KSS

KOHLS CORP

Consumer Cyclical | Mid Cap

$0.30

EPS Forecast

$3,803

Revenue Forecast

Announcing earnings for the quarter ending 2024-10-31 soon
EX-99.1 2 kss-ex991_63.htm EX-99.1 kss-ex991_63.htm

Exhibit 99.1

Kohl's Corporation Reports Financial Results

 

 

Fourth quarter comparable sales flat

 

Fourth quarter diluted earnings per share of $1.72

 

Fourth quarter adjusted diluted earnings per share(1) of $1.99

 

MENOMONEE FALLS, Wis.--(BUSINESS WIRE)—March 3, 2020-- Kohl’s Corporation (NYSE:KSS) today reported results for the quarter and year ended February 1, 2020.

 

 

Three Months

Twelve Months

($ in millions, except per share data)

 

2019

2018

Change

 

2019

2018

Change

Total revenue

$

6,832

 

$

6,823

 

 

0.1

%

$

19,974

 

$

20,229

 

 

(1.3

)%

Comparable sales

0.0

%

 

1.0

%

 

 

 

 

(1.3

)%

 

1.7

%

 

 

 

Gross margin

 

32.7

%

 

33.5

%

(81) bps

 

 

35.7

%

 

36.4

%

(64) bps

 

Selling, general, and administrative expenses

$

1,742

 

$

1,694

 

 

2.8

%

$

5,705

 

$

5,601

 

 

1.9

%

Reported

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     Net income

$

265

 

$

272

 

 

(3

)%

$

691

 

$

801

 

 

(14

)%

     Diluted earnings per share

$

1.72

 

$

1.67

 

 

3

%

$

4.37

 

$

4.84

 

 

(10

)%

Non-GAAP(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     Net income

$

308

 

$

366

 

 

(16

)%

$

769

 

$

927

 

 

(17

)%

     Diluted earnings per share

$

1.99

 

$

2.24

 

 

(11

)%

$

4.86

 

$

5.60

 

 

(13

)%

(1) Excludes Impairments, store closing and other costs, and (Gain) loss on extinguishment of debt.

 

Michelle Gass, Kohl's chief executive officer, said, "While 2019 was a year in which our financial results did not meet our expectations, it was also a year of innovation and investment that further strengthened Kohl’s differentiation in the market. We are encouraged by the acceleration of traffic and new customer acquisition in our stores and online driven by the unprecedented level of new brands and partnerships we launched during the year. I want to thank all of our associates for their ongoing commitment to Kohl’s and I am confident that we will build on our strengths in 2020 to stabilize and position the business for future growth.”

 

Dividend

On February 26, 2020, Kohl's Board of Directors declared a quarterly cash dividend on the Company's common stock of $0.704 per share, a 5% increase over its prior dividend. The dividend is payable April 1, 2020 to shareholders of record at the close of business on March 18, 2020.

Initial 2020 Earnings Guidance

The Company expects earnings per diluted share of $4.20 to $4.60 for fiscal 2020. This guidance is based on the following assumptions, but excludes any non-recurring charges:

 

Comparable sales change of (1%) to 1%

 

Gross margin as a percentage of sales decrease of 10 to 20 basis points as compared to 2019

 

SG&A dollars increase of 1% to 2% over 2019

 

Depreciation expense of $940 million

 

Interest expense of $210 million

 

Effective tax rate of 24% to 25%

 

Fourth Quarter 2019 Earnings Conference Call

Kohl's will host its quarterly earnings conference call at 9:00 am ET on March 3, 2020. A webcast of the conference call will be available via the Company's web site at http://corporate.kohls.com/investors/events-and-presentations, both live and after the call.

 

Kohl’s Investor Day 2020

On March 16, 2020, the Company will host an investor day in New York City. The event will begin at 12:30 pm ET, with presentations to commence at 1:00 pm ET. Due to limited capacity, in-person attendance will be by invitation only. A webcast of the presentations and question and answer session will be available 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, including 2020 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. Forward-looking statements relate to the date initially made, and Kohl’s undertakes no obligation to update them.

About Kohl's

Kohl’s (NYSE: 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. Since its founding, Kohl's has given more than $750 million to support communities nationwide, with a focus on family health and wellness. 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.

 

Contacts

Investor Relations:

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

 

Media:

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

 


KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

 

 

Three Months Ended

Twelve Months Ended

(Dollars in Millions, Except per Share Data)

February 1,

2020

February 2,

2019

February 1,

2020

February 2,

2019

Net sales

$

6,537

 

$

6,535

 

$

18,885

 

$

19,167

 

Other revenue

 

295

 

 

288

 

 

1,089

 

 

1,062

 

     Total revenue

 

6,832

 

 

6,823

 

 

19,974

 

 

20,229

 

Cost of merchandise sold

 

4,400

 

 

4,345

 

 

12,140

 

 

12,199

 

     Gross margin rate

 

32.7

%

 

33.5

%

 

35.7

%

 

36.4

%

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

     Selling, general, and administrative

 

1,742

 

 

1,694

 

 

5,705

 

 

5,601

 

        As a percent of total revenue

 

25.5

%

 

24.8

%

 

28.6

%

 

27.7

%

     Depreciation and amortization

 

232

 

 

239

 

 

917

 

 

964

 

     Impairments, store closing and other costs

 

57

 

 

104

 

 

113

 

 

104

 

Operating income

 

401

 

 

441

 

 

1,099

 

 

1,361

 

Interest expense, net

 

50

 

 

58

 

 

207

 

 

256

 

(Gain) loss on extinguishment of debt

 

