Hurricanes bite into Kohl's Q3 profit, but same-store sales rise
Kohl's Corp.'s profit took a hit in the third quarter amid higher costs and the impact of three hurricanes.
Net income fell to $117 million, or 70 cents per share, in the quarter ended October 28, down from $146 million, or 83 cents a share, in the year-ago period. Analysts were expecting Kohl's to earn 72 cents per share, adjusted.
On the chain's quarterly call, CFO Bruce Besanko said that Kohl's was forced to close some 100 stores temporarily due to the hurricanes (notably Hurricane Harvey). Sales took a $15 million hit due to the hurricanes, which also raised Kohl's expenses by more than $8 million.
Sales for the quarter totaled $4.33 billion, up from $4.32 billion last year, and topping analysts' estimate of $4.30 billion. Same-store sales inched up 0.1%. Analysts had been expecting a decline.
"We are pleased to report an increase in comp sales for the quarter as the traffic momentum we saw in the first half of the year continued," said Kevin Mansell, CEO, Kohl's. "We saw strong results during the back-to-school season, achieving a low single-digit positive comp. The middle of the quarter was soft as we experienced disruptions from the hurricanes and other unseasonal weather. The quarter closed with strong sales in the second half of October."
The retailer raised its earnings outlook for fiscal 2017, Kohl's projected adjusted earnings to range from $3.60 and $3.80 a share versus a prior expected range of $3.50 to $3.80.
"Looking ahead to the all-important holiday season, we are encouraged by both the momentum Kohl's has built to date and by some of its plans to drive trade," commented Neil Saunders, managing director, GlobalData Retail. "That said, a significant element of those plans appears to be discount and deal focused. As much as this is a necessary evil, we believe that it could have a negative impact on an already weakening bottom line. This is something Kohl's will need to remedy if it is to reap the rewards of improved customer numbers."
Kohl's ended the quarter with 1,156 Kohl's stores, 12 Fila Outlets and four Off/Aisle clearance outlets.
Net income fell to $117 million, or 70 cents per share, in the quarter ended October 28, down from $146 million, or 83 cents a share, in the year-ago period. Analysts were expecting Kohl's to earn 72 cents per share, adjusted.
On the chain's quarterly call, CFO Bruce Besanko said that Kohl's was forced to close some 100 stores temporarily due to the hurricanes (notably Hurricane Harvey). Sales took a $15 million hit due to the hurricanes, which also raised Kohl's expenses by more than $8 million.
Sales for the quarter totaled $4.33 billion, up from $4.32 billion last year, and topping analysts' estimate of $4.30 billion. Same-store sales inched up 0.1%. Analysts had been expecting a decline.
"We are pleased to report an increase in comp sales for the quarter as the traffic momentum we saw in the first half of the year continued," said Kevin Mansell, CEO, Kohl's. "We saw strong results during the back-to-school season, achieving a low single-digit positive comp. The middle of the quarter was soft as we experienced disruptions from the hurricanes and other unseasonal weather. The quarter closed with strong sales in the second half of October."
The retailer raised its earnings outlook for fiscal 2017, Kohl's projected adjusted earnings to range from $3.60 and $3.80 a share versus a prior expected range of $3.50 to $3.80.
"Looking ahead to the all-important holiday season, we are encouraged by both the momentum Kohl's has built to date and by some of its plans to drive trade," commented Neil Saunders, managing director, GlobalData Retail. "That said, a significant element of those plans appears to be discount and deal focused. As much as this is a necessary evil, we believe that it could have a negative impact on an already weakening bottom line. This is something Kohl's will need to remedy if it is to reap the rewards of improved customer numbers."
Kohl's ended the quarter with 1,156 Kohl's stores, 12 Fila Outlets and four Off/Aisle clearance outlets.