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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
----------------------------
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended January 29, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the Transition period from __________ to __________
Commission File Number 1-6049
DAYTON HUDSON CORPORATION
(Exact name of registrant as specified in its charter)
Minnesota 41-0215170
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
777 Nicollet Mall, Minneapolis, Minnesota 55402
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 612/370-6948
----------------------------
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Name of Each Exchange
Title of Each Class on Which Registered
------------------- ---------------------
Common Stock, par value $1 per share New York Stock Exchange
Pacific Stock Exchange
Preferred Stock Purchase Rights New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: NONE
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes [X] No
----- -----
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [_]
Aggregate market value of the voting stock held by non-affiliates of the
Registrant on March 31, 1994 was $5,604,931,234, based on the closing price
of $73.00 per share of Common Stock as reported on the New York Stock
Exchange -- Composite Index and $935.00 per share of Series B ESOP
Convertible Preferred Stock as determined by Duff & Phelps. (Excluded from
this figure is the voting stock held by Registrant's Directors and Executive
Officers.)
Indicate the number of shares outstanding of each of Registrant's classes of
common stock, as of the latest practicable date. April 1, 1994: 71,548,293
shares of common stock, par value $1.
DOCUMENTS INCORPORATED BY REFERENCE
1. Portions of Registrant's 1993 Annual Report to Shareholders are
incorporated into Parts I and II.
2. Portions of Registrant's Proxy Statement dated April 20, 1994 are
incorporated into Part III.
================================================================================
PART I
ITEM 1. BUSINESS.
--------
Financial Policies and Debt Ratio, Pages 17-18; Capital Expenditures, Page
18; Business Segments, excluding years 1988-1990, Page 21; Quarterly Results,
Page 31; Page 34 and the list of store locations on Page 35 of Registrant's
1993 Annual Report to Shareholders are incorporated herein by reference.
Registrant was incorporated in Minnesota in 1902.
ITEM 2. PROPERTIES.
----------
Leases, Page 25; Long-Term Debt, Page 27 and the list of store locations on
Page 35 of Registrant's 1993 Annual Report to Shareholders are incorporated
herein by reference.
ITEM 3. LEGAL PROCEEDINGS.
-----------------
Paragraph 2 of Commitments and Contingencies, Page 25 of Registrant's 1993
Annual Report to Shareholders is incorporated herein by reference.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS.
---------------------------------------------------
Not Applicable.
ITEM X. EXECUTIVE OFFICERS OF THE REGISTRANT.
------------------------------------
The executive officers of the Registrant as of April 1, 1994 and their
positions and ages, are as follows:
Name Title Age
- ---- ----- ---
Kenneth A. Macke* Chairman of the Board, Chief Executive Officer, 55
Chairman of the Executive Committee and Director of
Registrant
Stephen E. Watson President and Director of Registrant; Chairman and 49
Chief Executive Officer of the Department Store
Division (a division of Registrant)
Henry T. DeNero Vice Chairman 48
James T. Hale Senior Vice President and Secretary 53
Douglas A. Scovanner Senior Vice President and Treasurer 38
Robert J. Ulrich* Chairman and Chief Executive Officer of Target 50
(a division of Registrant) and Director of
Registrant
Joseph C. Vesce Chairman and Chief Executive Officer of Mervyn's 45
(a subsidiary of Registrant)
Edwin H. Wingate Senior Vice President 61
JoAnn Bogdan Controller and Chief Accounting Officer 41
- --------------------
*Mr. Macke was Chief Executive Officer of Registrant until April 13, 1994.
Mr. Ulrich was elected Chief Executive Officer of Registrant on April 13,
1994.
1
Each officer is elected by and serves at the pleasure of the Board of
Directors. There is no family relationship between any of the officers named
nor is there any arrangement or understanding pursuant to which any person
was selected as an officer. The period of service of each officer in the
positions listed and other business experience as of April 1, 1994 is set
forth below.
Kenneth A. Macke Chairman of the Executive Committee of Registrant since
1985, Chairman of the Board of Registrant since 1984 and Chief Executive
Officer of Registrant since 1983.
