Kohl's (KSS) 10-Q 4 Dec 09 2010 Q3 Quarterly report Financial data

Statement Of Financial Position

Statement Of Financial Position Classified (USD $)
In Millions	Oct. 31, 2009	Jan. 31, 2009	Nov. 01, 2008
Current assets:
Cash	$232	$167	$243
Short-term investments	1,299	509	36
Merchandise inventories	3,807	2,799	3,712
Deferred income taxes	69	74	76
Other	168	170	165
Total current assets	5,575	3,719	4,232
Property and equipment, net	7,082	6,984	6,991
Long-term investments	325	332	345
Favorable lease rights, net	198	201	199
Goodwill	9	9	9
Other assets	121	108	110
Total assets	13,310	11,353	11,886
Current liabilities:
Accounts payable	2,071	881	1,644
Accrued liabilities	905	831	769
Income taxes payable	14	105	1
Short-term debt	0	0	302
Current portion of capital leases	17	17	17
Total current liabilities	3,007	1,834	2,733
Long-term debt and capital leases	2,054	2,053	2,057
Deferred income taxes	390	320	314
Other long-term liabilities	464	407	387
Shareholders' equity:
Common stock	4	4	4
Paid-in capital	2,060	1,971	1,955
Treasury stock, at cost, 46 shares at October 31, 2009, January 31, 2009 and November 1, 2008	(2,639)	(2,638)	(2,638)
Accumulated other comprehensive loss	(38)	(46)	(38)
Retained earnings	8,008	7,448	7,112
Total shareholders' equity	7,395	6,739	6,395
Total liabilities and shareholders' equity	$13,310	$11,353	$11,886

1_Statement Of Financial Positi

Statement Of Financial Position Classified (Parenthetical) (USD $)
Share data in Millions	Oct. 31, 2009	Jan. 31, 2009	Nov. 01, 2008
Treasury stock, shares	46	46	46

Statement Of Income

Statement Of Income (USD $)
In Millions, except Per Share data	3 Months Ended Oct. 31, 2009	3 Months Ended Nov. 01, 2008	9 Months Ended Oct. 31, 2009	9 Months Ended Nov. 01, 2008
Net sales	$4,051	$3,804	$11,496	$11,153
Cost of merchandise sold (exclusive of depreciation shown separately below)	2,512	2,381	7,068	6,920
Gross margin	1,539	1,423	4,428	4,233
Operating expenses:
Selling, general, and administrative	1,027	982	2,954	2,834
Depreciation and amortization	150	135	435	398
Preopening expenses	23	21	49	38
Operating income	339	285	990	963
Interest expense, net	31	28	93	81
Income before income taxes	308	257	897	882
Provision for income taxes	115	97	337	333
Net income	$193	$160	$560	$549
Basic:
Basic	0.63	0.53	1.84	1.79
Average number of shares	305	305	305	306
Diluted:
Diluted	0.63	0.52	1.83	1.79
Average number of shares	308	305	306	307

Statement Of Shareholders Equit

Statement Of Shareholders Equity And Other Comprehensive Income (USD $)
In Millions		Common Stock Amount	Paid-In Capital	Treasury Stock	Accumulated Other Comprehensive Loss	Retained Earnings	Total
Beginning Balance at Jan. 31, 2009		$4	$1,971	($2,638)	($46)	$7,448	$6,739
Beginning Balance at Jan. 31, 2009	351
Net income						560	560
Other comprehensive income:
Unrealized gain on investments, net of tax					8		8
Share-based compensation			49				49
Exercise of stock options	2
Exercise of stock options			44				44
Net income tax impact from exercise of stock options			(4)				(4)
Treasury stock purchases				(1)			(1)
Ending Balance at Oct. 31, 2009	353
Ending Balance at Oct. 31, 2009		4	2,060	(2,639)	(38)	8,008	7,395
Beginning Balance at Aug. 01, 2009		4
Other comprehensive income:
Ending Balance at Oct. 31, 2009		$4

