Business briefs for May 21, 2002

Tuesday, May 21, 2002 | 11:13 a.m.

Grocer beats its own forecast

BOISE, Idaho -- Albertson's Inc. said today it had profit of 55 cents to 58 cents a share in the first quarter ended May 2.

The company said in a statement that it previously forecast earnings of 50 cents a share. Excluding goodwill amortization, profit had been estimated at 53 cents, Albertson's said. Final results will be released on June 5.

Automaker recalls retired executive

DEARBORN, Mich. -- Ford Motor Co. announced a shuffling in its management on Monday, which included bringing back a retired executive to reprise his role as chief financial officer.

In his first news conference as financial officer, Allan D. Gilmour, 67, broke with Ford's criticism of the increase in spending on rebates and other incentives by the Big Three automakers.

Ford and Chrysler have gone along with the price war, driven by General Motors Corp., but have complained about its effect on profits.

"The customers like them," said Gilmour, whose appointment was effective immediately. "Stop whining in public. What that means to the public is 'I wish prices were higher.' "

Discounter picks up business from Kmart

MINNEAPOLIS -- Target Corp.'s first- quarter profit climbed 36 percent as the retailer reduced inventory at its department stores and increased sales at the discount chain.

Net income in the period ended May 4 rose to $345 million, or 38 cents a share, from $254 million, or 28 cents, a year earlier, the company said today. Revenue, including credit fees, increased 15 percent to $9.59 billion from $8.33 billion.

The company said it controlled inventory to avoid profit- eroding discounts. The Target discount stores gained shoppers from Kmart Corp., which filed for bankruptcy protection in January, as it offered exclusive products such as Michael Graves housewares, investors said.

"They have an expertise at keeping the right mix of products in the stores and keeping the shelves stocked appropriately," said George Strietmann, who manages about 368,000 Target shares in Bahl & Gaynor Investment Council's $2 billion in assets.

Big retailer's earnings jump 35 percent

ATLANTA -- Home Depot Inc.'s first- quarter earnings rose 35 percent, more than expected, as the world's largest home-improvement retailer controlled expenses and sold more paint, lumber and gardening products.

Net income rose to $856 million, or 36 cents a share, from $632 million, or 27 cents, a year earlier, the company said today in a statement. Sales in the quarter ended May 5 increased 17 percent to $14.3 billion from $12.2 billion.

Chief Executive Robert Nardelli has pared store growth and sought better prices from suppliers to keep a lid on costs. He also has added services such as power-tool rentals, widening margins, and plans to expand the retailer's appliance departments. Home Depot is wringing more sales out of existing stores because it can no longer rely on expansion to fuel growth, investors said.

Lowe's Cos., the No. 2 home-improvement chain, said Monday that first-quarter profit rose 54 percent. The company also boosted its annual forecast and said second-quarter earnings will top analysts' estimates.