Kohl's (KSS) 10-Q 6 Jun 14 2014 Q1 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	3 Months Ended
	3-May-14
Document and Entity Information [Abstract]	'
Entity Registrant Name	'KOHLS CORP
Entity Central Index Key	'0000885639
Current Fiscal Year End Date	'--01-31
Entity Filer Category	'Large Accelerated Filer
Trading Symbol	'KSS
Document Type	'10-Q
Document Period End Date	3-May-14
Document Fiscal Year Focus	'2014
Document Fiscal Period Focus	'Q1
Amendment Flag	'false
Entity Common Stock, Shares Outstanding	209,309,047

CONSOLIDATED_BALANCE_SHEETS

CONSOLIDATED BALANCE SHEETS (USD $)	3-May-14	Feb. 01, 2014	4-May-13
In Millions, unless otherwise specified
Current assets:	'	'	'
Cash and cash equivalents	$717	$971	$518
Merchandise inventories	3,981	3,874	3,961
Deferred income taxes	137	142	138
Other	280	305	294
Total current assets	5,115	5,292	4,911
Property and equipment, net	8,677	8,745	8,822
Other assets	341	341	317
Total assets	14,133	14,378	14,050
Current liabilities:	'	'	'
Accounts payable	1,382	1,365	1,452
Accrued liabilities	1,078	1,138	1,023
Income taxes payable	49	94	117
Current portion of capital lease and financing obligations	112	139	107
Total current liabilities	2,621	2,736	2,699
Long-term debt	2,792	2,792	2,492
Capital lease and financing obligations	1,919	1,930	1,938
Deferred income taxes	382	382	368
Other long-term liabilities	562	560	532
Shareholders’ equity:	'	'	'
Common stock	4	4	4
Paid-in capital	2,612	2,598	2,463
Treasury stock, at cost	-8,232	-8,052	-7,354
Accumulated other comprehensive loss	-33	-34	-40
Retained earnings	11,506	11,462	10,948
Total shareholders’ equity	5,857	5,978	6,021
Total liabilities and shareholders’ equity	$14,133	$14,378	$14,050

CONSOLIDATED_STATEMENTS_OF_INC

CONSOLIDATED STATEMENTS OF INCOME (USD $)	3 Months Ended
In Millions, except Per Share data, unless otherwise specified	3-May-14	4-May-13
Net sales	$4,070	$4,199
Cost of merchandise sold	2,574	2,671
Gross margin	1,496	1,528
Operating expenses:	'	'
Selling, general and administrative	1,000	997
Depreciation and amortization	216	214
Operating income	280	317
Interest expense, net	85	83
Income before income taxes	195	234
Provision for income taxes	70	87
Net income	$125	$147
Net income per share:	'	'
Basic (in dollars per share)	$0.60	$0.66
Diluted (in dollars per share)	$0.60	$0.66
Dividends declared and paid per share	$0.39	$0.35

CONSOLIDATED_STATEMENTS_OF_COM

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $)	3 Months Ended
In Millions, unless otherwise specified	3-May-14	4-May-13
Statement of Comprehensive Income [Abstract]	'	'
Net income	$125	$147
Other comprehensive income, net of tax:	'	'
Unrealized gains on investments	0	4
Reclassification adjustment for interest expense on interest rate derivative included in net income	1	1
Other comprehensive income	1	5
Comprehensive income	$126	$152

CONSOLIDATED_STATEMENT_OF_CHAN

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (USD $)	Total	Common Stock	Paid-In Capital	Treasury Stock	Accumulated Other Comprehensive Income (Loss)	Retained Earnings [Member]
In Millions
Beginning Balance at Feb. 01, 2014	$5,978	$4	$2,598	($8,052)	($34)	$11,462
Beginning Balance (in shares) at Feb. 01, 2014	'	364	'	-153	'	'
Comprehensive income (loss)	126	'	'	'	1	'
Net income	125	'	'	'	'	125
Stock options and awards, (in shares)	'	1	'	'	'	'
Stock options and awards	0	'	14	'	'	'
Stock Issued During Period, Value, Stock Options Exercised	'	'	'	-14	'	'
Dividends paid ($0.39 per common share)	-80	'	0	1	'	-81
Treasury stock purchases, (in shares)	'	'	'	-4	'	'
Treasury stock purchases	-167	'	'	-167	'	'
Ending Balance at May. 03, 2014	$5,857	$4	$2,612	($8,232)	($33)	$11,506
Ending Balance (in shares) at May. 03, 2014	'	365	'	-157	'	'

