Kohl's Corporation Reports Third Quarter Financial Results
MENOMONEE FALLS, Wis.--(BUSINESS WIRE)--November 13, 2014-- Kohl’s Corporation (NYSE:KSS). Kohl’s Corporation today reported results for the quarter and year-to-date period ended November 1, 2014.
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| | | | | | | | | | | | | | | | | | | |
| | Quarter | | Year to Date |
| ($ in millions) | 2014 | | 2013 | | Change | | 2014 | | 2013 | | Change |
| Sales | $ | 4,374 |
| | $ | 4,444 |
| | (1.6)% | | $ | 12,686 |
| | $ | 12,932 |
| | (1.9)% |
| Comparable store sales | (1.8 | )% | | (1.6 | )% | | - | | (2.2 | )% | | (0.9 | )% | | - |
| Net income | $ | 142 |
| | $ | 177 |
| | (20)% | | $ | 498 |
| | $ | 555 |
| | (10)% |
| Diluted earnings per share | $ | 0.70 |
| | $ | 0.81 |
| | (14)% | | $ | 2.43 |
| | $ | 2.51 |
| | (3)% |
Dividend
On November 12, 2014, Kohl's Board of Directors declared a quarterly cash dividend on the Company's common stock of $0.39 per share. The dividend is payable December 24, 2014 to shareholders of record at the close of business on December 10, 2014.
Store Update
Kohl’s ended the quarter with 1,163 stores in 49 states, compared with 1,158 stores at the same time last year. During the quarter, the Company opened stores in three new locations and reopened one store which had closed in the first quarter for a complete re-build.
Third Quarter 2014 Earnings Conference Call
Kohl's will host its quarterly earnings conference call at 8:30 am ET on November 13, 2014. The phone number for the conference call is (800) 230-1059. Replays of the call will be available for 30 days by dialing (800) 475-6701. The conference ID for both the live call and the replay is 338567. The conference call and replays are also accessible via the Company's web site at http://www.kohlscorporation.com/InvestorRelations/event-calendar.htm.
Cautionary Statement Regarding Forward-Looking Information
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Kohl's intends forward-looking terminology such as “believes,” “expects,” “may,” “will,” “should,” “anticipates,” “plans,” or similar expressions to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, which could cause Kohl's actual results to differ materially from those anticipated by the forward-looking statements. These risks and uncertainties include, but are not limited to, those described in Item 1A in Kohl's Annual Report on Form 10-K, which is expressly incorporated herein by reference, and other factors as may periodically be described in Kohl's filings with the SEC.
About Kohl's
Kohl’s (NYSE: KSS) is a leading specialty department store with 1,163 stores in 49 states. With a commitment to inspiring and empowering families to lead fulfilled lives, the company offers amazing national and exclusive brands, incredible savings and inspiring shopping experiences in-store, online at Kohls.com and via mobile devices. Committed to its communities, Kohl’s has raised more than $257 million for children’s initiatives nationwide through its Kohl’s Cares® cause merchandise program, which operates under Kohl's Cares, LLC, a wholly-owned subsidiary of Kohl's Department Stores, Inc. For additional information about Kohl’s philanthropic and environmental initiatives, visit www.Kohls.com/Cares. For a list of store locations and information, or for the added convenience of shopping online, visit www.Kohls.com.
Connect with Kohl’s:
Facebook (http://www.facebook.com/Kohls)
Twitter (http://twitter.com/Kohls)
Google+ (http://plus.google.com/+Kohls)
Pinterest (http://pinterest.com/Kohls)
Instagram (http://instagram.com/Kohls)
Contacts
Investor Relations:
Wes McDonald, Senior Executive Vice President and Chief Financial Officer, (262) 703-1893
Media:
Bevin Bailis, SVP, PR and Communications, (262) 703-1464
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| KOHL'S CORPORATION |
| CONSOLIDATED STATEMENTS OF INCOME |
| (In Millions, except per share data) |
| (Unaudited) |
| | | | | | | | |
| | Three Months Ended | | Nine Months Ended |
| | November 1,
2014 | | November 2,
2013 | | November 1,
2014 | | November 2, 2013 |
| Net sales | $ | 4,374 |
| | $ | 4,444 |
| | $ | 12,686 |
| | $ | 12,932 |
|
| Cost of merchandise sold | 2,746 |
| | 2,778 |
| | 7,908 |
| | 8,063 |
|
| | | | | | | | |
| Gross margin | 1,628 |
| | 1,666 |
| | 4,778 |
| | 4,869 |
|
| | | | | | | | |
| Operating expenses: | | | | | | | |
| Selling, general, and administrative | 1,097 |
| | 1,073 |
| | 3,078 |
| | 3,071 |
|
| Depreciation and amortization | 227 |
| | 228 |
| | 665 |
| | 665 |
|
| | | | | | | | |
| Operating income | 304 |
| | 365 |
| | 1,035 |
| | 1,133 |
|
| | | | | | | | |
| Interest expense, net | 85 |
| | 84 |
| | 255 |
| | 251 |
|
| | | | | | | | |