Stephen E. Watson President of Registrant since 1990. Chairman and Chief
Executive Officer of the Department Store Division from 1985 to 1989 and
since 1991. Executive Vice President of Registrant in 1989.
Henry T. DeNero Vice Chairman of Registrant since 1992. Director of McKinsey
& Company, Inc. (a management consulting firm) from 1985-1992.
James T. Hale Senior Vice President, Secretary and General Counsel of
Registrant since 1981.
Douglas A. Scovanner Senior Vice President and Treasurer of Registrant since
1994. Senior Vice President, Finance of Fleming Companies, Inc. (a food
wholesaler) from 1992 to 1994. Vice President and Treasurer of Coca-Cola
Enterprises, Inc. (a soft drink bottler) from 1986 to 1992.
Robert J. Ulrich Chairman and Chief Executive Officer of Target since 1987.
Joseph C. Vesce Chairman of Mervyn's since 1993. Chief Executive Officer of
Mervyn's since 1992. President of Mervyn's from 1988 to 1993.
Edwin H. Wingate Senior Vice President of Registrant since 1980.
JoAnn Bogdan Controller and Chief Accounting Officer of Registrant since
1993. Assistant Controller of Registrant from 1988 to 1993.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
-----------------------------------------------------------------
MATTERS.
-------
Shareholder Return, Page 18 and Dividends Declared Per Share and Common Stock
Price, Page 31 of Registrant's 1993 Annual Report to Shareholders are
incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA.
-----------------------
The data on years 1989-1993 in the Summary Financial and Operating Data
(excluding Other Data), Page 33; Notes and Analysis, Pages 21, 23, 25, 27 and
29-31 (excluding years 1988-1990 on page 21) and the Report of Independent
Auditors, Page 32 of Registrant's 1993 Annual Report to Shareholders are
incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
---------------------------------------------------------------
RESULTS OF OPERATIONS.
---------------------
Financial Policies and Debt Ratio, Pages 17-18; Capital Expenditures, Page
18; Analysis of Operations, Pages 19-20, paragraph 2 of Income Taxes, Page
23; Commitments and Contingencies, Page 25; Analysis of Cash Flow and Lines
of Credit, Page 27; the fourth texual paragraph of Pension Plans, Page 29;
the second and third texual paragraphs of Postretirement Health Care
Benefits, Page 30 and LIFO Provision, Page 31 of Registrant's 1993 Annual
Report to Shareholders are incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
-------------------------------------------
Pages 21-31 and 33 (excluding years 1988-1990 on Page 21 and years 1983-1988
and Other Data in the Summary Financial and Operating Data on Page 33) and
the Report of Independent Auditors, Page 32 of Registrant's 1993 Annual
Report to Shareholders are incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
---------------------------------------------------------------
FINANCIAL DISCLOSURE.
--------------------
Not Applicable.
2
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
--------------------------------------------------
Election of Directors, Pages 1-6 and Compliance with Section 16(a) of the
Securities Exchange Act of 1934, Page 28 of Registrant's Proxy Statement
dated April 20, 1994, is incorporated herein by reference. See also Item X of
Part I hereof.
ITEM 11. EXECUTIVE COMPENSATION.
----------------------
Executive Compensation, Pages 7-13 and Director Compensation, Pages 17-18 of
Registrant's Proxy Statement dated April 20, 1994, are incorporated herein by
reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
--------------------------------------------------------------
Outstanding Shares and Voting Rights, Pages 26-28 of Registrant's Proxy
Statement dated April 20, 1994, is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
----------------------------------------------
Not Applicable.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
----------------------------------------------------------------
a) FINANCIAL STATEMENTS:
Consolidated Results of Operations for the Years Ended January 29, 1994,
January 30, 1993 and February 1, 1992.
Consolidated Statements of Financial Position at January 29, 1994 and
January 30, 1993.
Consolidated Statements of Cash Flows for the Years Ended January 29, 1994,
January 30, 1993 and February 1, 1992.
Consolidated Statements of Common Shareholders' Investment for the Years
Ended January 29, 1994, January 30, 1993 and February 1, 1992.
