[Commerce Seal]

UNITED STATES BUREAU OF THE CENSUS

Economic and Statistics Administration, U.S. Department of Commerce


ADVANCE DATA ON LARGE RETAILERS` PROFITS FOR THE SECOND QUARTER 1996

October 1996--Released 10A.M. EDT, October 16, 1996 (CB-96-171)
Contact: Ronald H. Lee (301) 763-5435 or Frank Hartman (301) 763-7182.

NOTICE OF CHANGE--Beginning November 15, 1996, this document will not be available on CENDATA, FASTFAX or the Census/BEA Forum. This document and future releases can be retrieved from the Census Bureau`s World-Wide-Web site, (http://www.census.gov/ftp/pub/csd/www/qfr.html).

This report is available on the day of issue through the Department of Commerce`s on-line Economic Bulletin Board (N-8-1) (202-377-3870) and through the Census Bureau`s on-line information service--CENDATA. Further information about accessing CENDATA can be obtained from Dialog Information Services, Inc. (1-800-334-2564) and CompuServe (1-800-848-8199). The CENDATA staff at the Bureau of the Census (301-457-1214) can provide content information and general guidance.

[Large Retailers' After-Tax Profits.]
After-tax profits for retail corporations with assets of $50 million and over averaged 1.7 cents per dollar of sales for the second quarter of 1996, up 0.4 (+/-0.18) cents from the preceding quarter, but the same as a year ago, according to advance data from the Commerce Department`s Bureau of the Census.

For the second quarter of 1996, these large retail corporations reported after-tax profits of $3.9 billion, up $1.0 (+/-0.2) billion from the preceding quarter, and up $0.2 (+/-0.2) billion from the same quarter a year ago. The annual rate of after-tax return on stockholders` equity was 10.0 percent, compared to 7.5 percent in the first quarter of 1996, and 10.1 percent in the second quarter of 1995.

Second quarter 1996 sales were $233.3 billion, up $7.9 billion or 3.5 (+/-1.8) percent from last quarter. First quarter sales compared to the same quarter a year ago were up $14.8 billion or 6.8 (+/-2.0) percent.

These data are based on quarterly financial reports obtained from 546 corporations. The figures in this release are not seasonally adjusted. More detailed information on the retail trade sector for the second quarter will be published in the Quarterly Financial Report for Manufacturing, Mining, and Trade Corporations--Third Quarter 1996 which is scheduled for release on December 16, 1996.

EXPLANATORY NOTES:

This quarter`s publication contains data revised due to the reclassification of corporations by industry, and revisions that reflect respondents` corrections of submitted data subsequent to original publication.

A statement such as "up 2.5 (+/-0.15) cents," appearing in the text, indicates the range (+2.35 to +2.65 cents) in which the actual change is likely to have occurred. The range given for the change is a 90 percent confidence interval that accounts only for sampling variability. If the range had contained zero (0), it would have been uncertain whether there was an increase or decrease; that is, the change would not have been statistically significant. For any comparison cited without a confidence interval, the change is statistically significant. The quarterly publication includes more detailed explanations of confidence intervals and sampling variability, along with additional measures of sampling variability.

TABLE 1. INCOME STATEMENT FOR RETAIL TRADE CORPORATIONS WITH ASSETS OF $50 MILLION AND OVER* 
                                                     2Q      1Q       2Q
                                                   1996    1996(1)  1995(1)
                                                      (million dollars)

Net sales, receipts, and operating revenues.... 233,253  225,342  218,442
Less: Depreciation, depletion, and amortization   4,858    4,689    4,536
Less: All other operating costs and expenses... 219,460  213,191  205,989
                                                
  Income (or loss) from operations.............   8,935    7,462    7,917

Net nonoperating income (expense).............. (2,498)  (2,609)  (1,982)


  Income (or loss) before income taxes.........   6,437    4,852    5,935

Less: Provision for current and deferred         
  domestic income taxes........................   2,571    2,015    2,314

  Income (or loss) after income taxes..........   3,866    2,838    3,621
                                                 
Cash dividends charged to retained earnings
  in current quarter.......................       1,204    1,078    1,423  

  Net income retained in business..............   2,662    1,760    2,198

Retained earnings at beginning of quarter......  99,038   98,074   95,908
Other direct credits (or charges) to             
  retained earnings (net)......................   (834)    (506)  (7,614)

Retained earnings at end of quarter............ 100,866   99,328   90,492
*Beginning in the fourth quarter of 1995 retail trade companies with assets of less than $250 million are being sampled on a less than 1:1 ratio. To provide comparability, data for the second quarter of 1995 have been restated to reflect this change.

(1) Revised.

SOURCE: Quarterly Financial Report for Manufacturing, Mining, and Trade Corporations--QFR-96-3.

TABLE 2. INCOME STATEMENT IN RATIO FORMAT FOR RETAIL TRADE CORPORATIONS WITH ASSETS OF $50 MILLION AND OVER* 
                                                     2Q     1Q       2Q
                                                   1996   1996(1)  1995(1)
                                                          (cents)

Net sales, receipts, and operating revenues....   100.0   100.0    100.0
Less: Depreciation, depletion, and amortization     2.1     2.1      2.1
Less: All other operating costs and expenses...    94.1    94.6     94.3
                                                   
  Income (or loss) from operations.............     3.8     3.3      3.6
                                                  
Net nonoperating income (expense)..............   (1.1)   (1.2)    (0.9)
                                                  
  Income (or loss) before income taxes.........     2.8     2.2      2.7
                                                  
Less: Provision for current and deferred            
  domestic income taxes........................     1.1     0.9      1.1 
                                                    
  Income (or loss) after income taxes..........     1.7     1.3      1.7
*Beginning in the fourth quarter of 1995 retail trade companies with assets of less than $250 million are being sampled on a less than 1:1 ratio. To provide comparability, data for the second quarter of 1995 have been restated to reflect this change.

(1) Revised.

SOURCE: Quarterly Financial Report for Manufacturing, Mining, and Trade Corporations--QFR-96-3.

TABLE 3. OPERATING RATIOS FOR RETAIL TRADE CORPORATIONS WITH ASSETS OF $50 MILLION AND OVER* 
                                                     2Q      1Q       2Q
                                                   1996    1996(1)  1995(1)
                                                          (percent)

Annual rate of profit on stockholders` equity
  at end of period:
    Before income taxes.........................  16.57   12.78    16.53
    After income taxes..........................   9.95    7.47    10.08

Annual rate of profit on total assets:                                  
Before income taxes.........................       5.62    4.26     5.45
    After income taxes..........................   3.38    2.49     3.33
*Beginning in the fourth quarter of 1995 retail trade companies with assets of less than $250 million are being sampled on a less than 1:1 ratio. To provide comparability, data for the second quarter of 1995 have been restated to reflect this change.

(1) Revised.

SOURCE: Quarterly Financial Report for Manufacturing, Mining, and Trade Corporations--QFR-96-3.

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