-

 

 

21

 

 

(9

)

 

63

 

Income before income taxes

 

351

 

 

362

 

 

901

 

 

1,042

 

Provision for income taxes

 

86

 

 

90

 

 

210

 

 

241

 

Net income

$

265

 

$

272

 

$

691

 

$

801

 

Average number of shares:

 

 

 

 

 

 

 

 

 

 

 

 

     Basic

 

154

 

 

162

 

 

157

 

 

164

 

     Diluted

 

154

 

 

163

 

 

158

 

 

165

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

     Basic

$

1.72

 

$

1.68

 

$

4.39

 

$

4.88

 

     Diluted

$

1.72

 

$

1.67

 

$

4.37

 

$

4.84

 

 

 

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

(Unaudited)

 

 

Three Months Ended

Twelve Months Ended

(Dollars in Millions, Except per Share Data)

February 1,

2020

 

February 2,

2019

 

February 1,

2020

 

February 2,

2019

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

   GAAP

$

265

 

$

272

 

$

691

 

$

801

 

   Impairments, store closing and other costs

 

43

 

 

78

 

 

85

 

 

78

 

   (Gain) loss on extinguishment of debt

 

-

 

 

16

 

 

(7

)

 

48

 

   Adjusted (non-GAAP)

$

308

 

$

366

 

$

769

 

$

927

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share

 

 

 

 

 

 

 

 

 

 

 

 

   GAAP

$

1.72

 

$

1.67

 

$

4.37

 

$

4.84

 

   Impairments, store closing and other costs

 

0.27

 

 

0.47

 

 

0.53

 

 

0.47

 

   (Gain) loss on extinguishment of debt

 

-

 

 

0.10

 

 

(0.04

)

 

0.29

 

   Adjusted (non-GAAP)

$

1.99

 

$

2.24

 

$

4.86

 

$

5.60

 

 


KOHL’S CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

(Dollars in Millions)

February 1,

2020

February 2,

2019

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

     Cash and cash equivalents

$

723

 

$

934

 

     Merchandise inventories

 

3,537

 

 

3,475

 

     Other

 

389

 

 

426

 

           Total current assets

 

4,649

 

 

4,835

 

Property and equipment, net

 

7,352

 

 

7,428

 

Operating leases

 

2,391

 

 

-

 

Other assets

 

163

 

 

206

 

           Total assets

$

14,555

 

$

12,469

 

Liabilities and Shareholders' Equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

     Accounts payable

$

1,206

 

$

1,187

 

     Accrued liabilities

 

1,233

 

 

1,364

 

     Income taxes payable

 

48

 

 

64

 

     Current portion of:

 

 

 

 

 

 

        Finance leases and financing obligations

 

124

 

 

115

 

        Operating leases

 

158

 

 

-

 

           Total current liabilities

 

2,769

 

 

2,730

 

Long-term debt

 

1,856

 

 

1,861

 

Finance leases and financing obligations

 

1,367

 

 

1,523

 

Operating leases

 

2,619

 

 

-

 

Deferred income taxes

 

260

 

 

184

 

Other long-term liabilities

 

234

 

 

644

 

Shareholders' equity

 

5,450

 

 

5,527

 

           Total liabilities and shareholders' equity

$

14,555

 

$

12,469

 


KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

Twelve Months Ended

(Dollars in Millions)

February 1,

2020

February 2,

2019

Operating activities

 

 

 

 

 

 

Net income

$

691

 

$

801

 

Adjustments to reconcile net income to net cash provided

   by operating activities:

 

 

 

 

 

 

      Depreciation and amortization

 

917

 

 

964

 

      Share-based compensation

 

56

 

 

87

 

      Deferred income taxes

 

51

 

 

(31

)

      Impairments, store closing and other costs

 

64

 

 

72

 

      (Gain) loss on extinguishment of debt

 

(9

)

 

63

 

      Non-cash lease expense

 

150

 

 

-

 

      Other non-cash expenses

 

11

 

 

18

 

      Changes in operating assets and liabilities:

 

 

 

 

 

 

            Merchandise inventories

 

(51

)

 

79

 

            Other current and long-term assets

 

24

 

 

72

 

            Accounts payable

 

19

 

 

(84

)

            Accrued and other long-term liabilities

 

(117

)

 

67

 

            Income taxes

 

7

 

 

(1

)

            Operating lease liabilities

 

(156

)

 

-

 

Net cash provided by operating activities

 

1,657

 

 

2,107

 

 

 

 

 

 

 

 

Investing activities

 

 

 

 

 

 

Acquisition of property and equipment

 

(855

)

 

(578

)

Other

 

18

 

 

6

 

Net cash used in investing activities

 

(837

)

 

(572

)

 

 

 

 

 

 

 

Financing activities

 

 

 

 

 

 

Treasury stock purchases

 

(470

)

 

(396

)

Shares withheld for taxes on vested restricted shares

 

(31

)

 

(34

)

Dividends paid

 

(423

)

 

(400

)

Reduction of long-term borrowings

 

(6

)

 

(943

)

Premium paid on redemption of debt

 

-

 

 

(46

)

Finance lease and financing obligation payments

 

(113

)

 

(126

)

Proceeds from stock option exercises

 

1

 

 

36

 

Proceeds from financing obligations

 

11

 

 

-

 

Net cash used in financing activities

 

(1,031

)

 

(1,909

)

Net decrease in cash and cash equivalents

 

(211

)

 

(374

)

Cash at beginning of period

 

934

 

 

1,308

 

Cash at end of period

$

723

 

$

934