Kohl’s 2Q Profit Nearly Flat, as Same-Store Sales Slip Again

(Milwaukee Journal Sentinel/MCT) -

Kohl’s Corp. beat analysts’ expectations in the second quarter, but same-store sales slipped again, the retailer reported Thursday.

Sales at stores open at least a year, a critical measure of retailing performance, were down 1.3 percent for the three months ended Aug. 2, compared with 2013.

Kohl’s same-store sales have fallen short of the previous year’s mark in five of the last six quarters.

Overall revenue was down, too – by 1.1 percent, to $4.24 billion.

Kevin Mansell, the chairman, president and CEO of the Wisconsin-based department-store chain with a presence in 49 states, said sales improved as the quarter progressed.

During a conference call, Mansell told analysts the company is continuing several initiatives aimed at boosting customer traffic in its stores.

The Kohl’s loyalty program, now in place in a third of the chain’s 1,160 stores, will expand to the rest in October.

Also growing is the number of stores with expanded cosmetic selections. Forty-seven locations got new cosmetic departments in July, with another 178 coming over the next two months, Mansell said. The re-worked cosmetic sections have been attracting additional 18- to 34-year-old customers, CFO Wes McDonald said.

As part of a renewed emphasis on national brands and a wider selection of active wear, Kohl’s will begin offering the Puma line in the spring in some stores, Mansell said. Also on tap within the next few months: Gaiam yoga products.

Mansell said about 800 Kohl’s stores will be equipped by early November to ship out orders originally placed online, essentially bringing warehouse capacity closer to millions of customers. The change will help Kohl’s fulfill year-end orders on time, a situation that posed “significant difficulties” for the company last year, Mansell said.

Kohl’s earned $232 million, or $1.13 a share, in the period, up from $231 million, or $1.04, in 2013. Analysts had expected earnings of $1.07 a share for the most recent quarter.