MINNEAPOLIS — With its stores north of the border struggling to achieve profitability, Target Corp. has begun efforts to discontinue its Canadian operations.

The discount store retailer said Thursday that its subsidiary Target Canada Co. has filed an application for protection under the Companies’ Creditors Arrangement Act (CCAA) with the Ontario Superior Court of Justice (Commercial List) in Toronto. The court granted the order for credit protection soon after Target’s announcement Thursday morning.

Target Canada, which opened its first stores in 2013, has 133 stores across the country and employs about 17,600 people. In early 2011, the company announced its plan to enter the Canadian market with a $1.8 billion deal to buy sites of discount store chain Zellers Inc. from Hudson’s Bay Co.

“After a thorough review of our Canadian performance and careful consideration of the implications of all options, we were unable to find a realistic scenario that would get Target Canada to profitability until at least 2021,” Target Corp. chairman and chief executive officer Brian Cornell said in a statement. “Personally, this was a very difficult decision, but it was the right decision for our company. With the full support of Target Corp.’s board of directors, we have determined that it is in the best interest of our business and our shareholders to exit the Canadian market and focus on driving growth and building further momentum in our U.S. business.”

Target Canada has appointed Alvarez & Marsal Canada as monitor in the CCAA proceedings to oversee the liquidation and wind-down process for Target Canada and its subsidiaries. Target Corp. has received court authorization to provide a $175 million (U.S.) debtor-in-possession credit facility to finance Target Canada’s operations during the CCAA proceedings. Target Canada also has received approval to engage Lazard to advise Target Canada in connection with the sale of its real estate assets.

“The Target Canada team has worked tirelessly to improve the fundamentals, fix operations and build a deeper relationship with our guests. We hoped that these efforts in Canada would lead to a successful holiday season, but we did not see the required step-change in our holiday performance,” Cornell stated. “There is no doubt that the next several weeks will be difficult, but we will make every effort to handle our exit in an appropriate and orderly way.”

Plans call for Target Canada and its subsidiaries to be deconsolidated from Target Corp.’s financial statements as of the date of the filing. Target Corp. said it expects to report approximately $5.4 billion of pretax losses on discontinued operations for its 2014 fourth quarter, mainly due to the writedown of the company’s investment in Target Canada, along with costs associated with exit or disposal activities and quarter-to-date Canadian segment operating losses prior to the filing.

Target Corp. added that it expects to report about $275 million of pretax losses on discontinued operations in fiscal 2015. Target said its cash costs to discontinue Canadian operations are projected to be $500 million to $600 million, most of which will occur in its 2015 fiscal year or later. The company noted that it has sufficient resources to fund these expected costs, including cash on hand and ongoing cash generation by its U.S. business.

Target said it expects the decision to exit Canada to raise its earnings in fiscal 2015 and beyond and to increase its cash flow in fiscal 2016 and thereafter.

The announcement of Target’s departure from Canada hoisted its stock price, as the news of Target Canada’s lingering difficulties had weighed on investors. In late morning trading on Thursday, Target’s share price was up $2.15 to $76.48.

“The good news is that Target will stop throwing good money after bad, and investors have certainty that the downside of Canada is contained,” William Blair & Co. analyst Mark Miller wrote in a research note Thursday. “The bad news is that Target’s long-term growth opportunity is now effectively limited to the United States. With only small domestic store expansion, the focus will shift to the company’s ability to drive comp-sales growth and margin expansion at stores while increasing investment in e-commerce capabilities.”

With the discontinuation of the Canadian operation, Target will operate as a single segment that includes all U.S. operations. Starting with fourth-quarter 2014 financial results, Target will report adjusted earnings per share reflecting operating results from its U.S. operations, excluding discontinued Canadian operations, the impact of the reduction of the beneficial interest asset recognized in connection with the 2013 sale of the company’s U.S. consumer credit card portfolio, net expenses related to the 2013 data breach, and the resolution of certain tax matters.

Overall, Target operates 1,934 stores — 1,801 in the United States and 133 in Canada —  including about 1,660 pharmacies.

In Canada, Target employed a pharmacy franchise model that allowed pharmacist-owners to own and operate pharmacy businesses inside its stores. During the lead-up to the opening of its first Canadian locations, Target said it aimed to operate pharmacies in as many stores in Canada as possible.

In Quebec, Target enlisted Metro Inc. subsidiary McMahon Distributeur Pharmaceutique Inc. to operate pharmacies under its Brunet banner in Target stores. Target Canada announced last May that the first two Brunet Target-affiliated pharmacies opened inside the Brossard and Sainte-Dorothée, Quebec, Target stores. Under the partnership, plans called for 18 pharmacies operated by Brunet-affiliated pharmacist-owners to open at Target stores in Quebec during 2014.