Information which is an integral part of the financial statements: Notes and
Analysis on Pages 21, 23, 25, 27 and 29-31, excluding years 1988-1990 on Page
21, and the Report of Independent Auditors on Page 32 in Registrant's 1993
Annual Report to Shareholders.
FINANCIAL STATEMENT SCHEDULES:
For the Years Ended January 29, 1994, January 30, 1993 and February 1, 1992
V - Property and Equipment
VI - Accumulated Depreciation of Property and Equipment
VIII - Valuation and Qualifying Accounts
IX - Short-Term Borrowings
X - Supplementary Income Statement Information
b) REPORTS ON FORM 8-K
Not Applicable.
3
c) EXHIBITS
(2) Not Applicable
(3)A. Articles of Incorporation
Incorporated by reference to Exhibit (3)A. to Registrant's Form 10-K Report
for the year ended January 30, 1993 ("1993 10-K").
B. By-Laws
Incorporated by reference to Exhibit (3)B. to Registrant's 1993 10-K.
(4) Instruments defining the rights of security holders, including indentures.
Registrant agrees to furnish the Commission on request copies of instruments
with respect to long-term debt.
(9) Not Applicable
(10)A. Executive Incentive Plan (PTOC) (a)
B. Executive Incentive Plan (ROI) (b)
C. Executive Incentive Plan (Personal Score)
D. Excess Benefit Plan (c)
E. Excess Benefit Plan II (d)
F. Executive Long-Term Incentive Plan of 1981, as amended
and restated. Amendment dated April 14, 1993 (e)
G. Supplemental Pension Plan I (f)
H. Supplemental Pension Plan II (g)
I. Deferred Compensation Plan (h)
J. Deferred Compensation Plan for Directors (i)
K. Income Continuance Policy (j)
L. SMG Income Continuance Policy (k)
(11) Statements re Computation of Per Share Earnings
(12) Computations of Ratios
(13) 1993 Annual Report to Shareholders (only those portions specifically
incorporated by reference herein shall be deemed filed with the Commission)
(18) Letter re Change in Accounting Principles
(19) Not Applicable
(21) List of Subsidiaries
(22) Not Applicable
(23) Consent of Independent Auditors
(24) Powers of Attorney
(28) Not Applicable
(29) Not Applicable
(99)(I) Registrant's 11-K Report (filed under Form SE)
(II) Registrant's Proxy Statement dated April 20, 1994 (only those portions
specifically incorporated by reference shall be deemed filed with the
Commission) (l)
(III) Schedule of Operating Profit and LIFO Provision
Copies of Exhibits (10)A.-(10)L., (21), (99)(I) and (99)(III) will be furnished
upon written request and payment of Registrant's reasonable expenses in
furnishing the exhibits.
4
(a) Incorporated by reference to Exhibit A to Registrant's Proxy Statement dated April 20, 1994.
(b) Incorporated by reference to Exhibit B to Registrant's Proxy Statement dated April 20, 1994.
(c) Incorporated by reference to Exhibit (10)D. to Registrant's 1993 10-K.
(d) Incorporated by reference to Exhibit (10)E. to Registrant's 1993 10-K.
(e) Incorporated by reference to Exhibit (10)F. to Registrant's 1993 10-K.
(f) Incorporated by reference to Exhibit (10)G. to Registrant's 1993 10-K.
(g) Incorporated by reference to Exhibit (10)H. to Registrant's 1993 10-K.
(h) Incorporated by reference to Exhibit (10)I. to Registrant's 1993 10-K.
(i) Incorporated by reference to Exhibit (10)J. to Registrant's 1993 10-K.
(j) Incorporated by reference to Exhibit (10)A. to Registrant's 1993 10-K.
(k) Incorporated by reference to Exhibit (10)B. to Registrant's 1993 10-K.
(l) Incorporated by reference to Registrant's Proxy Statement dated April 20, 1994
(only those portions specifically incorporated by reference shall be deemed filed with the Commission).