| Income before income taxes | 219 |
| | 281 |
| | 780 |
| | 882 |
|
| Provision for income taxes | 77 |
| | 104 |
| | 282 |
| | 327 |
|
| | | | | | | | |
| Net income | $ | 142 |
| | $ | 177 |
| | $ | 498 |
| | $ | 555 |
|
| | | | | | | | |
| Basic net income per share | $ | 0.70 |
| | $ | 0.82 |
| | $ | 2.44 |
| | $ | 2.53 |
|
| Average number of shares | 202 |
| | 216 |
| | 204 |
| | 219 |
|
| | | | | | | | |
| Diluted net income per share | $ | 0.70 |
| | $ | 0.81 |
| | $ | 2.43 |
| | $ | 2.51 |
|
| Average number of shares | 203 |
| | 218 |
| | 205 |
| | 221 |
|
| | | | | | | | |
| As a percent of net sales: | | | | | | | |
| Gross margin | 37.2 | % | | 37.5 | % | | 37.7 | % | | 37.7 | % |
| Selling, general and | | | | | | | |
| administrative expenses | 25.1 | % | | 24.1 | % | | 24.3 | % | | 23.7 | % |
| Operating income | 6.9 | % | | 8.2 | % | | 8.2 | % | | 8.8 | % |
| Net income | 3.2 | % | | 4.0 | % | | 3.9 | % | | 4.3 | % |
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| | | | | | | | |
| KOHL'S CORPORATION |
| CONSOLIDATED BALANCE SHEETS |
| (In Millions) |
| (Unaudited) |
| | | | | |
| | | November 1,
2014 | | November 2,
2013 |
| Assets | | | | |
| Current assets: | | | | |
| Cash and cash equivalents | | $ | 631 |
| | $ | 598 |
|
| Merchandise inventories | | 4,973 |
| | 4,959 |
|
| Income tax receivable | | 52 |
| | — |
|
| Deferred income taxes | | 125 |
| | 147 |
|
| Other | | 297 |
| | 283 |
|
| | | | | |
| Total current assets | | 6,078 |
| | 5,987 |
|
| | | | | |
| Property and equipment, net | | 8,671 |
| | 8,925 |
|
| Other assets | | 298 |
| | 333 |
|
| | | | | |
| Total assets | | $ | 15,047 |
| | $ | 15,245 |
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| | | | | |
| Liabilities and Shareholders' Equity | | | | |
| Current liabilities: | | | | |
| Accounts payable | | $ | 2,384 |
| | $ | 2,261 |
|
| Accrued liabilities | | 1,162 |
| | 1,198 |
|
| Income taxes payable | | — |
| | 41 |
|
| Current portion of capital lease | | | | |
| and financing obligations | | 109 |
| | 141 |
|
| | | | | |
| Total current liabilities | | 3,655 |
| | 3,641 |
|
| | | | | |
| Long-term debt | | 2,793 |
| | 2,792 |
|
| Capital lease and financing obligations | | 1,886 |
| | 1,950 |
|
| Deferred income taxes | | 336 |
| | 390 |
|
| Other long-term liabilities | | 572 |
| | 548 |
|
| Shareholders' equity | | 5,805 |
| | 5,924 |
|
| | | | | |
| Total liabilities and shareholders' equity | | $ | 15,047 |
| | $ | 15,245 |
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| | | | | | | |
| KOHL'S CORPORATION |
| CONSOLIDATED STATEMENTS OF CASH FLOWS |
| (In Millions) |
| (Unaudited) |
| |
| | Nine Months Ended |
| | November 1,
2014 | | November 2,
2013 |
| Operating activities | | | |
| Net income | $ | 498 |
| | $ | 555 |
|
| Adjustments to reconcile net income to net cash | | | |
| provided by operating activities: | | | |
| Depreciation and amortization | 665 |
| | 665 |
|
| Share-based compensation | 38 |
| | 41 |
|
| Excess tax benefits from share-based compensation | (2 | ) | | (3 | ) |
| Deferred income taxes | (37 | ) | | (1 | ) |
| Other non-cash revenues and expenses | 19 |
| | 30 |
|
| Changes in operating assets and liabilities: | | | |
| Merchandise inventories | (1,093 | ) | | (1,204 | ) |
| Other current and long-term assets | (1 | ) | | 11 |
|
| Accounts payable | 1,019 |
| | 954 |
|
| Accrued and other long-term liabilities | (1 | ) | | 79 |
|
| Income taxes | (175 | ) | | (113 | ) |
| | | | |
| Net cash provided by operating activities | 930 |
| | 1,014 |
|
| | | | |
| Investing activities | | | |
| Acquisition of property and equipment | (561 | ) | | (465 | ) |
| Sales of investments in auction rate securities | 59 |
| | 1 |
|
| Other | 6 |
| | 13 |
|
| | | | |
| Net cash used in investing activities | (496 | ) | | (451 | ) |
| | | | |
| Financing activities | | | |
| Treasury stock purchases | (549 | ) | | (549 | ) |
| Shares withheld for taxes on vested restricted shares | (17 | ) | | (13 | ) |
| Dividends paid | (239 | ) | | (229 | ) |
| Proceeds from issuance of debt | — |
| | 300 |
|
| Proceeds from financing obligations | 5 |
| | — |
|
| Capital lease and financing obligation payments | (87 | ) | | (87 | ) |
| Proceeds from stock option exercises | 111 |
| | 77 |
|
| Excess tax benefits from share-based compensation | 2 |
| | 3 |
|
| Deferred financing costs | — |
| | (4 | ) |
| | | | |
| Net cash used in financing activities | (774 | ) | | (502 | ) |
| | | | |
| Net increase (decrease) in cash and cash equivalents | (340 | ) | | 61 |
|
| Cash and cash equivalents at beginning of period | 971 |
| | 537 |
|
| | | | |
| Cash and cash equivalents at end of period | $ | 631 |
| | $ | 598 |
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