EX-99.1 3 exh991.htm PRESS RELEASE

Exhibit 99.1


National & Retail Trades and First Call, Release: November 15, 2007 at 4:00 PM (EST)



KOHL'S CORPORATION REPORTS THIRD QUARTER EARNINGS RESULTS



MENOMONEE FALLS, WI … November 15/BUSINESS WIRE/Kohl’s Corporation (NYSE:KSS). Kohl’s Corporation today reported net sales and earnings for the third quarter ended November 3, 2007.


Kohl’s Corporation third quarter earnings per diluted share were $0.61 in 2007 compared with $0.68 in last year’s period.  Net income was $194.0 million compared with $224.5 million a year ago, a decrease of 13.6 percent.  Net sales increased to $3.8 billion from $3.7 billion a year ago, an increase of 4.8 percent for the quarter.  Comparable store sales decreased 2.6 percent for the same period.


For the nine months ended November 3, 2007, net income increased 7.7 percent to $672.2 million or $2.09 per diluted share, compared to $624.1 million or $1.85 per diluted share for the nine months ended October 28, 2006. Net sales increased 8.3 percent to $11.0 billion from $10.1 billion a year ago. Comparable store sales increased 0.7 percent for the same period.

Larry Montgomery, Kohl’s Chairman and Chief Executive Officer, said, “Our sales results reflected a difficult overall environment.  We continued to operate our business in a conservative manner, managing inventory investment as we continued our improvement in gross margin while reducing expenses where possible without hurting the customer’s in-store experience.”  


Montgomery added, “I am very proud of our associates and the role they played in delivering these results and want to thank them for their hard work, loyalty and dedication to serving our customers.  They are the reason you can continue to ‘expect great things’ from Kohl’s.”


Earnings Guidance

For the fourth quarter, assuming comparable sales of flat to (2)%, the Company would expect earnings per diluted share of $1.45 to $1.51.  This would result in earnings per diluted share of $3.52 to $3.58 for fiscal 2007 versus its previous guidance of $3.77 to $3.87 per diluted share. This would result in an increase of 6 percent to 8 percent over last year’s $3.31 per diluted share.  


Expansion Update


During the month of September, the Company opened 80 new stores.  The Company operated 914 stores in 47 states as of November 3, 2007, compared with 814 stores in 45 states at the same time last year.


The Company opened 15 additional stores on November 11.  This completed the opening of 112 stores in fiscal 2007.   




Third Quarter Earnings Conference Call


Investors will have the opportunity to listen to the conference call scheduled for 5:00 PM EST on November 15 by dialing (913) 905-3179 (Pass Code: 4574912) ten minutes prior to the start of the call.  A replay of the conference call will be accessible from 8 PM EST November 15 through midnight December 14, 2007, by dialing (719) 457-0820 (Pass Code: 457912).


In addition, the call will be web cast live over the Internet through the Company’s web site located at http://www.kohls.com (see “Investor Relations” / “Calendar of Events”), or through Premiere Global’s web site at https://cis.premconf.com/sc/scw.dll/usr?cid=vlllrcdrznnvmddxm.  To listen to the call, please go to either web site at least 15 minutes early to register, download, and install any necessary audio software.  The web cast will be available for 30 days on both web sites.


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. A company committed to the communities it serves, Kohl’s operates 929 stores in 47 states and has raised more than $85 million for children’s initiatives nationwide through its Kohl’s Cares for Kids® philanthropic program.  For a list of store locations and information, or for the added convenience of shopping online, visit www.kohls.com.



Investor Relations Contact: Wes McDonald, Chief Financial Officer, (262) 703-1893

Media Contact:

Vicki Shamion, Vice President – Public Relations, (262) 703-1464




Kohl's Corporation

Condensed Consolidated Statements of Income

(In Millions, except per share data)

(Unaudited)

Subject to Reclassification

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months

 

Nine Months

 

 

 

 

 

(13 Weeks) Ended

 

(39 Weeks) Ended

 

 

 

 

 

 

  % to

 

 

% to

 

 

% to

 

 

% to

 

 

 

 

 

November 3,

  Net

 

October 28,

Net

 

November 3,

Net

 

October 28,

Net

 

 

 

 

 

2007

  Sales

 

2006

Sales

 

2007

Sales

 

2006

Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

 

 

 $    3,825.2

 

 

 $     3,650.5

 

 

 $   10,986.4

 

 

 $   10,148.3

 

Cost of merchandise sold

 

       2,407.2      

   62.9%

 

        2,299.6

    63.0%

 

       6,854.1

   62.4%

 

        6,402.7

   63.1%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 

 

       1,418.0

37.1%

 

        1,350.9

37.0%

 

       4,132.3

37.6%

 

        3,745.6

36.9%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general, and administrative

          933.7

24.4%

 

          858.7

23.5%

 

       2,630.0

23.9%

 

        2,387.3

23.5%

 

Depreciation and amortization

          115.2

3.0%

 

            94.3

2.6%

 

          326.0

3.0%

 

          283.7

2.8%

 

Preopening expenses

 

            38.2

1.1%

 

            28.5

0.8%

 

            55.6

0.5%

 

            47.6

0.5%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

          330.9

8.6%

 

          369.4

10.1%

 

       1,120.7

10.2%

 

        1,027.0

10.1%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

            18.7

0.4%

 

            10.2

0.3%

 

            39.4

0.4%

 

            30.4

0.3%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

          312.2

8.2%

 

