National & Retail Trades and First Call, Release: November 15, 2007 at 4:00 PM (EST)
KOHL'S CORPORATION REPORTS THIRD QUARTER EARNINGS RESULTS
MENOMONEE FALLS, WI … November 15/BUSINESS WIRE/Kohl’s Corporation (NYSE:KSS). Kohl’s Corporation today reported net sales and earnings for the third quarter ended November 3, 2007.
Kohl’s Corporation third quarter earnings per diluted share were $0.61 in 2007 compared with $0.68 in last year’s period. Net income was $194.0 million compared with $224.5 million a year ago, a decrease of 13.6 percent. Net sales increased to $3.8 billion from $3.7 billion a year ago, an increase of 4.8 percent for the quarter. Comparable store sales decreased 2.6 percent for the same period.
For the nine months ended November 3, 2007, net income increased 7.7 percent to $672.2 million or $2.09 per diluted share, compared to $624.1 million or $1.85 per diluted share for the nine months ended October 28, 2006. Net sales increased 8.3 percent to $11.0 billion from $10.1 billion a year ago. Comparable store sales increased 0.7 percent for the same period.
Larry Montgomery, Kohl’s Chairman and Chief Executive Officer, said, “Our sales results reflected a difficult overall environment. We continued to operate our business in a conservative manner, managing inventory investment as we continued our improvement in gross margin while reducing expenses where possible without hurting the customer’s in-store experience.”
Montgomery added, “I am very proud of our associates and the role they played in delivering these results and want to thank them for their hard work, loyalty and dedication to serving our customers. They are the reason you can continue to ‘expect great things’ from Kohl’s.”
Earnings Guidance
For the fourth quarter, assuming comparable sales of flat to (2)%, the Company would expect earnings per diluted share of $1.45 to $1.51. This would result in earnings per diluted share of $3.52 to $3.58 for fiscal 2007 versus its previous guidance of $3.77 to $3.87 per diluted share. This would result in an increase of 6 percent to 8 percent over last year’s $3.31 per diluted share.
Expansion Update
During the month of September, the Company opened 80 new stores. The Company operated 914 stores in 47 states as of November 3, 2007, compared with 814 stores in 45 states at the same time last year.
The Company opened 15 additional stores on November 11. This completed the opening of 112 stores in fiscal 2007.
Third Quarter Earnings Conference Call
Investors will have the opportunity to listen to the conference call scheduled for 5:00 PM EST on November 15 by dialing (913) 905-3179 (Pass Code: 4574912) ten minutes prior to the start of the call. A replay of the conference call will be accessible from 8 PM EST November 15 through midnight December 14, 2007, by dialing (719) 457-0820 (Pass Code: 457912).
In addition, the call will be web cast live over the Internet through the Company’s web site located athttp://www.kohls.com (see “Investor Relations” / “Calendar of Events”), or through Premiere Global’s web site athttps://cis.premconf.com/sc/scw.dll/usr?cid=vlllrcdrznnvmddxm. To listen to the call, please go to either web site at least 15 minutes early to register, download, and install any necessary audio software. The web cast will be available for 30 days on both web sites.
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 including guidance on the Company’s targeted sales and earnings. 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
Based in Menomonee Falls, Wis., Kohl’s (NYSE: KSS) is a family-focused, value-oriented specialty department store offering moderately priced, exclusive and national brand apparel, shoes, accessories, beauty and home products in an exciting shopping environment. A company committed to the communities it serves, Kohl’s operates 929 stores in 47 states and has raised more than $85 million for children’s initiatives nationwide through its Kohl’s Cares for Kids® philanthropic program. For a list of store locations and information, or for the added convenience of shopping online, visit www.kohls.com.
Vicki Shamion, Vice President – Public Relations, (262) 703-1464
Kohl's Corporation
Condensed Consolidated Statements of Income
(In Millions, except per share data)
(Unaudited)
Subject to Reclassification
Three Months
Nine Months
(13 Weeks) Ended
(39 Weeks) Ended
% to
% to
% to
% to
November 3,
Net
October 28,
Net
November 3,
Net
October 28,
Net
2007
Sales
2006
Sales
2007
Sales
2006
Sales
Net sales
$ 3,825.2
$ 3,650.5
$ 10,986.4
$ 10,148.3
Cost of merchandise sold
2,407.2
62.9%
2,299.6
63.0%
6,854.1
62.4%
6,402.7
63.1%
Gross margin
1,418.0
37.1%
1,350.9
37.0%
4,132.3
37.6%
3,745.6
36.9%
Operating expenses:
Selling, general, and administrative
933.7
24.4%
858.7
23.5%
2,630.0
23.9%
2,387.3
23.5%
Depreciation and amortization
115.2
3.0%
94.3
2.6%
326.0
3.0%
283.7
2.8%
Preopening expenses
38.2
1.1%
28.5
0.8%
55.6
0.5%
47.6
0.5%
Operating income
330.9
8.6%
369.4
10.1%
1,120.7
10.2%
1,027.0
10.1%
Interest expense, net
18.7
0.4%
10.2
0.3%
39.4
0.4%
30.4
0.3%
Income before income taxes
312.2
8.2%
359.2
9.8%
1,081.3
9.8%
996.6
9.8%
Provision for income taxes
118.2
3.1%
134.7
3.7%
409.1
3.7%
372.5
3.7%
Net income
$ 194.0
5.1%
$ 224.5
6.1%
$ 672.2
6.1%
$ 624.1
6.1%
Basic net income per share
$ 0.61
$ 0.69
$ 2.10
$ 1.86
Average number of shares
316.9
326.9
319.7
335.1
Diluted net income per share
$ 0.61
$ 0.68
$ 2.09
$ 1.85
Average number of shares
318.6
329.8
322.4
338.3
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