Exhibit 99.1
Kohl’s Reports First Quarter Fiscal 2024 Financial Results
MENOMONEE FALLS, Wis.–(BUSINESS WIRE)—May 30, 2024– Kohl’s Corporation (NYSE:KSS) today reported results for the first quarter ended May 4, 2024.
| | • | | Net sales decreased 5.3% and comparable sales decreased 4.4% |
| | • | | Regular price sales increased 2.4% with clearance impacting overall comp by more than 600 basis points |
| | • | | Gross margin increased 48 basis points |
| | • | | Diluted loss per share of $0.24 |
| | • | | Updates full year 2024 financial outlook |
| | • | | Committed to returning capital to shareholders through the dividend and further strengthening balance sheet through long-term debt reduction in 2024 |
Tom Kingsbury, Kohl’s chief executive officer, said “Our first quarter results did not meet our expectations and are not reflective of the direction we are heading with our strategic initiatives. Regular price sales increased year-over-year, with early success in underpenetrated categories, positive trends in our Women’s business, and continued strong growth in Sephora. However, lower clearance sales versus last year represented a more than 600 basis point drag on comparable sales. Importantly, we were able to deliver gross margin expansion, manage inventory down 13% and tightly control expenses in the quarter.”
“We continue to have high conviction in our strategy and believe that our key growth initiatives, including Sephora, home decor, gifting, impulse, and our upcoming partnership with Babies “R” Us, will contribute more meaningfully going forward. That said, we recognize we have more work to do in areas of our business. We are approaching our financial outlook for the year more conservatively given the first quarter underperformance and the ongoing uncertainty in the consumer environment,” Kingsbury continued.
First Quarter 2024 Results
Comparisons refer to the 13-week period ended May 4, 2024 versus the 13-week period ended April 29, 2023
| | • | | Net sales decreased 5.3% year-over-year, to $3.2 billion, with comparable sales down 4.4% |
| | • | | Gross margin as a percentage of net sales was 39.5%, an increase of 48 basis points. |
| | • | | Selling, general & administrative (SG&A) expenses decreased 0.8% year-over-year, to $1.2 billion. As a percentage of total revenue, SG&A expenses were 36.3%, an increase of 166 basis points year-over-year. |
| | • | | Operating income was $43 million compared to $98 million in the prior year. As a percentage of total revenue, operating income was 1.3%, a decrease of 148 basis points year-over-year. |
| | • | | Net loss was $27 million, or ($0.24) per diluted share. This compares to net income of $14 million, or $0.13 per diluted share in the prior year. |
| | • | | Inventory was $3.1 billion, a decrease of 13% year-over-year. |
| | • | | Operating cash flow was a use of $7 million as compared to a use of $202 million in the prior year. |
Updated 2024 Financial and Capital Allocation Outlook
For the full year 2024, which has 52 weeks compared to 53 weeks in full year 2023, the Company’s guidance includes the potential impact from credit card late fee regulatory changes in the second half of 2024. The Company currently expects the following:
| | • | | Net sales: A decrease of (2%) to a decrease of (4%) |
| | • | | Comparable sales: A decrease of (1%) to a decrease of (3%) |
| | • | | Operating margin: In the range of 3.0% to 3.5% |
| | • | | Diluted EPS: In the range of $1.25 to $1.85 |
| | • | | Capital Expenditures: Approximately $500 million, including expansion of Sephora partnership and other store-related investments |
| | • | | Dividend: On May 15, 2024, Kohl’s Board of Directors declared a quarterly cash dividend on the Company’s common stock of $0.50 per share. The dividend is payable June 26, 2024 to shareholders of record at the close of business on June 12, 2024. |
| | • | | Debt Reduction: Earlier this month we exercised our right to redeem the remaining $113 million of our 9.500% notes due May 15, 2025. The redemption will be completed on June 13, 2024. |
