KSS
$44.32
Kohl's
$.60
1.37%
Earnings Details
3rd Quarter October 2017
Thursday, November 9, 2017 7:00:03 AM
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Summary

Kohl's Beats

Kohl's (KSS) reported 3rd Quarter October 2017 earnings of $0.70 per share on revenue of $4.3 billion. The consensus earnings estimate was $0.72 per share on revenue of $4.3 billion. The Earnings Whisper number was $0.69 per share. Revenue grew 0.1% on a year-over-year basis.

The company said it expects fiscal year earnings of $3.60 to $3.80 per share. The company's previous guidance was earnings of $3.50 to $3.80 per share and the current consensus earnings estimate is $3.72 per share for the year ending January 31, 2018.

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

Results
Reported Earnings
$0.70
Earnings Whisper
$0.69
Consensus Estimate
$0.72
Reported Revenue
$4.33 Bil
Revenue Estimate
$4.30 Bil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Kohl’s Corporation Reports Third Quarter Financial Results

Kohl’s Corporation (KSS) today reported results for the three and nine month periods ended October 28, 2017.

Three Months Ended
Nine Months Ended
($ in millions)
2017
2016
Change
2017
2016
Change
Total sales
$
4,332
$
4,327
0.1%
$
12,319
$
12,481
(1.3)%
Comparable sales
0.1 %
(1.7 )%
--
(1.0 )%
(2.4 )%
--
Gross margin
36.8 %
37.1 %
(30) bp
37.6 %
37.4 %
15 bp
Selling, general, and administrative expenses
$
1,095
$
1,080
1.4%
$
3,053
$
3,074
(0.7)%
Reported
Net income
$
117
$
146
(20)%
$
391
$
303
29%
Diluted earnings per share
$
0.70
$
0.83
(16)%
$
2.32
$
1.68
39%
Excluding non-recurring items*
Net income
$
117
$
142
(18)%
$
391
$
420
(7)%
Diluted earnings per share
$
0.70
$
0.80
(13)%
$
2.32
$
2.33
0%
*Excludes Impairments, store closing and other costs in 2016.

Kevin Mansell, Kohl’s chairman, chief executive officer and president, said, "We are pleased to report an increase in comp sales for the quarter as the traffic momentum we saw in the first half of the year continued. We saw strong results during the back-to-school season, achieving a low single-digit positive comp. The middle of the quarter was soft as we experienced disruptions from the hurricanes and other unseasonal weather. The quarter closed with strong sales in the second half of October."

Dividend

On November 8, 2017, the Kohl’s Board of Directors declared a quarterly cash dividend on the Company’s common stock of $0.55 per share. The dividend is payable December 20, 2017 to shareholders of record at the close of business on December 6, 2017.

Store Update

Kohl’s ended the quarter with 1,156 Kohl’s stores in 49 states compared with 1,155 Kohl’s stores at the same time last year. Kohl’s also operates 12 FILA Outlets and four Off/Aisle clearance centers.

Earnings Guidance Update

The Company now expects fiscal 2017 diluted earnings per share of $3.72 to $3.92, which includes the impact of a fourth quarter tax settlement. The Company expects to receive a pre-tax benefit of $30 million from this state tax settlement which will be recorded through its tax rate. Excluding the impact of the tax settlement, the Company expects diluted earnings per share of $3.60 to $3.80, compared to its prior guidance of $3.50 to $3.80 per diluted share.

Third Quarter 2017 Earnings Conference Call

Kohl’s will host its quarterly earnings conference call at 8:30 am ET on November 9, 2017. The phone number for the conference call is (800) 230-1085. 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 413291. The conference call and replays are also accessible via the Company’s web site at http://corporate.kohls.com/investors/events-and-presentations.

