KOHLS Corp - FORM 8-K - EX-99.1 - PRESS RELEASE DATED FEBRUARY 26, 2015 - February 26, 2015

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Kohl's Corporation Reports Financial Results
•
Reports fourth quarter earnings of $1.83 per diluted share, a 17% increase
•
Issues fiscal 2015 guidance of $4.40 to $4.60 per diluted share
•
Authorizes 15% increase in dividends per share

MENOMONEE FALLS, Wis.--(BUSINESS WIRE)--February 26, 2015-- Kohl’s Corporation (NYSE:KSS). Kohl’s Corporation today reported results for the quarter and year ended January 31, 2015.
 
Quarter
 
Year
($ in millions, except per share amounts)
2014
 
2013
 
Change
 
2014
 
2013
 
Change
Total sales
$6,337
 
$6,099
 
3.9
%
 
$19,023
 
$19,031
 
—
 %
Comparable store sales
3.7
%
 
(2.0
)%
 
-
 
(0.3
)%
 
(1.2
)%
 
-
Net income
$369
 
$334
 
10%
 
$867
 
$889
 
(2)%
Diluted earnings per share
$1.83
 
$1.56
 
17%
 
$4.24
 
$4.05
 
5%
 
 
 
 
 
 
 
 
 
 
 
 

Kevin Mansell, Kohl’s chairman, president and chief executive officer, said, "Our fourth quarter results showed significant improvement as many of our Greatness Agenda initiatives took hold.  Our 3.7% increase in comparable sales was driven by both transactions per store - a key area of focus - and average transaction value.  The sales strength was broad as all lines of business and all geographic regions reported higher sales. Our teams managed both expenses and inventories well, allowing us to exceed our previous earnings guidance."

Dividend
On February 25, 2015 Kohl's Board of Directors declared a quarterly cash dividend on the Company's common stock of $0.45 per share, a 15% increase over its prior dividend. The dividend is payable March 25, 2015 to shareholders of record at the close of business on March 11, 2015.

Store Update
Kohl’s ended the fiscal year with 1,162 stores in 49 states. During 2014, the Company opened seven stores in new locations, relocated two existing stores, and closed three stores.

Initial 2015 Earnings Guidance
The Company expects earnings per diluted share of $4.40 to $4.60 for fiscal 2015. This guidance is based on the following assumptions:
•
Total sales increase of 1.8% to 2.8%
•
Comparable sales increase of 1.5% to 2.5%
•
Gross margin as a percentage of sales to increase 0 to 20 basis points over 2014
•
SG&A expense to increase 1.5% to 2.5% over 2014
•
Depreciation expense to be $940 million
•
Interest expense to be $335 million
•
Effective tax rate of 37%
•
$1 billion in share repurchases at an average price of $70 per share
•
Capital expenditures of $800 million








Fourth Quarter 2014 Earnings Conference Call
Kohl's will host its quarterly earnings conference call at 8:30 am ET on February 26, 2015. The phone number for the conference call is (800) 230-1074. Replays of the call will be available for 30 days by dialing (800) 475-6701.  The conference ID is 346898. 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 2015 earnings guidance. 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 (NYSE: KSS) is a leading specialty department store with 1,162 stores in 49 states. With a commitment to inspiring and empowering families to lead fulfilled lives, the company offers amazing national and exclusive brands, incredible savings and inspiring shopping experiences in-store, online at Kohls.com and via mobile devices. Committed to its communities, Kohl’s has raised more than $274 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 additional information about Kohl’s philanthropic and environmental initiatives, visit www.Kohls.com/Cares. For a list of store locations and information, or for the added convenience of shopping online, visit www.Kohls.com.

Connect with Kohl’s:
Facebook (http://www.facebook.com/Kohls)
Twitter (http://twitter.com/Kohls)
Google+ (http://plus.google.com/+Kohls)
Pinterest (http://pinterest.com/Kohls)
Instagram (http://instagram.com/Kohls)
YouTube (http://youtube.com/Kohls)


Contacts
Investor Relations:
Wes McDonald, Senior Executive Vice President and Chief Financial Officer, (262) 703-1893

Media:
Bevin Bailis, SVP, PR and Communications, (262) 703-1464





KOHL'S CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(In Millions, except per share data)
(Unaudited)
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Year Ended
 
Jan 31,
2015
 
Feb 1,
2014
 
Jan 31,
2015
 
Feb 1,
2014
 
 
 
 
 
 
 
 
Net sales
$
6,337

 
$
6,099

 
$
19,023

 
$
19,031

Cost of merchandise sold
4,190

 
4,024

 
12,098

 
12,087

 
 
 
 
 
 
 
 
Gross margin
2,147

 
2,075

 
6,925

 
6,944

 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
Selling, general, and administrative
1,272

 
1,242

 
4,350

 
4,313

Depreciation and amortization
221

 
224

 
886

 
889

 
 
