Tags: Kohls | profit | net | earnings

Kohl's Sees Full-Year Profit Below View as Net Falls

Thursday, 28 Feb 2013 07:57 AM

Kohl's Corp. reported lower fourth-quarter profit on Thursday, hurt by markdowns during the holiday season, and forecast full-year earnings that fell short of Wall Street expectations.

The department store chain, which caters to price-sensitive middle-class shoppers, said it expects same-store sales to be flat to up 2 percent this year, following a modest 0.3 percent gain last year.

Kohl's sales forecast is below that of rival Macy's Inc's 3.5 percent and suggests the company does not expect to benefit much from the steep sales decline of its most direct rival, JC Penney Co. Inc. On Wednesday, Penney reported a 31.7 percent same-store sales decline last quarter.

Kohl's said net income fell to $378 million, or $1.66 per share, from $455 million, or $1.82 per share, a year earlier for the quarter ended Feb. 2. The latest EPS result was 3 cents better than analysts' targets, according to Thomson Reuters I/B/E/S.

Kohl's gross profit margin fell 2.9 points to 36.2 percent of sales, largely because of price slashing in December to lure hesitant shoppers holding out for deals, then again in January to clear shelves to make room for spring merchandise.

"Sales for the fourth quarter developed very late and as a result, came at a cost to profitability," Kohl's Chief Executive Kevin Mansell said in a statement, noting that cost controls had limited the damage.

Kohl's struggled with finding the right level of inventory last year. Some months it ran out of merchandise and was deprived sales, while other months it had too much and ended up slashing prices.

As previously reported, Kohl's comparable sales for the quarter that included the holiday season were up 1.9 percent. At Macy's, they rose 3.9 percent, and at Dillard's Inc, they gained 3 percent.

Kohl's expects a full-year profit for the new fiscal year of between $4.15 and $4.45 per share, while Wall Street projected $4.56 per share, according to Thomson Reuters I/B/E/S.

© 2015 Thomson/Reuters. All rights reserved.

1Like our page

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved