KSS
$49.85
Kohl's
($.17)
(.34%)
Earnings Details
1st Quarter April 2021
Thursday, May 20, 2021 7:00:00 AM
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Summary

Kohl's Beats

Kohl's (KSS) reported 1st Quarter April 2021 earnings of $1.05 per share on revenue of $3.9 billion. The consensus estimate was for breakeven results on revenue of $3.4 billion. The Earnings Whisper number was $0.19 per share. Revenue grew 60.1% on a year-over-year basis.

The company said it expects fiscal 2022 earnings of $3.80 to $4.20 per share on revenue of $18.2 billion to $19.0 billion. The company's previous guidance was earnings of $2.45 to $2.95 per share on revenue of approximately $18.35 billion and the current consensus earnings estimate is $3.07 per share on revenue of $17.77 billion for the year ending January 31, 2022.

Kohl' Corp operates department stores that sell moderately priced exclusive and national brand apparel, footwear, accessories, beauty and home products.

Results
Reported Earnings
$1.05
Earnings Whisper
$0.19
Consensus Estimate
$0.00
Reported Revenue
$3.89 Bil
Revenue Estimate
$3.41 Bil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Kohl's Reports First Quarter Fiscal 2021 Financial Results

  • First quarter net sales and earnings exceed expectations and company raises full year 2021 financial outlook
  • First quarter net sales increase 69.5%
  • First quarter diluted earnings per share of $0.09; adjusted diluted earnings per share(2) of $1.05
  • Strengthened financial position during the quarter, reducing long-term debt by over $500 million and ending with $1.6 billion in cash
  • Raises full year 2021 net sales to increase in the mid-to-high teens percentage range as compared to 2020, operating margin to be in the range of 5.7% to 6.1% and adjusted earnings per share to be in the range of $3.80 to $4.20, excluding any non-recurring charges

MENOMONEE FALLS, Wis.--(BUSINESS WIRE)--Kohl’s Corporation (NYSE:KSS) today reported results for the quarter ended May 1, 2021.

 

Three Months

($ in millions, except per share data)

2021

2020

Change

Total revenue

$

3,887

 

$

2,428

 

 

60

.1%

Net sales(1)

 

69.5

%

 

(43.5

)%

 

 

 

Gross margin

 

39.0

%

 

17.3

%

2,173 bps

 

Selling, general, and administrative expenses

$

1,170

 

$

1,066

 

 

9.8

%

Reported

 

 

 

 

 

 

 

 

 

Net income (loss)

$

14

 

$

(541

)

 

100

%+

Diluted earnings (loss) per share

$

0.09

 

$

(3.52

)

 

100

%+

Non-GAAP(2)

 

 

 

 

 

 

 

 

 

Adjusted net income (loss)

$

165

 

$

(495

)

 

100

%+

Adjusted diluted earnings (loss) per share

$

1.05

 

$

(3.22

)

 

100

%+

(1)

Represents change in Net sales vs. prior year period.

(2)

Excludes Loss on extinguishment of debt and Impairments, store closing, and other costs.

“We are very pleased with our strong start to 2021 with both sales and earnings materially exceeding expectations. Along with a favorable consumer spending backdrop, we continue to see our key strategic initiatives gain traction and resonate with customers. We saw momentum build through the quarter, especially in our stores where we continue to elevate the experience. We are eagerly preparing for the upcoming launch of our Sephora partnership as well as the introduction of several new exciting brands this fall,” said Michelle Gass, Kohl’s chief executive officer.

“We are positioned to capitalize on growth opportunities during the balance of 2021 and remain firmly on track to achieving our 2023 strategic goals. Based on our first quarter results, we are raising our full year 2021 guidance,” said Gass.

Updated 2021 Financial Outlook

The Company is raising its full year 2021 financial outlook to include the following:

  • Net sales is now expected to increase in the mid-to-high teens percentage range compared to the previous expectation of mid-teens percentage rate increase
  • Operating margin is now expected to be in the range of 5.7% to 6.1% compared to the previous expectation of 4.5% to 5.0%
  • Adjusted earnings per share is now expected to be in the range of $3.80 to $4.20, excluding any non-recurring charges, compared to the previous expectation of $2.45 to $2.95

Dividend

On May 12, 2021, Kohl's Board of Directors declared a quarterly cash dividend on the Company's common stock of $0.25 per share. The dividend is payable June 23, 2021 to shareholders of record at the close of business on June 9, 2021.

First Quarter 2021 Earnings Conference Call

Kohl's will host its quarterly earnings conference call at 9:00 am ET on May 20, 2021. A webcast of the conference call and the related presentation materials will be available via the Company's web site at investors.kohls.com, both live and after the call.

Cautionary Statement Regarding Forward-Looking Information and Non-GAAP Measures

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The Company 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 the Company's actual results to differ materially from those anticipated by the forward-looking statements. These risks and uncertainties include, but are not limited to, risks described more fully in Item 1A in the Company's Annual Report on Form 10-K, which is expressly incorporated herein by reference, and other factors as may periodically be described in the Company's filings with the SEC. Forward-looking statements relate to the date initially made, and Kohl’s undertakes no obligation to update them.

In this press release, the Company provides information regarding adjusted net income (loss) and adjusted diluted earnings (loss) per share, which are not recognized terms under U.S. generally accepted accounting principles (“GAAP”) and do not purport to be alternatives to net income as a measure of operating performance. A reconciliation of adjusted net income (loss) and adjusted diluted earnings (loss) per share is provided in this release. The Company believes that the use of these non-GAAP financial measures provides investors with enhanced visibility into its results with respect to the impact of certain costs. Because not all companies use identical calculations, these presentations may not be comparable to other similarly titled measures of other companies.

About Kohl's

Kohl’s (NYSE: KSS) is a leading omnichannel retailer. With more than 1,100 stores in 49 states and the online convenience of Kohls.com and the Kohl's App, Kohl's offers amazing national and exclusive brands at incredible savings for families nationwide. Kohl’s is uniquely positioned to deliver against its strategy and its vision to be the most trusted retailer of choice for the active and casual lifestyle. Kohl’s is committed to progress in its diversity and inclusion pledges, and the company's environmental, social and corporate governance (ESG) stewardship. For a list of store locations or to shop online, visit Kohls.com. For more information about Kohl’s impact in the community or how to join our winning team, visit Corporate.Kohls.com or follow @KohlsNews on Twitter.

KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

Three Months Ended

(Dollars in Millions, Except per Share Data)

May 1, 2021

May 2, 2020

Net sales

$

3,662

 

$

2,160

 

Other revenue

 

225

 

 

268

 

Total revenue

 

3,887

 

 

2,428

 

Cost of merchandise sold

 

2,233

 

 

1,787

 

Gross margin rate

 

39.0

%

 

17.3

%

Operating expenses:

 

 

 

 

 

 

Selling, general, and administrative

 

1,170

 

 

1,066

 

As a percent of total revenue

 

30.1

%

 

43.9

%

Depreciation and amortization

 

211

 

 

227

 

Impairments, store closing, and other

 

 

 

66

 

Operating income (loss)

 

273

 

 

(718

)

Interest expense, net

 

67

 

 

58

 

Loss on extinguishment of debt

 

201

 

 

 

Income (loss) before income taxes

 

5

 

 

(776

)

(Benefit) provision for income taxes

 

(9

)

 

(235

)

Net income (loss)

$

14

 

$

(541

)

Average number of shares:

 

 

 

 

 

 

Basic

 

154

 

 

154

 

Diluted

 

156

 

 

154

 

Earnings (loss) per share:

 

 

 

 

 

 

Basic

$

0.09

 

$

(3.52

)

Diluted

$

0.09

 

$

(3.52

)

ADJUSTED NET INCOME (LOSS) AND DILUTED EARNINGS (LOSS) PER SHARE, NON-GAAP FINANCIAL MEASURES

(Unaudited)

 

 

(Dollars in Millions, Except per Share Data)

Three Months Ended

May 1, 2021

 

May 2, 2020

 

Net income (loss)

 

 

 

 

 

 

GAAP

$

14

 

$

(541

)

Impairments, store closing, and other

 

 

 

66

 

Loss on extinguishment of debt

 

201

 

 

 

Income tax impact of items noted above

 

(50

)

 

(20

)

Adjusted (non-GAAP)

$

165

 

$

(495

)

Diluted earnings (loss) per share

 