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 (KSS) is a leading omnichannel retailer with more than 1,100 stores in 49 states. With a commitment to inspiring and empowering families to lead fulfilled lives, Kohl’s offers amazing national and exclusive brands, incredible savings and an easy shopping experience in our stores, online at Kohls.com and on Kohl’s mobile app. Throughout its history, Kohl’s has given nearly $600 million to support communities nationwide. For a list of store locations or to shop online, visit Kohls.com. For more information about Kohl’s impact in the community and how to join our winning team, visit Corporate.Kohls.com.

KOHL’S CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended
Nine Months Ended
(Dollars in Millions, Except per Share Data)
October 28,
October 29,
October 28,
October 29,
2017
2016
2017
2016
Net sales
$4,332
$4,327
$12,319
$12,481
Cost of merchandise sold
2,737
2,720
7,693
7,812
Gross margin
1,595
1,607
4,626
4,669
As a percent of net sales
36.8%
37.1%
37.6%
37.4%
Operating expenses:
Selling, general, and administrative
1,095
1,080
3,053
3,074
As a percent of net sales
25.3%
25.0%
24.8%
24.6%
Depreciation and amortization
243
232
724
700
Impairments, store closing and other costs
--
(6)
--
186
Operating income
257
301
849
709
Interest expense, net
74
76
225
233
Income before income taxes
183
225
624
476
Provision for income taxes
66
79
233
173
Net income
$117
$146
$391
$303
Average number of shares:
Basic
166
177
168
180
Diluted
166
177
168
180
Net income per share:
Basic
$0.70
$0.83
$2.33
$1.68
Diluted
$0.70
$0.83
$2.32
$1.68
Excluding non-recurring items*
Net income
$117
$142
$391
$420
Diluted net income per share
$0.70
$0.80
$2.32
$2.33
*Excludes Impairments, store closing and other costs in 2016.
KOHL’S CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in Millions)
October 28,
October 29,
2017
2016
Assets
Current assets:
Cash and cash equivalents
$736
$597
Merchandise inventories
4,632
4,721
Other
332
336
Total current assets
5,700
5,654
Property and equipment, net
7,974
8,203
Other assets
226
219
Total assets
$13,900
$14,076
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable
$2,113
$2,097
Accrued liabilities
1,237
1,235
Income taxes payable
24
66
Current portion of capital lease and financing obligations
131
128
Total current liabilities
3,505
3,526
Long-term debt
2,796
2,794
Capital lease and financing obligations
1,622
1,702
Deferred income taxes
275
298
Other long-term liabilities
673
649
Shareholders’ equity
5,029
5,107
Total liabilities and shareholders’ equity
$13,900
$14,076
KOHL’S CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
(Dollars in Millions)
October 28,
October 29,
2017
2016
Operating activities
Net income
$391
$303
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization
724
700
Share-based compensation
34
31
Deferred income taxes
2
40
Impairments, store closing and other costs
--
57
Other non-cash revenues and expenses
(4)
20
Changes in operating assets and liabilities:
Merchandise inventories
(829)
(679)
Other current and long-term assets
47
20
Accounts payable
606
846
Accrued and other long-term liabilities
(11)
23
Income taxes
(91)
(77)
Net cash provided by operating activities
869
1,284
Investing activities
Acquisition of property and equipment
(547)
(591)
Proceeds from sale of property and equipment
18
7
Net cash used in investing activities
(529)
(584)
Financing activities
Treasury stock purchases
(288)
(441)
Shares withheld for taxes on vested restricted shares
(12)
(15)
Dividends paid
(277)
(270)
Capital lease and financing obligation payments
(101)
(95)
Proceeds from stock option exercises
--
6
Proceeds from financing obligations
--
5
Net cash used in financing activities
(678)
(810)
Net decrease in cash and cash equivalents
(338)
(110)
Cash and cash equivalents at beginning of period
1,074
707
Cash and cash equivalents at end of period
$736
$597

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SOURCE: Kohl’s Corporation

Kohl’s Corporation
Investor Relations:
Jill Timm, (262) 703-2203
jill.timm@kohls.com
or
Media:
Jen Johnson, (262) 703-5241
jen.johnson@kohls.com