CONSOLIDATED_STATEMENT_OF_CHAN1

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) (USD $)	3 Months Ended
	3-May-14	4-May-13
Statement of Stockholders' Equity [Abstract]	'	'
Dividends declared and paid per share	$0.39	$0.35

CONSOLIDATED_STATEMENTS_OF_CAS

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	3 Months Ended
In Millions, unless otherwise specified	3-May-14	4-May-13
Operating activities	'	'
Net income	$125	$147
Adjustments to reconcile net income to net cash provided by operating activities:	'	'
Depreciation and amortization	216	214
Share-based compensation	11	9
Excess tax benefits from share-based compensation	-2	-1
Deferred income taxes	5	-13
Other non-cash revenues and expenses	5	11
Changes in operating assets and liabilities:	'	'
Merchandise inventories	-105	-210
Other current and long-term assets	17	21
Accounts payable	17	145
Accrued and other long-term liabilities	-44	11
Income taxes	-66	-29
Net cash provided by operating activities	179	305
Investing activities	'	'
Acquisition of property and equipment	-176	-135
Other	4	12
Net cash used in investing activities	-172	-123
Financing activities	'	'
Treasury stock purchases	-167	-101
Shares withheld for taxes on vested restricted shares	-14	-8
Dividends paid	-80	-77
Proceeds from financing obligations	3	0
Capital lease and financing obligation payments	-29	-24
Proceeds from stock option exercises	24	8
Excess tax benefits from share-based compensation	2	1
Net cash used in financing activities	-261	-201
Net decrease in cash and cash equivalents	-254	-19
Cash and cash equivalents at beginning of period	971	'
Cash and cash equivalents at end of period	717	518
Supplemental information:	'	'
Interest paid, net of capitalized interest	65	61
Income taxes paid	132	128
Non-Cash Investing and Financing Activities	'	'
Property and equipment acquired through additional liabilities	$6	$23

Basis_of_Presentation

Basis of Presentation	3 Months Ended
	3-May-14
Organization, Consolidation and Presentation of Financial Statements [Abstract]	'
Business and Summary of Accounting Policies	'
	Basis of Presentation
	The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for fiscal year end financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. For further information, refer to the financial statements and related footnotes included in our Annual Report on Form 10-K for the fiscal year ended February 1, 2014 (Commission File No. 1-11084) as filed with the Securities and Exchange Commission on March 21, 2014.
	Due to the seasonality of our business, results for any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year. In addition, quarterly results of operations may be impacted by the timing and amount of sales and costs associated with the opening of new stores.
	We operate as a single business unit.
	In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition.  This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.  We are required to adopt the new pronouncement in the first quarter of fiscal 2017 using one of two retrospective application methods. We are evaluating the application method and the impact of this new statement on our financial statements.

Debt

Debt	3 Months Ended
	3-May-14
Debt [Abstract]	'
Debt	'
	Debt
	Long-term debt consists of the following unsecured senior debt:
						Outstanding
	Maturity	Effective		Coupon Rate		3-May-14			May 4, 2013
		Rate				and
						1-Feb-14
						(Dollars in Millions)
	2017	6.31	%	6.25	%	$	650		$	650
	2021	4.81	%	4	%	650			650
	2023	3.25	%	3.25	%	350			350
	2023	4.78	%	4.75	%	300			—
	2029	7.36	%	7.25	%	200			200
	2033	6.05	%	6	%	300			300
	2037	6.89	%	6.88	%	350			350
		5.54	%			2,800			2,500
	Unamortized debt discount					(8		)	(8		)
	Long-term debt					$	2,792		$	2,492

Fair_Value_Measurements

Fair Value Measurements	3 Months Ended
	3-May-14
Fair Value Disclosures [Abstract]	'
Fair Value Measurements	'
	Fair Value Measurements
	ASC No. 820, “Fair Value Measurements and Disclosures,” requires fair value measurements be classified and disclosed in one of the following pricing categories:
	Level 1:		Financial instruments with unadjusted, quoted prices listed on active market exchanges.
	Level 2:		Financial instruments lacking unadjusted, quoted prices from active market exchanges, including over-the-counter traded financial instruments. The prices for the financial instruments are determined using prices for recently traded financial instruments with similar underlying terms as well as directly or indirectly observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals.
	Level 3:		Financial instruments that are not actively traded on a market exchange. This category includes situations where there is little, if any, market activity for the financial instrument. The prices are determined using significant unobservable inputs or valuation techniques.
	The following table summarizes our financial instruments:
				May 3, 2014				February 1, 2014				May 4, 2013
		Pricing Category		Cost		Fair Value		Cost		Fair Value		Cost		Fair Value
				(In Millions)
	Cash and cash equivalents	Level 1		$	717	$	717	$	971	$	971	$	518	$	518
	Auction rate securities	Level 3		82		64		82		64		82		57
	Debt	Level 1		2,792		3,082		2,792		2,988		2,492		2,802
	Our investments in auction rate securities (“ARS”) are included in other long-term assets in our balance sheet. There have been no changes to the valuation methodology and no ARS activity since February 1, 2014.

