KOHLS Corp - FORM 8-K - EX-99.1 - PRESS RELEASE DATED NOVEMBER 12, 2015 - November 12, 2015

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Kohl's Corporation Reports Third Quarter Financial Results

MENOMONEE FALLS, Wis.--(BUSINESS WIRE)--November 12, 2015-- Kohl’s Corporation (NYSE:KSS). Kohl’s Corporation today reported results for the quarter and year-to-date periods ended October 31, 2015.

 
Quarter
 
Year to Date
($ in millions)
2015
 
2014
 
Change
 
2015
 
2014
 
Change
Sales
$
4,427

 
$
4,374

 
1.2%
 
$
12,817

 
$
12,686

 
1.0%
Comparable store sales
1.0
%
 
(1.8
)%
 
-
 
0.8
%
 
(2.2
)%
 
-
Gross margin
37.1
%
 
37.2
 %
 
(10) bp
 
37.7
%
 
37.7
 %
 
-
Net income
 
 
 
 
 
 
 
 
 
 
 
Reported
$
120

 
$
142

 
(15)%
 
$
377

 
$
498

 
(24)%
Excluding loss on
 
 

 
 
 
 
 

 
 
extinguishment of debt
$
144

 
$
142

 
1%
 
$
484

 
$
498

 
(3)%
Diluted earnings per share
 
 
 
 
 
 
 
 
 
 
 
Reported
$
0.63

 
$
0.70

 
(10)%
 
$
1.92

 
$
2.43

 
(21)%
Excluding loss on
 
 
 
 
 
 
 
 
 
 
 
extinguishment of debt
$
0.75

 
$
0.70

 
7%
 
$
2.46

 
$
2.43

 
1%

Kevin Mansell, Kohl's chairman, chief executive officer and president, said, "Our 1% increase in sales was driven by strong back-to-school and late October selling periods offset by a weak September. Most of our key initiatives enjoyed strong success while weakness was concentrated in seasonal businesses."

Dividend
On November 11, 2015, Kohl's Board of Directors declared a quarterly cash dividend on the Company's common stock of $0.45 per share.  The dividend is payable December 23, 2015 to shareholders of record at the close of business on December 9, 2015.

Store Update
Kohl’s ended the quarter with 1,166 stores in 49 states, compared with 1,163 stores at the same time last year.

Loss on Extinguishment of Debt
During the quarter, the Company completed its $1.1 billion debt refinancing when it settled $318 million of debt that had been called in the second quarter. In conjunction with the refinancing, the Company incurred a debt extinguishment loss of $169 million, including $38 million which was recognized in the third quarter.
 
Third Quarter 2015 Earnings Conference Call
Kohl's will host its quarterly earnings conference call at 8:30 am ET on November 12, 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 for both the live call and the replay is 346897. 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. 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 1,166 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://www.youtube.com/Kohls)

Contacts
Investor Relations:
Wes McDonald, 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)
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Nine Months Ended
 
October 31,
2015
 
November 1,
2014
 
October 31, 2015
 
November 1, 2014
Net sales
$
4,427

 
$
4,374

 
$
12,817

 
$
12,686

Cost of merchandise sold
2,784

 
2,746

 
7,990

 
7,908

 
 
 
 
 
 
 
 
Gross margin
1,643

 
1,628

 
4,827

 
4,778

 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
Selling, general, and administrative
1,099

 
1,097

 
3,120

 
3,078

Depreciation and amortization
236

 
227

 
695

 
665

 
 
 
 
 
 
 
 
Operating income
308

 
304

 
1,012

 
1,035

 
 
 
 
 
 
 
 
Interest expense, net
81

 
85

 
248

 
255

 
 
 
 
 
 
 
 
Loss on extinguishment of debt
38

 
—

 
169

 
—

 
 
 
 
 
 
 
 
Income before income taxes
189

 
219

 
595

 
780

Provision for income taxes
69

 
77

 
218

 
282

 
 
 
 
 
 
 
 
Net income
$
120

 
$
142

 
$
377

 
$
498

 
 
 
 
 
 
 
 
Basic net income per share
$
0.63

 
$
0.70

 
$
1.93

 
$
2.44

Average number of shares
191

 
202

 
196

 
204

 
 
 
 
 
 
 
 
Diluted net income per share
$
0.63

 
$
0.70

 
$
1.92

 
$
2.43

Average number of shares
192

 
203

 
197

 
205

 
 
 
 
 
 
 
 
As a percent of net sales:
 
 
 
 
 
 
 
Gross margin
37.1
%
 
37.2
%
 
37.7
%
 
37.7
%
Selling, general and
 
 
 