          359.2

9.8%

 

       1,081.3

9.8%

 

          996.6

9.8%

Provision for income taxes

 

          118.2

3.1%

 

          134.7

3.7%

 

          409.1

3.7%

 

          372.5

3.7%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 $       194.0

5.1%

 

 $        224.5

6.1%

 

 $       672.2

6.1%

 

 $        624.1

6.1%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic net income per share

 $         0.61

 

 

 $         0.69

 

 

 $         2.10

 

 

 $         1.86

 

Average number of  shares

 

          316.9

 

 

          326.9

 

 

          319.7

 

 

          335.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income per share

 $         0.61

 

 

 $         0.68

 

 

 $         2.09

 

 

 $         1.85

 

Average number of  shares

 

          318.6

 

 

          329.8

 

 

          322.4

 

 

          338.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

Kohl's Corporation

Condensed Consolidated Statements of Cash Flows

(In Thousands)

(Unaudited)

Subject to Reclassification

 

 

 

 

 

 

 

 

39 Weeks Ended

 

 

 

November 3,

 

October 28,

 

 

2007

 

2006

 

 

 

 

 

Operating activities

 

 

 

Net income

 $     672,182

 

 $  624,098

Adjustments to reconcile net income to net cash

 

 

 

   provided by operating activities:

 

 

 

 

Depreciation and amortization

        326,549

 

     284,185

 

Amortization of debt discount

              192

 

           162

 

Share-based compensation

          40,439

 

       31,507

 

Excess tax benefits from share-based compensation

           (6,623)

 

      (20,480)

 

Deferred income taxes

           (7,295)

 

       29,448

 

Changes in operating assets and liabilities:

 

 

 

 

    Accounts receivable, net

                 -   

 

  1,652,065

 

    Merchandise inventories

    (1,330,448)

 

 (1,006,078)

 

    Other current and long-term assets

         (17,289)

 

      (64,362)

 

    Accounts payable

        774,515

 

     818,817

 

    Accrued and other long-term liabilities

          85,764

 

     131,192

 

    Income taxes

       (163,710)

 

      (89,931)

 

 

 

 

 

Net cash provided by operating activities

        374,276

 

  2,390,623

 

 

 

 

 

Investing activities

 

 

 

Acquisition of property and equipment

 

 

 

 

and favorable lease rights

    (1,332,154)

 

    (964,511)

Purchases of short-term investments

    (4,712,228)

 

 (9,744,469)

Sales of short-term investments

     5,117,779

 

  9,585,554

Proceeds from sale of property, plant and equipment

          30,197

 

             -   

Other

           (4,809)

 

       (3,856)

 

 

 

 

 

Net cash used in investing activities

       (901,215)

 

 (1,127,282)

 

 

 

 

 

Financing activities

 

 

 

Proceeds from issuance of debt

        996,031

 

             -   

Net borrowings under credit facilities

        170,000

 

             -   

Payments of long-term debt

         (16,644)

 

    (107,248)

Deferred financing fees

           (7,378)

 

             -   

Treasury stock purchases

       (612,475)

 

 (1,167,916)

Excess tax benefits from share-based compensation

            6,623

 

       20,480

Proceeds from stock option exercises

          96,598

 

       63,190

 

 

 

 

 

Net cash provided by (used in) financing activities

        632,755

 

 (1,191,494)

 

 

 

 

 

Net increase in cash and cash equivalents

        105,816

 

       71,847

Cash and cash equivalents at beginning of period

        189,170

 

     126,839

 

 

 

 

 

Cash and cash equivalents at end of period

 $     294,986

 

 $  198,686

 

 

 

 

 

 

 

 

 

 


Kohl's Corporation

Condensed Consolidated Balance Sheets

(In Thousands)

(Unaudited)

Subject to Reclassification

 

 

 

 

 

 

 

 

 

November 3,

 

October 28,

 

 

 

2007

                

2006

 

 

 

 

 

 

Assets

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 $     294,986

 

 $    198,686

 

Short-term investments

         25,679

 

       318,992

 

Merchandise inventories

     3,908,529

 

    3,234,793

 

Deferred income taxes

         62,291

 

        20,909

 

Other current assets

       139,125

 

       149,363

 

 

 

 

 

 

 

 

Total current assets

     4,430,610

 

    3,922,743

 

 

 

 

 

 

Property and equipment, net

     6,383,580

 

    5,266,048

Favorable lease rights, net

       213,298

 

       222,724

Goodwill

           9,338

 

          9,338

Other assets

         72,539

 

        57,224

 

 

 

 

 

 

 

 

Total assets

 $11,109,365

 

 $ 9,478,077

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 $  1,708,891

 

 $ 1,648,788

 

Accrued liabilities

       774,550

 

       721,534

 

Income taxes payable

         62,930

 

        56,497

 

Short-term debt

       170,000

 

               -   

 

Current portion of long-term debt and capital leases

         11,345

 

          8,809

 

 

 

 

 

 

 

 

Total current liabilities

     2,727,716

 

    2,435,628

 

 

 

 

 

 

Long-term debt and capital leases

     2,045,535

 

    1,040,450

Deferred income taxes

       258,336

 

       244,481

Other long-term liabilities

       268,873

 

       228,236

Shareholders' equity

     5,808,905

 

    5,529,282

 

 

 

 

 

 

 

 

Total liabilities and shareholders' equity

 $11,109,365

 

 $ 9,478,077