Kohl's Corporation Reports Second Quarter Financial Results

  Kohl's Corporation Reports Second Quarter Financial Results  Business Wire  MENOMONEE FALLS, Wis. -- August 14, 2014  Kohl’s Corporation (NYSE:KSS). Kohl’s Corporation today reported results for the quarter endedAugust2, 2014.                                                           Quarter                           Year to Date ($ in       2014        2013       Change   2014        2013        Change millions) Sales        $ 4,242     $ 4,289    (1.1 )%   $ 8,312     $ 8,488     (2.1 )% Comparable store        (1.3    )%    0.9   %   -          (2.3  )%    (0.5  )%   - sales Net income   $ 232        $ 231       —    %    $ 357        $ 378        (6   )% Diluted earnings    $ 1.13     $ 1.04    9    %   $ 1.73     $ 1.70     2    % per share                                                                             Kevin Mansell, Kohl's chairman, president and chief executive officer, said, “We are pleased with the improvement we saw in sales as the quarter progressed. The improvement was the most dramatic in the month of July where we achieved a positive comp. As they consistently do, our teams did a great job of managing expenses throughout the quarter. We enter the back-to-school season with fresh, new inventory and encouraging momentum."  Dividend  OnAugust 12, 2014, Kohl's Board of Directors declared a quarterly cash dividend on the Company's common stock of$0.39per share. The dividend is payable September 24, 2014to shareholders of record at the close of business onSeptember 10, 2014.  Store Update  Kohl’s ended the quarter with 1,160 stores in 49 states, compared with 1,155 stores at the same time last year. The Company opened four new store locations, relocated one existing store and permanently closed two stores during the first quarter of 2014. It expects to open four new stores this Fall, including one store which was temporarily closed in the first quarter for a complete re-build.  Second Quarter 2014 Earnings Conference Call  Kohl's will host its quarterly earnings conference call at 8:30 am ET on August 14, 2014. The phone number for the conference call is (800) 230-1096. 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 333513. 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 causeKohl'sactual 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 inKohl'sfilings with theSEC.  About Kohl's  Kohl’s (NYSE: KSS) is a leading specialty department store with 1,160 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, onlineatKohls.comand via mobile devices.Committed to our communities, Kohl’s has raised more than$257 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, visitwww.Kohls.com/Cares.For a list of store locations and information, or for the added convenience of shopping online, visitwww.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)   KOHL'S CORPORATION CONSOLIDATED STATEMENTS OF INCOME (In Millions, except per share data) (Unaudited)                                                                                                   Three Months Ended      Six Months Ended                                  August 2,   August 3,   August 2,   August 3,                                  2014        2013        2014        2013 Net sales                        $ 4,242     $ 4,289     $ 8,312     $ 8,488 Cost of merchandise sold         2,588      2,613      5,162      5,284                                                                                  Gross margin                     1,654       1,676       3,150       3,204                                                                               Operating expenses: Selling, general, and            981         1,000       1,981       1,997 administrative Depreciation and amortization    222        225        438        439                                                                                    Operating income                 451         451         731         768                                                                               Interest expense, net            85         84         170        167                                                                                    Income before income taxes       366         367         561         601 Provision for income taxes       134        136        204        223                                                                                    Net income                       $ 232      $ 231      $ 357      $ 378                                                                                  Basic net income per share       $ 1.14      $ 1.05      $ 1.74      $ 1.71 Average number of shares         204         220         205         221                                                                               Diluted net income per share     $ 1.13      $ 1.04      $ 1.73      $ 1.70 Average number of shares         205         222         206         222                                                                               As a percent of net sales: Gross margin                     39.0    %   39.1    %   37.9    %   37.7    % Selling, general and             23.1    %   23.3    %   23.8    %   23.5    % administrative expenses Operating income                 10.6    %   10.5    %   8.8     %   9.0     % Net income                       5.5     %   5.4     %   4.3     %   4.5     %   KOHL'S CORPORATION CONSOLIDATED BALANCE SHEETS (In Millions) (Unaudited)                                                                                                                             August 2,   August 3,                                                          2014        2013 Assets Current assets: Cash and cash equivalents                                $  746      $  592 Merchandise inventories                                  3,899       3,856 Deferred income taxes                                    132         150 Other                                                    300         284                                                                       Total current assets                                     5,077       4,882                                                                       Property and equipment, net                              8,686       8,891 Other assets                                             338         324                                                                       Total assets                                             $  14,101   $  14,097                                                                       Liabilities and Shareholders' Equity Current liabilities: Accounts payable                                         $  1,479    $  1,396 Accrued liabilities                                      1,057       1,065 Income taxes payable                                     43          75 Current portion of capital lease and financing           105         147 obligations                                                                       Total current liabilities                                2,684       2,683                                                                       Long-term debt                                           2,792       2,492 Capital lease and financing obligations                  1,896       1,948 Deferred income taxes                                    358         381 Other long-term liabilities                              562         540 Shareholders' equity                                     5,809       6,053                                                                       Total liabilities and shareholders' equity               $  14,101   $  14,097   KOHL'S CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (In Millions) (Unaudited)                                                          Six Months Ended                                                          August 2,  August 3,                                                          2014        2013 Operating activities Net income                                               $  357      $  378 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization                            438         439 Share-based compensation                                 24          27 Excess tax benefits from share-based compensation        (2      )   (2      ) Deferred income taxes                                    (17     )   (12     ) Other non-cash revenues and expenses                     11          18 Changes in operating assets and liabilities: Merchandise inventories                                  (20     )   (103    ) Other current and long-term assets                       3           22 Accounts payable                                         114         89 Accrued and other long-term liabilities                  (103    )   (20     ) Income taxes                                             (75     )   (74     )                                                                               Net cash provided by operating activities                730        762                                                                                    Investing activities Acquisition of property and equipment                    (374    )   (284    ) Other                                                    6          14                                                                                     Net cash used in investing activities                    (368    )   (270    )                                                                               Financing activities Treasury stock purchases                                 (392    )   (266    ) Shares withheld for taxes on vested restricted shares    (16     )   (13     ) Dividends paid                                           (160    )   (153    ) Proceeds from financing obligations                      3           — Capital lease and financing obligation payments          (61     )   (52     ) Proceeds from stock option exercises                     37          46 Excess tax benefits from share-based compensation        2           2 Deferred financing costs                                 —          (1      )                                                                               Net cash used in financing activities                    (587    )  (437    )                                                                               Net increase (decrease) in cash and cash equivalents     (225    )   55 Cash and cash equivalents at beginning of period         971        537                                                                                    Cash and cash equivalents at end of period               $  746     $  592    Contact:  Kohl’s Corporation Investor Relations: Wes McDonald, Senior Executive Vice President and Chief Financial Officer (262) 703-1893 or Media: Bevin Bailis, SVP, PR and Communications (262) 703-1464  
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