 
 
 
 
administrative expenses
24.8
%
 
25.1
%
 
24.3
%
 
24.3
%
Operating income
7.0
%
 
6.9
%
 
7.9
%
 
8.2
%
Net income
2.7
%
 
3.2
%
 
2.9
%
 
3.9
%
 
 
 
 
 
 
 
 
Excluding loss on
 
 
 
 
 
 
 
extinguishment of debt:
 
 
 
 
 
 
 
Net income
$
144

 
$
142

 
$
484

 
$
498

Diluted net income per share
$
0.75

 
$
0.70

 
$
2.46

 
$
2.43

Net income as a percent of net sales
3.3
%
 
3.2
%
 
3.8
%
 
3.9
%






KOHL'S CORPORATION
CONSOLIDATED BALANCE SHEETS
(In Millions)
(Unaudited)
 
 
 
 
 
 
 
October 31,
2015
 
November 1,
2014
Assets
 
 
 
 
Current assets:
 
 
 
 
  Cash and cash equivalents
 
$
501

 
$
631

  Merchandise inventories
 
5,254

 
4,973

Income tax receivable
 
36

 
76

  Deferred income taxes
 
136

 
125

  Other
 
276

 
295

 
 
 
 
 
  Total current assets
 
6,203

 
6,100

 
 
 
 
 
Property and equipment, net
 
8,499

 
8,671

Other assets
 
196

 
243

 
 
 
 
 
  Total assets
 
$
14,898

 
$
15,014

 
 
 
 
 
Liabilities and Shareholders' Equity
 
 
 
 
Current liabilities:
 
 
 
 
Accounts payable
 
$
2,141

 
$
2,384

Accrued liabilities
 
1,244

 
1,162

Income taxes payable
 
28

 
24

Short-term debt
 
400

 
—

Current portion of capital lease
 
 
 
 
  and financing obligations
 
126

 
109

 
 
 
 
 
  Total current liabilities
 
3,939

 
3,679

 
 
 
 
 
Long-term debt
 
2,792

 
2,779

Capital lease and financing obligations
 
1,817

 
1,886

Deferred income taxes
 
305

 
293

Other long-term liabilities
 
571

 
572

Shareholders' equity
 
5,474

 
5,805

 
 
 
 
 
  Total liabilities and shareholders' equity
 
$
14,898

 
$
15,014







KOHL'S CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Millions)
(Unaudited)
 
Nine Months Ended
 
October 31,
2015
 
November 1,
2014
Operating activities
 
 
 
Net income
$
377

 
$
498

Adjustments to reconcile net income to net cash
 
 
 
provided by operating activities:
 
 
 
Depreciation and amortization
695

 
665

Share-based compensation
36

 
38

Excess tax benefits from share-based compensation
(10
)
 
(2
)
Deferred income taxes
(84
)
 
(37
)
Other non-cash revenues and expenses
23

 
19

Loss on extinguishment of debt
169

 
—

Changes in operating assets and liabilities:
 
 
 
Merchandise inventories
(1,433
)
 
(1,093
)
Other current and long-term assets
74

 
(1
)
Accounts payable
630

 
1,019

Accrued and other long-term liabilities
(6
)
 
(1
)
Income taxes
(64
)
 
(175
)
Net cash provided by operating activities
407

 
930

 
 
 
 
Investing activities
 
 
 
Acquisition of property and equipment
(551
)
 
(561
)
Sales of investments in auction rate securities
—

 
59

Other
3

 
6

Net cash used in investing activities
(548
)
 
(496
)
 
 
 
 
Financing activities
 
 
 
Treasury stock purchases
(789
)
 
(549
)
Shares withheld for taxes on vested restricted shares
(26
)
 
(17
)
Dividends paid
(264
)
 
(239
)
Proceeds from issuance of debt
1,098

 
—

Net borrowings under credit facilities
400

 
—

Deferred financing costs
(10
)
 
—

Reduction of long-term borrowings
(1,085
)
 
—

Premium paid on redemption of debt
(163
)
 
—

Capital lease and financing obligation payments
(83
)
 
(87
)
Proceeds from stock option exercises
146

 
111

Excess tax benefits from share-based compensation
10

 
2

Proceeds from financing obligations
1

 
5

Net cash used in financing activities
(765
)
 
(774
)
 
 
 
 
Net decrease in cash and cash equivalents
(906
)
 
(340
)
Cash and cash equivalents at beginning of period
1,407

 
971

Cash and cash equivalents at end of period
$
501

 
$
631



KOHLS Corp Reports