Statement Of Cash Flows Indirec

Statement Of Cash Flows Indirect (USD $)
In Millions	3 Months Ended Oct. 31, 2009	3 Months Ended Nov. 01, 2008	9 Months Ended Oct. 31, 2009	9 Months Ended Nov. 01, 2008
Operating activities
Net income	$193	$160	$560	$549
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization, including debt discount and deferred financing fees			436	399
Share-based compensation			45	39
Excess tax benefits from share-based compensation			3	0
Deferred income taxes			69	71
Other non-cash revenues and expenses			39	18
Changes in operating assets and liabilities:
Merchandise inventories			(1,005)	(854)
Other current and long-term assets			2	(30)
Accounts payable			1,190	811
Accrued and other long-term liabilities			115	(47)
Income taxes			(96)	(128)
Net cash provided by operating activities			1,358	828
Investing activities
Acquisition of property and equipment and favorable lease rights			(550)	(843)
Net purchases of short-term investments			(790)	(6)
Purchases of long-term investments			0	(53)
Sales of long-term investments			20	93
Other			(1)	6
Net cash used in investing activities			(1,321)	(803)
Financing activities
Net borrowings under credit facilities			0	302
Capital lease payments			(12)	(9)
Treasury stock purchases			(1)	(262)
Excess tax benefits from share-based compensation			(3)	0
Proceeds from stock option exercises			44	6
Net cash provided by financing activities			28	37
Net increase in cash			65	62
Cash at beginning of period			167	181
Cash at end of period	232	243	232	243
Supplemental information:
Interest paid, net of capitalized interest			82	93
Income taxes paid			$366	$390

1.Basis of Presentation

1.Basis of Presentation
	9 Months Ended Oct. 31, 2009 USD / shares
Notes to Financial Statements [Abstract]
1.Basis of Presentation	1. 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 2008 Annual Report on Form 10-K (Commission File No.1-11084) filed with the Securities and Exchange Commission. 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 depend significantly upon the timing and amount of sales and costs associated with the opening of new stores. We operate as a single business unit. Certain reclassifications have been made to the prior period Condensed Consolidated Balance Sheets and Statements of Cash Flows to conform to the 2009 presentation. The $15 million reclassification was between Other Current Assets and Accrued Liabilities and had no impact on Net Cash Provided by Operating Activities in our Statements of Cash Flows.

2.Debt

2.Debt
	9 Months Ended Oct. 31, 2009 USD / shares
Notes to Financial Statements [Abstract]
2.Debt	2. Debt Long-term debt consists of the following: Maturing Weighted Average Effective Rate October31, 2009 January31, 2009 November1, 2008 (Dollars in Millions) Non-callable and unsecured senior debt: 2011 6.59 % $ 400 $ 400 $ 400 2017 6.31 % 650 650 650 2029 7.36 % 200 200 200 2033 6.05 % 300 300 300 2037 6.89 % 350 350 350 Total senior debt 6.55 % 1,900 1,900 1,900 Capital lease obligations 178 177 181 Unamortized debt discount (7 ) (7 ) (7 ) Less current portion (17 ) (17 ) (17 ) Long-term debt and capital leases $ 2,054 $ 2,053 $ 2,057 Based on quoted market prices (Level 1per Accounting Standards Codification (ASC) No.820, Fair Value Measurements and Disclosures, formerly Statement of Financial Accounting Standards (SFAS) No.157), the estimated fair value of our senior debt was approximately $2.1 billion at October31, 2009.