 
 
 
 
 
 
Operating income
654

 
609

 
1,689

 
1,742

 
 
 
 
 
 
 
 
Interest expense, net
84

 
87

 
340

 
338

 
 
 
 
 
 
 
 
Income before income taxes
570

 
522

 
1,349

 
1,404

Provision for income taxes
201

 
188

 
482

 
515

 
 
 
 
 
 
 
 
Net income
$
369

 
$
334

 
$
867

 
$
889

 
 
 
 
 
 
 
 
Basic net income per share
$
1.85

 
$
1.57

 
$
4.28

 
$
4.08

Average number of shares
199

 
213

 
203

 
218

 
 
 
 
 
 
 
 
Diluted net income per share
$
1.83

 
$
1.56

 
$
4.24

 
$
4.05

Average number of shares
201

 
215

 
204

 
220

 
 
 
 
 
 
 
 
As a percent of net sales:
 
 
 
 
 
 
 
Gross margin
33.9
%
 
34.0
%
 
36.4
%
 
36.5
%
Selling, general and
 
 
 
 
 
 
 
administrative expenses
20.1
%
 
20.4
%
 
22.9
%
 
22.7
%
Operating income
10.3
%
 
10.0
%
 
8.9
%
 
9.2
%
Net income
5.8
%
 
5.5
%
 
4.6
%
 
4.7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 





KOHL'S CORPORATION
CONSOLIDATED BALANCE SHEETS
(In Millions)
(Unaudited)
 
 
 
 
 
 
 
Jan 31,
2015
 
Feb 1,
2014
Assets
 
 
 
 
Current assets:
 
 
 
 
Cash and cash equivalents
 
$
1,407

 
$
971

Merchandise inventories
 
3,814

 
3,874

Deferred income taxes
 
116

 
142

Other
 
361

 
327

 
 
 
 
 
Total current assets
 
5,698

 
5,314

 
 
 
 
 
Property and equipment, net
 
8,515

 
8,745

Other assets
 
218

 
298

 
 
 
 
 
Total assets
 
$
14,431

 
$
14,357

 
 
 
 
 
Liabilities and Shareholders' Equity
 
 
 
 
Current liabilities:
 
 
 
 
Accounts payable
 
$
1,511

 
$
1,365

Accrued liabilities
 
1,160

 
1,138

Income taxes payable
 
78

 
116

Current portion of capital lease
 
 
 
 
and financing obligations
 
110

 
139

 
 
 
 
 
Total current liabilities
 
2,859

 
2,758

 
 
 
 
 
Long-term debt
 
2,793

 
2,792

Capital lease and financing obligations
 
1,858

 
1,930

Deferred income taxes
 
368

 
339

Other long-term liabilities
 
562

 
560

Shareholders' equity
 
5,991

 
5,978

 
 
 
 
 
Total liabilities and shareholders' equity
 
$
14,431

 
$
14,357

 
 
 
 
 
 
 
 
 
 












KOHL'S CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Millions)
(Unaudited)
 
 
2014
 
2013
 
 
 
 
Operating activities
 
 
 
Net income
$
867

 
$
889

Adjustments to reconcile net income to net cash
 
 
 
provided by operating activities:
 
 
 
Depreciation and amortization
886

 
889

Share-based compensation
48

 
55

Excess tax benefits from share-based compensation
(3
)
 
(3
)
Deferred income taxes
46

 
(11
)
Other non-cash revenues and expenses
31

 
43

Changes in operating assets and liabilities:
 
 
 
Merchandise inventories
68

 
(116
)
Other current and long-term assets
(33
)
 
(19
)
Accounts payable
146

 
58

Accrued and other long-term liabilities
33

 
149

Income taxes
(65
)
 
(50
)
 
 
 
 
Net cash provided by operating activities
2,024

 
1,884

 
 
 
 
Investing activities
 
 
 
Acquisition of property and equipment
(682
)
 
(643
)
Sales of investments in auction rate securities
82

 
1

Other
7

 
19

 
 
 
 
Net cash used in investing activities
(593
)
 
(623
)
 
 
 
 
Financing activities
 
 
 
Treasury stock purchases
(677
)
 
(799
)
Shares withheld for restricted shares
(19
)
 
(13
)
Dividends paid
(317
)
 
(302
)
Proceeds from issuance of debt, net
—

 
296

Proceeds from financing obligations
6

 
1

Capital lease and financing obligation payments
(114
)
 
(115
)
Proceeds from stock option exercises
123

 
102

Excess tax benefits from share-based compensation
3

 
3

 
 
 
 
Net cash used in financing activities
(995
)
 
(827
)
 
 
 
 
Net increase in cash and cash equivalents
436

 
434

Cash and cash equivalents at beginning of period
971

 
537

 
 
 
 
Cash and cash equivalents at end of period
$
1,407

 
$
971





KOHLS Corp Reports