement of debt, a $140 million pretax charge for special charges and impairments and a $4.2 billion pretax gain on the sale of businesses. Net income in 2003 was $3.4 billion. 9. Includes a $251 million pretax charge for asset impairment losses and a $49 million after-tax minority interest charge. Net income in 2000 was $1.3 billion. 10. Excludes credit and financial products revenues of $381 million in 2004 and $4.8 billion in 2003. 11. Excludes $4.6 billion in credit revenues. 12. 2004 and 2003 are 52 weeks; 2000 is 53 weeks. 13. Includes a $946 million net gain on the sales of assets and a $59 million pretax bankruptcy recovery. 14. Includes a $37 million pretax charge for restructuring, impairment and other charges, an $89 million net loss on the sales of assets, a $769 million net reorganization charge, a $4 million pretax bankruptcy recovery and a $10 million net loss from discontinued operations. The 2003 net loss was $628 million. 15. Includes a $12 million net loss from discontinued operations. The 2000 net loss was $268 million. 16. After preferred dividends of $12 million in 2004 and $25 million in 2003; includes net losses from discontinued operations of $143 million in 2004 and $1.3 billion in 2003. The net loss in 2003 was $953 million. 17. Includes a $488 million pretax restructuring charge, a $318 million income tax benefit, $159 million in net income from discontinued operations and a $296 million net loss on the sale of discontinued operations. The net loss in 2000 was $705 million. 18. Includes pretax restructuring and other charges of $4 million in 2004 and $63 million in 2003. 2004 also includes a $59 million income tax benefit. 19. Includes a $9.2 million pretax special charge, a $114.6 million pretax restructuring charge, a $29 million income tax benefit, $1.6 million in net income from discontinued operations and a $32.6 million net gain on the sale of discontinued operations. The net loss in 2000 was $15.8 million. 20. Excludes licensed department rentals and other income of $13.2 million in 2004, $12.8 million in 2003 and $13.4 million in 2000.
Wal-Mart	1/31/2005	$10,267,000	13.4%1	68.7%	3.6%	20.8%	$285,222,0002	11.3%2	57.8%	3.0%3	22.9%	7.8x
Target	1/29/2005	3,198,0004,R	76.85,R	153.0R	7.0	24.5	45,682,0006	11.66	25.66	0.0	31.2	6.3
Sears, Roebuck	1/1/2005	(507,000)7	—8	—9	-1.4	-8.3	35,718,00010	-1.810	-1.811	-1.4	27.2	4.8
Kmart12	1/26/2005	1,106,00013	—14	—15	5.6	24.7	19,701,000	-15.3	-43.8	-11.0	25.5	4.5
J.C. Penney	1/29/2005	512,00016	—16	—17	2.8	10.5	18,424,000	3.6	-42.1	5.0	38.7	3.6
Toys "R" Us	1/29/2005	252,00018,R	300.018,R	-35.1	2.3	5.8	11,100,000	-1.9	-2.0	-3.7	32.4	3.8
Bed Bath & Beyond	2/26/2005	504,964	26.4	193.7	9.8	22.9	5,147,678	15.0	114.8	4.5	42.5	2.7
ShopKo Stores	1/29/2005	43,338	10.8	—19	1.4	6.8	3,166,64520	-0.520	-10.020	-0.4	26.2	4.1
Linens 'n Things	1/1/2005	60,521	-16.8R	-2.9R	2.3	7.5	2,661,469	11.1	69.2	1.8	40.3	2.2