3.Share-Based Compensation

3.Share-Based Compensation
	9 Months Ended Oct. 31, 2009 USD / shares
Notes to Financial Statements [Abstract]
3.Share-Based Compensation	3. Share-Based Compensation We grant share-based compensation, including options to purchase shares of our common stock and nonvested stock, pursuant to various plans. Annual grants of stock options and nonvested stock are generally made to eligible employees in the first quarter of the fiscal year. Grants to newly-hired and promoted employees and other discretionary grants are made periodically throughout the remainder of the year. The Black-Scholes option valuation model was used to estimate the fair value of each option award during the first nine months of the respective fiscal year based on the following assumptions: 2009 2008 Volatility 42.8 % 36.6 % Risk-free interest rate 1.8 % 2.6 % Expected life in years 5.4 5.3 Dividend yield 0 % 0 % Weighted-average fair value at grant date $ 17.51 $ 16.24 The following table summarizes our stock option activity for the first nine months of 2009 and 2008: 2009 2008 Shares Weighted Average Exercise Price Shares Weighted Average Exercise Price (Shares in Thousands) Balance at beginning of year 19,134 $ 53.01 17,313 $ 55.79 Granted 2,942 42.51 3,092 43.77 Forfeited/expired (722 ) 56.50 (1,122 ) 59.26 Exercised (1,114 ) 39.31 (134 ) 40.92 Balance at end of quarter 20,240 $ 52.11 19,149 $ 53.75 The following table summarizes our nonvested stock activity for the first nine months of 2009 and 2008: 2009 2008 Shares Weighted Average Grant Date Fair Value Shares Weighted Average GrantDate FairValue (Shares in Thousands) Balance at beginning of year 276 $ 54.39 150 $ 69.98 Granted 715 43.04 170 46.42 Forfeited (6 ) 45.57 (1 ) 42.89 Vested (72 ) 58.55 (54 ) 64.57 Balance at end of quarter 913 $ 45.26 265 $ 56.13 Total share-based compensation expense was $18 million for the three months ended October31, 2009 and $16 million for the three months ended November1, 2008. Total share-based compensation expense was $45 million for the nine months ended October31, 2009 and $39 million for the nine months ended November1, 2008. Total unrecognized share-based compensation expense for all share-based payment plans was $136 million at October31, 2009, of which approximately $18 million is expected to be recognized in the fourth quarter of 2009, $54 million in 2010, $31 million in 2011, $17 million in 2012, $13 million in 2013 and $3 million in 2014. Future compensation expense may be impacted by future grants, changes in forfeiture estimates and/or actual forfeitures which differ from estimated forfeitures.

4.Long-Term Investments

4.Long-Term Investments
	9 Months Ended Oct. 31, 2009 USD / shares
Notes to Financial Statements [Abstract]
4.Long-Term Investments	4. Long-Term Investments As of October31, 2009, we had long-term investments in auction rate securities (ARS) with a par value of $387 million and a fair value of $325 million. ARS are long-term debt instruments with interest rates reset through periodic short-term auctions. Our ARS mature at various dates between 2015 and 2056. The weighted-average remaining maturity of our ARS portfolio is approximately 27 years. Our ARS portfolio consists entirely of highly-rated, insured student loan backed securities. Substantially all of the principal and interest is insured by the federal government and the remainder is insured by various insurance companies. As of October31, 2009, $195 million of our ARS (at fair value) were rated AAA by Moodys, Standard Poors and/or Fitch Ratings. As a result of persistent failed auctions since February 2008 and the resulting uncertainty of when these investments could be successfully liquidated at par, we have recorded all of our ARS as Long-term Investments within the Condensed Consolidated Balance Sheets. We intend to hold these ARS until their fair value once again equals their par value and, based on other sources of liquidity, do not believe we will be required to sell them before recovery of par value. Therefore, impairment charges are considered temporary and have been included in Accumulated Other Comprehensive Loss within our Condensed Consolidated Balance Sheets. The following table presents a rollforward of our ARS, all of which are measured at fair value on a recurring basis using unobservable inputs (Level 3per ASC No.820, Fair Value Measurements and Disclosures, formerly SFAS No.157): (In millions) Balance as of January 31, 2009 $ 332 Sales (at par) (20 ) Unrealized gain 13 Balance as of October 31, 2009 $ 325

5.Contingencies

5.Contingencies
	9 Months Ended Oct. 31, 2009 USD / shares
Notes to Financial Statements [Abstract]
5.Contingencies	5. Contingencies We are involved in various legal matters arising in the normal course of business. In the opinion of management, the outcome of such proceedings and litigation will not have a material adverse impact on our consolidated financial statements.