StockBased_Compensation

Stock-Based Compensation	3 Months Ended
	3-May-14
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]	'
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]	'
	Stock-Based Compensation
	The following table summarizes stock-based compensation grants:
		Three Months Ended
		May 3,		May 4,
		2014		2013
		(In Thousands)
	Stock options granted	126		414
	Restricted shares and units granted, excluding shares earned in lieu of cash dividends	730		654
	Total stock-based compensation grants	856		1,068
	Weighted average fair value at grant date:
	Stock options	$	12.68	$	10.18
	Restricted shares and units	$	56.75	$	46.39

Contingencies

Contingencies	3 Months Ended
	3-May-14
Commitments and Contingencies Disclosure [Abstract]	'
Contingencies	'
	Contingencies
	We are subject to certain legal proceedings and claims arising out of the conduct of our business. In the opinion of management, the outcome of these proceedings and litigation will not have a material adverse impact on our consolidated financial statements.

Net_Income_Per_Section

Net Income Per Section	3 Months Ended
	3-May-14
Net Income Per Section [Abstract]	'
Earnings Per Share	'
	Net Income Per Share
	The following table summarizes our basic and diluted net income per share calculations:
		Three Months Ended
		May 3,		May 4,
		2014		2013
		(In Millions)
	Numerator—Net income	$	125	$	147
	Denominator—Weighted average shares:
	Basic	206		222
	Impact of dilutive employee stock-based awards	2		1
	Diluted	208		223
	Antidilutive shares	7		12

Debt_Tables

Debt (Tables)	3 Months Ended
	3-May-14
Debt Disclosure [Abstract]	'
Components of long-term debt	'
	Long-term debt consists of the following unsecured senior debt:
						Outstanding
	Maturity	Effective		Coupon Rate		3-May-14			May 4, 2013
		Rate				and
						1-Feb-14
						(Dollars in Millions)
	2017	6.31	%	6.25	%	$	650		$	650
	2021	4.81	%	4	%	650			650
	2023	3.25	%	3.25	%	350			350
	2023	4.78	%	4.75	%	300			—
	2029	7.36	%	7.25	%	200			200
	2033	6.05	%	6	%	300			300
	2037	6.89	%	6.88	%	350			350
		5.54	%			2,800			2,500
	Unamortized debt discount					(8		)	(8		)
	Long-term debt					$	2,792		$	2,492

Fair_Value_Measurements_Tables

Fair Value Measurements (Tables)	3 Months Ended
	3-May-14
Fair Value Disclosures [Abstract]	'
Summary of Financial Instruments	'
	The following table summarizes our financial instruments:
			May 3, 2014				February 1, 2014				May 4, 2013
		Pricing Category	Cost		Fair Value		Cost		Fair Value		Cost		Fair Value
			(In Millions)
	Cash and cash equivalents	Level 1	$	717	$	717	$	971	$	971	$	518	$	518
	Auction rate securities	Level 3	82		64		82		64		82		57
	Debt	Level 1	2,792		3,082		2,792		2,988		2,492		2,802
Long-Term Investments	'

StockBased_Compensation_Tables

Stock-Based Compensation (Tables)	3 Months Ended
	3-May-14
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]	'
Summary of stock option activity	'
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block]	'
	The following table summarizes stock-based compensation grants:
		Three Months Ended
		May 3,		May 4,
		2014		2013
		(In Thousands)
	Stock options granted	126		414
	Restricted shares and units granted, excluding shares earned in lieu of cash dividends	730		654
	Total stock-based compensation grants	856		1,068
	Weighted average fair value at grant date:
	Stock options	$	12.68	$	10.18
	Restricted shares and units	$	56.75	$	46.39

Net_Income_Per_Section_Net_Inc

Net Income Per Section Net Income Per Section (Tables)	3 Months Ended
	3-May-14
Net Income Per Section [Abstract]	'
Basic and diluted net income per share calculation	'
	The following table summarizes our basic and diluted net income per share calculations:
		Three Months Ended
		May 3,		May 4,
		2014		2013
		(In Millions)
	Numerator—Net income	$	125	$	147
	Denominator—Weighted average shares:
	Basic	206		222
	Impact of dilutive employee stock-based awards	2		1
	Diluted	208		223
	Antidilutive shares	7		12