5
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
DAYTON HUDSON CORPORATION
By /s/ Henry T. DeNero
--------------------------
Henry T. DeNero
Vice Chairman and Chief Financial Officer
Dated: April 19, 1994
Pursuant to the requirements of the Securities Exchange Act of 1934, the
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
/s/ Bob Ulrich
-------------------------
Robert J. Ulrich
Dated: April 19, 1994 Chief Executive Officer
/s/ Henry T. DeNero
-------------------------
Henry T. DeNero
Vice Chairman and
Dated: April 19, 1994 Chief Financial Officer
/s/ J.A. Bogdan
-------------------------
JoAnn Bogdan
Controller and
Dated: April 19, 1994 Chief Accounting Officer
RAND V. ARASKOG MICHELE J. HOOPER
ROBERT A. BURNETT KENNETH A. MACKE
LIVIO D. DESIMONE MARY PATTERSON MCPHERSON
ROGER A. ENRICO ROBERT J. ULRICH
WILLIAM W. GEORGE JOHN R. WALTER
ROGER L. HALE STEPHEN E. WATSON Directors
BETTY RUTH HOLLANDER
Henry T. DeNero, by signing his name hereto, does hereby sign this document
pursuant to powers of attorney duly executed by the Directors named, filed
with the Securities and Exchange Commission on behalf of such Directors, all
in the capacities and on the date stated, such persons being a majority of
the Directors of the Registrant.
By /s/ Henry T. DeNero
----------------------------
Henry T. DeNero
Dated: April 19, 1994 Attorney-in-Fact
6
DAYTON HUDSON CORPORATION AND SUBSIDIARIES
SCHEDULE V - PROPERTY AND EQUIPMENT
FISCAL YEARS 1993, 1992 AND 1991
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
- -------- ---------- --------- ----------- -------- ----------
BALANCE AT BALANCE AT
BEGINNING (1) OTHER END OF
CLASSIFICATION OF PERIOD ADDITIONS RETIREMENTS CHANGES PERIOD
- -------------- ---------- --------- ----------- -------- ----------
1993:
Land......................... $ 998 $ 130 $ 8 $- $1,120
Buildings and Improvements... 4,342 460 49 - 4,753
Fixtures and Equipment....... 2,197 363 398 - 2,162
Construction-in-Progress..... 223 25 - - 248
------ ------ ---- --- ------
$7,760 $ 978 $455 $- $8,283
====== ====== ==== === ======
1992:
Land......................... $ 897 $ 105 $ 4 $- $ 998
Buildings and Improvements... 3,883 473 14 - 4,342
Fixtures and Equipment....... 1,983 335 121 - 2,197
Construction-in-Progress..... 198 25 - - 223
------ ------ ---- --- -------
$6,961 $ 938 $139 $- $7,760
====== ====== ==== === =======
1991:
Land......................... $ 723 $ 175 $ 1 $- $ 897
Buildings and Improvements... 3,455 466 38 - 3,883
Fixtures and Equipment....... 1,745 387 149 - 1,983
Construction-in-Progress..... 210 (12) - - 198
------ ------ ---- --- ------
$6,133 $1,016 $188 $- $6,961
====== ====== ==== === ======
- -------------------------
(1) Represents acquisitions of fixed assets and additions to and transfers from
construction-in-progress.
