MINNEAPOLIS (AP) - Target Corp. said Wednesday that its board approved the increase of its quarterly dividend by 6 cents, or 20 percent, to 36 cents.
The Minneapolis-based discount chain will pay the dividend on Sept. 10 to shareholders of record as of Aug. 15.
Target Corp. has paid a dividend every quarter since going public in 1967.
The announcement was made ahead of its annual shareholders' meeting, which took place on Wednesday at a soon-to-open store in downtown Chicago. That unit, along with locations in Los Angeles, San Francisco and Seattle, is part of a new breed of smaller format stores designed for urban markets slated to make their debut this summer.
Like most retailers, Target has faced the challenge of trying to find ways of luring cautious U.S. shoppers into stores amid a flood of mixed economic news that has them scrutinizing every purchase. The job and housing markets are still shaky, but lower gas prices have given consumers hope.
Target, which mixes stylish clothes and trendy decor under the same roof as toothpaste and cereal, recently has had success drawing customers into stores with two growth initiatives. It has been offering a larger selection of food, and it launched a program in 2010 that gives shoppers a 5 percent discount when they pay with Target-branded credit and debit cards.
The retailer, which operates 1,763 stores across the U.S., reported last month that its first-quarter profit rose 1.2 percent to $697 million, or $1.04 per share, in the quarter ended April 28. Excluding costs associated with its expansion into Canada next year, per-share results would have been $1.11. Revenue rose 5.9 percent to $16.86 billion.
Revenue at stores open at least a year rose 5.3 percent, the strongest performance in six years for that period. The measure is considered a key indicator of a retailer's health.
Based on the better-than-expected results, Target raised its full-year profit guidance last month by 5 cents, to a range of $4.60 to $4.80 per share.
Target's CEO Gregg Steinhaffel told shareholders Wednesday that the results show that even in an uneven economy, shoppers are willing to splurge on home goods and accessories, if they are stylish and are priced right.
"We continue to build on what we do well," he added.
Target shares fell 11 cents to close at $58.05, near the high end of its 52-week range of $45.28 to $59.40.
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