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| 8-K - 8-K - KOHLS Corp | a8k-q22013earningsrelease.htm |
Kohl's Corporation Reports Second Quarter Financial Results
MENOMONEE FALLS, Wis.--(BUSINESS WIRE)--August 15, 2013-- Kohl’s Corporation (NYSE:KSS). Kohl’s Corporation today reported results for the quarter and year-to-date period ended August 3, 2013.
Quarter | Year to Date | ||||||||||||||||||
($ in millions) | 2013 | 2012 | Change | 2013 | 2012 | Change | |||||||||||||
Sales | $ | 4,289 | $ | 4,205 | 2.0% | $ | 8,488 | $ | 8,447 | 0.5% | |||||||||
Comparable store sales | 0.9 | % | (2.7 | )% | - | (0.5 | )% | (1.3 | )% | - | |||||||||
Net income | $ | 231 | $ | 240 | (4)% | $ | 378 | $ | 394 | (4)% | |||||||||
Diluted earnings per share | $ | 1.04 | $ | 1.00 | 4% | $ | 1.70 | $ | 1.63 | 4% | |||||||||
Kevin Mansell, Kohl's chairman, president and chief executive officer, said, “We are pleased with our progress in the second quarter. Sales improved significantly over the first quarter and our gross margin improved over last year. Expenses were well-managed and we ended the quarter with inventory per store up mid-single digits while funding our E-Commerce growth. I would like to thank each of our associates for their contribution to our results."
Dividend
On August 13, 2013, Kohl's Board of Directors declared a quarterly cash dividend on the Company's common stock of $0.35 per share. The dividend is payable September 25, 2013 to shareholders of record at the close of business on September 11, 2013.
Store Update
Kohl’s ended the quarter with 1,155 stores in 49 states, compared with 1,134 stores at the same time last year. The Company opened nine new stores during the first quarter of 2013 and expects to open three new stores and remodel 30 stores in the Fall.
Earnings Guidance
The Company provided initial guidance for the fiscal quarter ending November 2, 2013 of $0.83 to $0.92 per diluted share. The guidance is based on total sales growth of 1 to 3 percent and comparable store sales growth of 0 to 2 percent. The Company also updated its annual earnings per share guidance from $4.15 - $4.45 to $4.15 to $4.35.
Second Quarter 2013 Earnings Conference Call
Kohl's will host a second quarter earnings conference call at 8:30 am ET on August 15, 2013. The phone number for the conference call is (706) 902-0486. Replays of the call will be available for 30 days by dialing (855) 859-2056 or (404) 537-3406. The conference ID for both the live call and the replay is 94952764. The conference call and replays are also accessible via the Company's web site at http://www.kohlscorporation.com/InvestorRelations/event-calendar.htm.
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. With a commitment to environmental leadership, Kohl’s operates 1,155 stores in 49 states. In support of the communities it serves, Kohl’s has raised more than $231 million for children’s initiatives nationwide through its Kohl’s Cares® cause merchandise program, which operates under Kohl's Cares, LLC, a wholly-owned subsidiary of Kohl's Department Stores, Inc. For a list of store locations and information, or for the added convenience of shopping online, visit www.Kohls.com, join the discussion on Facebook (http://www.facebook.com/kohls) or Twitter (http://twitter.com/Kohls) or get inspired on Pinterest (http://pinterest.com/kohls/) and Instagram (http://instagram.com/kohls).