Debt_Components_of_Long_Term_D

Debt - Components of Long Term Debt (Details) (USD $)	3-May-14	Feb. 01, 2014	4-May-13
In Millions, unless otherwise specified
Debt Instrument [Line Items]	'	'	'
Unamortized debt discount	($8)	($8)	($8)
Long-term debt	2,792	2,792	2,492
Senior Notes	'	'	'
Debt Instrument [Line Items]	'	'	'
Effective Rate	5.54%	5.54%	'
Total senior debt	2,800	2,800	2,500
Senior Notes | Four Point Seven Five Percent Senior Note Due Twenty Twenty Three [Member] [Domain] [Member]	'	'	'
Debt Instrument [Line Items]	'	'	'
Debt Instrument, Interest Rate, Stated Percentage	4.75%	'	'
Senior Notes | Senior Notes Due 2017	'	'	'
Debt Instrument [Line Items]	'	'	'
Effective Rate	6.31%	6.31%	'
Debt Instrument, Interest Rate, Stated Percentage	6.25%	6.25%	'
Total senior debt	650	650	650
Senior Notes | Senior Notes Due 2021	'	'	'
Debt Instrument [Line Items]	'	'	'
Effective Rate	4.81%	4.81%	'
Debt Instrument, Interest Rate, Stated Percentage	4.00%	4.00%	'
Total senior debt	650	650	650
Senior Notes | Senior Notes Due 2023	'	'	'
Debt Instrument [Line Items]	'	'	'
Effective Rate	3.25%	3.25%	'
Debt Instrument, Interest Rate, Stated Percentage	3.25%	3.25%	'
Total senior debt	350	350	350
Senior Notes | Four Point Seven Eight Percent Senior Note Due Twenty Twenty Three [Member] [Domain]	'	'	'
Debt Instrument [Line Items]	'	'	'
Effective Rate	4.78%	4.78%	'
Total senior debt	300	'	0
Senior Notes | Senior Notes Due 2029	'	'	'
Debt Instrument [Line Items]	'	'	'
Effective Rate	7.36%	7.36%	'
Debt Instrument, Interest Rate, Stated Percentage	7.25%	7.25%	'
Total senior debt	200	200	200
Senior Notes | Senior Notes Due 2033	'	'	'
Debt Instrument [Line Items]	'	'	'
Effective Rate	6.05%	6.05%	'
Debt Instrument, Interest Rate, Stated Percentage	6.00%	6.00%	'
Total senior debt	300	300	300
Senior Notes | Senior Notes Due 2037	'	'	'
Debt Instrument [Line Items]	'	'	'
Effective Rate	6.89%	6.89%	'
Debt Instrument, Interest Rate, Stated Percentage	6.88%	6.88%	'
Total senior debt	$350	$350	$350
Four Point Seven Eight Percent Senior Note Due Twenty Twenty Three [Member] [Domain] | Senior Notes Due Twenty Twenty Three [Member]	'	'	'
Debt Instrument [Line Items]	'	'	'
Debt Instrument, Interest Rate, Stated Percentage	'	4.75%	'

Fair_Value_Measurements_Narrat

Fair Value Measurements (Narrative) (Details) (USD $)	3-May-14	Feb. 01, 2014	4-May-13	Jan. 28, 2012
In Millions, unless otherwise specified
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]	'	'	'	'
Cash and Cash Equivalents, at Carrying Value	$717	$971	$518	$537
Long-term investments, par value	82	82	82	'
Long-term Debt, Excluding Current Maturities	2,792	2,792	2,492	'
Fair Value, Inputs, Level 1	'	'	'	'
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]	'	'	'	'
Long Term Investments Fair Value	$3,082	$2,988	$2,802	'

StockBased_Compensation_Summar

Stock-Based Compensation - Summary of Stock Based Compensation Grants (Details) (USD $)	3 Months Ended
In Thousands, except Per Share data, unless otherwise specified	3-May-14	4-May-13
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]	'	'
Stock options granted	126	414
Restricted shares and units granted, excluding shares earned in lieu of cash dividends	730	654
Total stock-based compensation grants	856	1,068
Stock options	$12.68	$10.18
Restricted shares and units	$56.75	$46.39

Net_Income_Per_Section_Net_Inc1

Net Income Per Section Net Income Per Section (Details) (USD $)	3 Months Ended
In Millions, unless otherwise specified	3-May-14	4-May-13
Net Income Per Section [Abstract]	'	'
Net income	$125	$147
Basic	206	222
Impact of dilutive employee stock-based awards	2	1
Diluted	208	223
Antidilutive shares	7	12