Exhibit 99.1
National, Retail Trades and First Call - Release: August 14, 2003 at 4:00 EDT
KOHL'S CORPORATION REPORTS SECOND QUARTER SALES AND EARNINGS
Menomonee Falls, WI...August 14/Business Wire/Kohl's Corporation (NYSE: KSS). Kohl's Corporation reported a 14.9% increase to $2.2 billion in net sales for the quarter ended August 2, 2003. Comparable store sales rose 1.1% for the same period. Net income was $112.1 million, or $0.33 per diluted share compared to $124.4 million or $0.36 per diluted share a year ago.
For the six months ended August 2, 2003 net sales increased 14.1% to $4.3 billion from $3.8 billion for the six months ended August 3, 2002. Comparable store sales decreased 0.7%. Net income was $223.2 million or $0.65 per diluted share, compared to $231.0 million or $0.67 per diluted share a year ago.
Expansion Update
During the first half of the year, the Company successfully opened 35 new stores including entering the greater Los Angeles area with 28 stores; the San Antonio, TX market with 3 stores and a store each in Kalamazoo, MI; West Springfield, MA; Hooksett, NH; and Doylestown, PA.
Kohl's plans to open another 50 stores in the second half of the year, two in August and 48 in October. The Company plans to enter the Phoenix, AZ market with 10 stores, the Little Rock, AR market with three stores, the Las Vegas, NV market with three stores, the Birmingham, AL market with two stores, the Tucson, AZ market with two stores and the Flagstaff, AZ market with one store. In addition, the Company will add 11 stores in the Midwest Region, five stores in the Mid-Atlantic region, five stores in the Northeast region, four stores in the Southeast region, two stores in the Southcentral region, and two stores in the Southwest region. This raises our projected new store openings for fiscal 2003 from 80 stores to 85 stores.
The Company plans to open approximately 95 new stores in fiscal 2004. We anticipate opening approximately half the stores in the first quarter including the Company's continued expansion in the Southwest region with entry into the Sacramento, CA market with seven stores, the San Diego, CA market with five stores, and the Fresno, CA market with three stores.
Second Quarter Earnings Release
Investors will have the opportunity to listen to the second quarter earnings conference call today at 5:00 p.m. (EDT) by dialing 847-619-6398 ten minutes prior to the start of the call. A replay of the call will be available for approximately 24 hours after the conclusion of the call at 630-652-3018, pass code: 7435322. In addition, the call will be web cast live over the Internet through the Company's web site located at http://www.kohls.com (click on "About Us" for link) or through Broadcast Networks' Vcall web site located at http://www.vcall.com. To listen to the call, please go to either web site at least fifteen minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available for approximately 30 days after the conclusion of the web cast.
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 on Exhibit 99.1 to 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.
Investor Relations Contact: Arlene Meier, Chief Operating Officer, (262) 703-1646
Media Contact: Tawn Earnest, Manager - Public Relations, (262) 703-6609
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KOHL'S CORPORATION |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME |
(Unaudited) |
(In Millions, except per share data) |
| | | | | | | | | | | | | | | | |
| | 3 Months Ended | 6 Months Ended |
| |
August 2,
2003
| % to
Net Sales |
August 3,
2002
| % to
Net Sales |
August 2,
2003
| % to
Net Sales |
August 3,
2002
| % to
Net Sales |
| | | | | | | | | | | | | | | | |
Net sales | | $ 2,208.5 | | | | $ 1,921.8 | | | | $ 4,326.2 | | | | $ 3,792.4 | | |
Cost of merchandise sold | 1,471.7 | | 66.6% | | 1,234.7 | | 64.2% | | 2,848.1 | | 65.8% | | 2,448.6 | | 64.6% |
| | --------------- | | | | --------------- | | | | --------------- | | | | --------------- | | |
Gross margin | | 736.8 | | 33.4% | | 687.1 | | 35.8% | | 1,478.1 | | 34.2% | | 1,343.8 | | 35.4% |
| | | | | | | | | | | | | | | | |
Operating expenses | | | | | | | | | | | | | | | |
Selling, general and administrative | 473.8 | | 21.5% | | 423.7 | | 22.0% | | 948.0 | | 21.9% | | 835.5 | | 22.0% |
Depreciation and amortization | 57.0 | | 2.6% | | 47.4 | | 2.5% | | 112.4 | | 2.7% | | 91.4 | | 2.4% |
Preopening expenses | 2.5 | | 0.1% | | 3.0 | | 0.2% | | 18.0 | | 0.4% | | 19.9 | | 0.5% |
| | --------------- | | | | --------------- | | | | --------------- | | | | --------------- | | |
Operating income | 203.5 | | 9.2% | | 213.0 | | 11.1% | | 399.7 | | 9.2% | | 397.0 | | 10.5% |
| | | | | | | | | | | | | | | | |
Interest expense, net | 23.2 | | 1.0% | | 13.0 | | 0.7% | | 40.9 | | 0.9% | | 25.6 | | 0.7% |