 

 

 

 

 

GAAP

$

0.09

 

$

(3.52

)

Impairments, store closing, and other

 

 

 

0.43

 

Loss on extinguishment of debt

 

1.29

 

 

 

Income tax impact of items noted above

 

(0.33

)

 

(0.13

)

Adjusted (non-GAAP)

$

1.05

 

$

(3.22

)

KOHL’S CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

(Dollars in Millions)

May 1, 2021

May 2, 2020

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

$

1,609

 

$

2,039

 

Merchandise inventories

 

2,667

 

 

3,557

 

Other

 

919

 

 

574

 

Total current assets

 

5,195

 

 

6,170

 

Property and equipment, net

 

6,653

 

 

7,169

 

Operating leases

 

2,392

 

 

2,373

 

Other assets

 

449

 

 

157

 

Total assets

$

14,689

 

$

15,869

 

Liabilities and Shareholders' Equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

$

1,378

 

$

1,866

 

Accrued liabilities

 

1,289

 

 

1,138

 

Current portion of:

 

 

 

 

 

 

Finance leases and financing obligations

 

112

 

 

124

 

Operating leases

 

159

 

 

159

 

Total current liabilities

 

2,938

 

 

3,287

 

Long-term debt

 

1,909

 

 

3,449

 

Finance leases and financing obligations

 

1,473

 

 

1,351

 

Operating leases

 

2,620

 

 

2,605

 

Deferred income taxes

 

242

 

 

165

 

Other long-term liabilities

 

390

 

 

222

 

Shareholders' equity

 

5,117

 

 

4,790

 

Total liabilities and shareholders' equity

$

14,689

 

$

15,869

 

KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

Three Months Ended

(Dollars in Millions)

May 1, 2021

May 2, 2020

Operating activities

 

 

 

 

 

 

Net income (loss)

$

14

 

$

(541

)

Adjustments to reconcile net income (loss) to net cash provided

 

 

 

 

 

 

by operating activities:

Depreciation and amortization

 

211

 

 

227

 

Share-based compensation

 

12

 

 

15

 

Deferred income tax expense

 

(65

)

 

(91

)

Impairments, store closing, and other costs

 

 

 

51

 

Loss on extinguishment of debt

 

201

 

 

 

Non-cash inventory costs

 

 

 

187

 

Non-cash lease expense

 

38

 

 

37

 

Other non-cash expense

 

7

 

 

5

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Merchandise inventories

 

(75

)

 

(205

)

Other current and long-term assets

 

31

 

 

(180

)

Accounts payable

 

(99

)

 

660

 

Accrued and other long-term liabilities

 

42

 

 

(78

)

Operating lease liabilities

 

(39

)

 

(34

)

Net cash provided by operating activities

 

278

 

 

53

 

Investing activities

 

 

 

 

 

 

Acquisition of property and equipment

 

(59

)

 

(162

)

Proceeds from sale of real estate

 

2

 

 

 

Net cash used in investing activities

 

(57

)

 

(162

)

Financing activities

 

 

 

 

 

 

Proceeds from issuance of debt

 

500

 

 

2,097

 

Deferred financing costs

 

(5

)

 

(19

)

Treasury stock purchases

 

(46

)

 

(8

)

Shares withheld for taxes on vested restricted shares

 

(22

)

 

(20

)

Dividends paid

 

(39

)

 

(108

)

Reduction of long-term borrowings

 

(1,044

)

 

(497

)

Premium paid on redemption of debt

 

(192

)

 

 

Finance lease and financing obligation payments

 

(33

)

 

(23

)

Proceeds from stock option exercises

 

1

 

 

 

Proceeds from financing obligations

 

 

 

3

 

Other

 

(3

)

 

 

Net cash (used in) provided by financing activities

 

(883

)

 

1,425

 

Net (decrease) increase in cash and cash equivalents

 

(662

)

 

1,316

 

Cash and cash equivalents at beginning of period

 

2,271

 

 

723

 

Cash and cash equivalents at end of period

$

1,609

 

$

2,039

 

 

Investor Relations:
Mark Rupe, (262) 703-1266, mark.rupe@kohls.com

Media:
Jen Johnson, (262) 703-5241, jen.johnson@kohls.com

Source: Kohl’s