7
DAYTON HUDSON CORPORATION AND SUBSIDIARIES
SCHEDULE VI - ACCUMULATED DEPRECIATION OF PROPERTY AND EQUIPMENT
FISCAL YEARS 1993, 1992 AND 1991
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
- -------- ---------- ---------- ----------- --------- ----------
ADDITIONS
BALANCE AT CHARGED TO BALANCE AT
BEGINNING COSTS AND OTHER END OF
CLASSIFICATION OF PERIOD EXPENSES RETIREMENTS CHANGES PERIOD
- -------------- ---------- ---------- ----------- --------- ----------
1993:
Buildings and Improvements..... $1,125 $200 $ 37 $- $1,288
Fixtures and Equipment......... 1,072 298 322 - 1,048
------ ---- ---- --- ------
$2,197 $498 $359 $- $2,336
====== ==== ==== === ======
1992:
Buildings and Improvements..... $ 950 $183 $ 8 $- $1,125
Fixtures and Equipment......... 909 276 113 - 1,072
------ ---- ---- --- ------
$1,859 $459 $121 $- $2,197
====== ==== ==== === ======
1991:
Buildings and Improvements..... $ 800 $161 $ 11 $- $ 950
Fixtures and Equipment......... 808 249 148 - 909
------ ---- ---- --- ------
$1,608 $410 $159 $- $1,859
====== ==== ==== === ======
- ------------------------
Depreciation is computed using the straight-line method and the following
lives:
Land improvements....................... 20 years
Buildings and building improvements..... 8 to 55 years
Leasehold improvements.................. Lease term or useful life of asset, whichever is less
Fixtures and equipment.................. 3 to 8 years
8
DAYTON HUDSON CORPORATION AND SUBSIDIARIES
SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS
FISCAL YEARS 1993, 1992 AND 1991
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
- -------- ---------- --------- ---------- ----------
ADDITIONS
BALANCE AT CHARGED TO BALANCE AT
BEGINNING COSTS AND (1) END OF
DESCRIPTIONS OF PERIOD EXPENSES DEDUCTIONS PERIOD
- ------------ ---------- --------- ---------- ----------
Allowance for Doubtful Accounts
1993............................ $37 $53 $55 $35
1992............................ 46 56 65 37
1991............................ 44 65 63 46
- --------------------------
(1) Accounts determined to be uncollectible are charged against reserve, net of
collections on accounts previously charged against reserve.
9
DAYTON HUDSON CORPORATION AND SUBSIDIARIES
SCHEDULE IX - SHORT-TERM BORROWINGS
FISCAL YEARS 1993, 1992 AND 1991
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
- -------- ---------- ------------- ----------- ----------- -------------
MAXIMUM AVERAGE WEIGHTED
AMOUNT AMOUNT AVERAGE
BALANCE AT WEIGHTED OUTSTANDING OUTSTANDING INTEREST RATE
CATEGORY OF AGGREGATE END OF AVERAGE DURING DURING DURING
SHORT-TERM BORROWINGS PERIOD INTEREST RATE THE PERIOD THE PERIOD THE PERIOD
- --------------------- ---------- ------------- ----------- ---------- -----------
1993:
Commercial paper $200 3.0% $ 896 $298 3.2%
Short-term bank
borrowings - - - - -
1992:
Commercial paper (1) $223 3.1% $1,211 $460 3.7%
Short-term bank
borrowings - - 41 5 4.2%
1991:
Commercial paper (1) $465 4.2% $ 941 $365 5.7%
Short-term bank
borrowings - - 220 37 5.5%
- -------------------------------
(1) $200 million of the commercial paper outstanding at the end of 1992 and 1991
was classified as long-term debt in the Consolidated Statements of Financial
Position, as explained in the Commercial Paper note in Registrant's 1993
Annual Report to Shareholders.
10
DAYTON HUDSON CORPORATION AND SUBSIDIARIES
SCHEDULE X - SUPPLEMENTARY INCOME STATEMENT INFORMATION
FISCAL YEARS 1993, 1992 AND 1991
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B
- -------- ---------------------
1993 1992 1991
---- ---- ----
CHARGED TO COSTS AND
EXPENSES
---------------------
Taxes other than income taxes (1)
Real and personal property taxes. $141 $125 $110
Payroll taxes.................... 190 178 164
Other............................ 12 10 9
--- --- ---
$343 $313 $283
Advertising costs................. $494 $437 $423
Included in Revenues
----------------------
Sales by leased departments....... $165 $163 $153
Finance charge revenue............ 192 186 182
- ----------------------
(1) Taxes paid as Lessee in accordance with certain lease agreements have been
included in cost of retail sales, buying and occupancy and are not included
herein.
Amounts for maintenance and repairs, depreciation and amortization of
intangible assets, pre-operating costs and similar deferrals, and royalties
are not presented as such amounts are less than 1% of total revenues.
11