Contacts
Investor Relations:
Wes McDonald, Senior Executive Vice President and Chief Financial Officer, (262) 703-1893
Joanne Crevoiserat, Executive Vice President - Finance, (262) 703-2945
Media:
Jen Johnson, Director - Public Relations, (262) 703-5241
KOHL'S CORPORATION | |||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||
(In Millions, except per share data) | |||||||||||||||
(Unaudited) | |||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||
August 3, 2013 | July 28, 2012 | August 3, 2013 | July 28, 2012 | ||||||||||||
Net sales | $ | 4,289 | $ | 4,205 | $ | 8,488 | $ | 8,447 | |||||||
Cost of merchandise sold | 2,613 | 2,563 | 5,284 | 5,281 | |||||||||||
Gross margin | 1,676 | 1,642 | 3,204 | 3,166 | |||||||||||
Operating expenses: | |||||||||||||||
Selling, general, and administrative | 1,000 | 975 | 1,997 | 1,977 | |||||||||||
Depreciation and amortization | 225 | 210 | 439 | 411 | |||||||||||
Operating income | 451 | 457 | 768 | 778 | |||||||||||
Interest expense, net | 84 | 80 | 167 | 162 | |||||||||||
Income before income taxes | 367 | 377 | 601 | 616 | |||||||||||
Provision for income taxes | 136 | 137 | 223 | 222 | |||||||||||
Net income | $ | 231 | $ | 240 | $ | 378 | $ | 394 | |||||||
Basic net income per share | $ | 1.05 | $ | 1.01 | $ | 1.71 | $ | 1.64 | |||||||
Average number of shares | 220 | 238 | 221 | 240 | |||||||||||
Diluted net income per share | $ | 1.04 | $ | 1.00 | $ | 1.70 | $ | 1.63 | |||||||
Average number of shares | 222 | 239 | 222 | 242 | |||||||||||
As a percent of net sales: | |||||||||||||||
Gross margin | 39.1 | % | 39.0 | % | 37.7 | % | 37.5 | % | |||||||
Selling, general and | |||||||||||||||
administrative expenses | 23.3 | % | 23.2 | % | 23.5 | % | 23.4 | % | |||||||
Operating income | 10.5 | % | 10.9 | % | 9.0 | % | 9.2 | % | |||||||
Net income | 5.4 | % | 5.7 | % | 4.5 | % | 4.7 | % | |||||||
KOHL'S CORPORATION | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
(In Millions) | ||||||||
(Unaudited) | ||||||||
August 3, 2013 | July 28, 2012 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 592 | $ | 600 | ||||
Merchandise inventories | 3,856 | 3,521 | ||||||
Deferred income taxes | 150 | 109 | ||||||
Other | 284 | 260 | ||||||
Total current assets | 4,882 | 4,490 | ||||||
Property and equipment, net | 8,891 | 9,010 | ||||||
Long-term investments | 58 | 102 | ||||||
Other assets | 266 | 254 | ||||||
Total assets | $ | 14,097 | $ | 13,856 | ||||
Liabilities and Shareholders' Equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 1,396 | $ | 1,531 | ||||
Accrued liabilities | 1,065 | 1,001 | ||||||
Income taxes payable | 75 | 24 | ||||||
Current portion of capital lease | ||||||||
and financing obligations | 147 | 94 | ||||||
Total current liabilities | 2,683 | 2,650 | ||||||
Long-term debt | 2,492 | 2,141 | ||||||
Capital lease and financing obligations | 1,948 | 1,997 | ||||||
Deferred income taxes | 381 | 411 | ||||||
Other long-term liabilities | 540 | 469 | ||||||
Shareholders' equity | 6,053 | 6,188 | ||||||
Total liabilities and shareholders' equity | $ | 14,097 | $ | 13,856 | ||||
KOHL'S CORPORATION | |||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(In Millions) | |||||||
(Unaudited) | |||||||
Six Months Ended | |||||||
August 3, 2013 | July 28, 2012 | ||||||
Operating activities | |||||||
Net income | $ | 378 | $ | 394 | |||
Adjustments to reconcile net income to net cash | |||||||
provided by operating activities: | |||||||
Depreciation and amortization | 439 | 411 | |||||
Share-based compensation | 27 | 24 | |||||
Excess tax benefits from share-based compensation | (2 | ) | (3 | ) | |||
Deferred income taxes | (12 | ) | (13 | ) | |||
Other non-cash revenues and expenses | 18 | 8 | |||||
Changes in operating assets and liabilities: | |||||||
Merchandise inventories | (103 | ) | (300 | ) | |||
Other current and long-term assets | 22 | 40 | |||||
Accounts payable | 89 | 298 | |||||
Accrued and other long-term liabilities | (20 | ) | (166 | ) | |||
Income taxes | (74 | ) | (111 | ) | |||
Net cash provided by operating activities | 762 | 582 | |||||
Investing activities | |||||||
Acquisition of property and equipment | (284 | ) | (429 | ) | |||
Sales of investments in auction rate securities | 1 | 51 | |||||
Other | 13 | 2 | |||||
Net cash used in investing activities | (270 | ) | (376 | ) | |||
Financing activities | |||||||
Treasury stock purchases | (279 | ) | (623 | ) | |||
Dividends paid | (153 | ) | (153 | ) | |||
Proceeds from financing obligations | — | 4 | |||||
Capital lease and financing obligation payments | (52 | ) | (61 | ) | |||
Proceeds from stock option exercises | 46 | 19 | |||||
Excess tax benefits from share-based compensation | 2 | 3 | |||||
Deferred financing costs | (1 | ) | — | ||||
Net cash used in financing activities | (437 | ) | (811 | ) | |||
Net increase (decrease) in cash and cash equivalents | 55 | (605 | ) | ||||
Cash and cash equivalents at beginning of period | 537 | 1,205 | |||||
Cash and cash equivalents at end of period | $ | 592 | $ | 600 | |||