| | --------------- | | | | --------------- | | | | --------------- | | | | --------------- | | |
Income before income taxes | 180.3 | | 8.2% | | 200.0 | | 10.4% | | 358.8 | | 8.3% | | 371.4 | | 9.8% |
Provision for income taxes | 68.2 | | 3.1% | | 75.6 | | 3.9% | | 135.6 | | 3.1% | | 140.4 | | 3.7% |
| | --------------- | | | | --------------- | | | | --------------- | | | | --------------- | | |
Net income | | $ 112.1 | | 5.1% | | $ 124.4 | | 6.5% | | $ 223.2 | | 5.2% | | $ 231.0 | | 6.1% |
| | ======== | | | | ======== | | | | ======== | | | | ======== | | |
| | | | | | | | | | | | | | | | |
Earnings per share: | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
Basic | | | | | | | | | | | | | | | | |
Net income per share | $ 0.33 | | | | $ 0.37 | | | | $ 0.66 | | | | $ 0.69 | | |
Avg. number of shares | 339.0 | | | | 336.7 | | | | 338.5 | | | | 336.3 | | |
| | | | | | | | | | | | | | | | |
Diluted | | | | | | | | | | | | | | | | |
Net income per share | $ 0.33 | | | | $ 0.36 | | | | $ 0.65 | | | | $ 0.67 | | |
Avg. number of shares | 343.7 | | | | 343.4 | | | | 343.1 | | | | 342.9 | | |
Kohl's Corporation |
Condensed Consolidated Balance Sheet |
(In Thousands) |
(Unaudited) |
Subject to Reclassification |
| | | | | |
| | | August 2, 2003 | | August 3, 2002 |
| | | | | |
Assets | | | | | |
Current assets: | | | | | |
Cash and cash equivalents | | $ 107,978 | | $ 85,039 |
Short-term investments | | | 35,036 | | 113,230 |
Accounts receivable trade, net | | 950,142 | | 828,458 |
Merchandise inventories | | | 1,716,763 | | 1,454,419 |
Deferred income taxes | | | 34,146 | | 40,593 |
Other current assets | | | 77,285 | | 56,373 |
Total current assets | | | 2,921,350 | | 2,578,112 |
| | | | | |
Property and equipment, net | | 2,980,460 | | 2,425,389 |
Favorable lease rights, net | | 186,088 | | 171,007 |
Goodwill, net | | | 9,338 | | 9,338 |
Other assets | | | 101,887 | | 89,945 |
Total assets | | | $ 6,199,123 | | $ 5,273,791 |
| | | =========== | | =========== |
Liabilities and Shareholders' Equity | | | | |
| | | | | |
Current liabilities: | | | | | |
Accounts payable | | | $ 701,852 | | $ 590,942 |
Accrued liabilities | | | 295,149 | | 246,148 |
Income taxes payable | | | 57,542 | | 69,253 |
Current portion of long-term debt and capital leases | | 12,298 | | 11,141 |
Total current liabilities | | | 1,066,841 | | 917,484 |
| | | | | |
Long-term debt and capital leases | | | 1,064,316 | | 1,089,695 |
Deferred income taxes | | | 205,257 | | 134,847 |
Other long-term liabilities | | 69,245 | | 52,251 |
Shareholder's equity | | | 3,793,464 | | 3,079,514 |
Total liabilities and shareholder's equity | $ 6,199,123 | | $ 5,273,791 |
| ============= | | ============ |
Kohl's Corporation |
Condensed Consolidated Statement of Cash Flows |
(In Thousands) |
(Unaudited) |
Subject to Reclassification |
| | | | | | | | |
| | | | | | 6 Months Ended |
| | | | | |
August 2, 2003
| |
August 3, 2002
|
| | | | | | | | |
Operating activities | | | | | | |
| | | | | | | | |
Net income | | | | | $ 223,158 | | $ 231,009 |
Adjustments to reconcile net income to net cash | | | | |
provided by (used in) operating activities: | | | | | |
| Depreciation and amortization | | | 119,047 | | 91,810 |
| Amortization of debt discount | | | 3,468 | | 4,658 |
| Deferred income taxes | | | 55,853 | | 32,318 |
| Changes in operating assets and liabilities: | | | | |
| Accounts receivable | | | 40,668 | | 7,488 |
| Merchandise inventories | | | (89,767) | | (256,112) |
| Other current assets | | | (33,766) | | (14,973) |
| Accounts payable | | | 7,104 | | 112,072 |
| Accrued and other long-term liabilities | | (16,095) | | (8,119) |
| Income taxes | | | | (52,936) | | (20,557) |
| | | | | | | | |
Net cash provided by operating activities | | | 256,734 | | 179,594 |
| | | | | | | | |
Investing activities | | | | | | | |
| | | | | | | | |
Acquisition of property and equipment | | | | | |
and favorable lease rights, net | | | (334,646) | | (310,096) |
Net sales of short-term investments | | | 440,955 | | 116,147 |
Other | | | | | | (13,814) | | (12,556) |
Net cash provided by (used in) investing activities | | 92,495 | | (206,505) |
| | | | | | | | |
Financing activities | | | | | | |
| | | | | | | | |
Repayments of other long-term debt, net | | | (357,868) | | (15,660) |
Payments of financing fees on debt | | | (185) | | (936) |
Proceeds from stock option exercises | | | 26,717 | | 21,824 |
| | | | | | | | |
Net cash (used in) provided by financing activities | | (331,336) | | 5,228 |
| | | | | | | | |
Net increase (decrease) in cash and cash equivalents | | 17,893 | | (21,683) |
Cash and cash equivalents at beginning of period | | 90,085 | | 106,722 |
| | | | | | | | |
Cash and cash equivalents at end of period | | | $ 107,978 | | $ 85,039 |
| | | =========== | | =========== |