6.Net Income Per Share

6.Net Income Per Share
	9 Months Ended Oct. 31, 2009 USD / shares
Notes to Financial Statements [Abstract]
6.Net Income Per Share	6. Net Income Per Share The calculations of the numerator and denominator for basic and diluted net income per share are summarized as follows: Three Months Ended Nine Months Ended Oct.31, 2009 Nov.1, 2008 Oct.31, 2009 Nov.1, 2008 (In Millions) Numerator - net income $ 193 $ 160 $ 560 $ 549 Denominator - weighted average shares: Basic 305 305 305 306 Impact of dilutive employee stock options and non-vested stock (a) 3 - 1 1 Diluted 308 305 306 307 (a) Excludes 10million options for the three months ended October31, 2009, 16million options for the three months ended November1, 2008, 18million options for the nine months ended October31, 2009 and 16million options for the nine months ended November1, 2008 as the impact of such options was antidilutive.

7.New Accounting Pronouncements

7.New Accounting Pronouncements
	9 Months Ended Oct. 31, 2009 USD / shares
Notes to Financial Statements [Abstract]
7.New Accounting Pronouncements	7. New Accounting Pronouncements In June 2009, the Financial Accounting Standards Board (FASB) issued SFAS No.168, The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles (GAAP) (codified in ASC No.105). SFAS No.168 replaces SFAS No.162, The Hierarchy of Generally Accepted Accounting Principles, and establishes the FASB Accounting Standards Codification (Codification) as the source of authoritative accounting principles recognized by the FASB in the preparation of financial statements in conformity with GAAP. The Codification supersedes all previously-existing non-Securities and Exchange Commission (SEC) accounting and reporting standards. Rules and interpretive releases of the SEC under authority of federal securities laws will continue to be sources of authoritative GAAP for SEC registrants. We began using the new guidelines and numbering system prescribed by the Codification when referring to GAAP in this Quarterly Report on Form 10-Q for the period ending October31, 2009. As the Codification was not intended to change or alter existing GAAP, it did not have any impact on our consolidated financial results or financial position. In September 2006, the FASB issued SFAS No.157, Fair Value Measurements (codified in ASC No.820). ASC No.820 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. We adopted the required portions of this statement in fiscal 2008. The remaining portions of this statement, which are related to non-financial assets and liabilities, were adopted without material impact in the first quarter of 2009. In April 2009, the FASB also issued FSP No. FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments, (codified in ASC No.825-10) which requires disclosures about the fair value of financial instruments for interim reporting periods as well as in annual financial statements. The fair value of our debt is reported in Note 2, Debt, and the fair value of our long-term investments is reported in Note 4, Long-Term Investments. During the first quarter of 2009, we also adopted the provisions of FAS 157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly, (codified in ASC No.820-10) and FAS 115-2 and FAS 124-2, Recognition and Presentation of Other-Than-Temporary Impairments, (codified in ASC No.320-10) without material impact on our consolidated financial statements. In February 2007, the FASB issued SFAS No.159, The Fair Value Option for Financial Assets and Financial Liabilities (codified in ASC No.825) Including an amendment of FASB Statement No.115 (codified in ASC No.320). This standard permits entities to measure many financial instruments and certain other items at fair value. As of October31, 2009, we have not, and do not expect to, elect the fair value option for any eligible financial asset or liability. We adopted SFAS No.165, Subsequent Events (codified in ASC No.855) during the quarter ended August1, 2009. This pronouncement establish

Document Information

Document Information
	9 Months Ended Oct. 31, 2009 USD / shares
Document Information [Text Block]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	2009-10-31

Entity Information

Entity Information (USD $)
	9 Months Ended Oct. 31, 2009	Nov. 28, 2009
Entity [Text Block]
Trading Symbol	KSS
Entity Registrant Name	KOHLS CORPORATION
Entity Central Index Key	0000885639
Current Fiscal Year End Date	--01-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		306,601,805