Costs bring Kohl's down to Earth
Home & Textiles Today Staff -- Home Textiles Today, May 14, 2004
MENOMONEE FALLS, Wis. — Once one of America's highest-flying retailers, Kohl's Corp. was headed down to Earth during the first quarter, with profits and same-store sales barely budging from last year's levels as costs climbed.
During a conference call late yesterday to discuss results, Kohl’s executives said that although private label is growing, national brands continue to make up 70 to 75 percent of the assortment. The relatively new Laura Ashley Lifestyle and Gloria Vanderbilt home programs, introduced during the first quarter, are slated for “considerable growth” this fall, according to Kevin Mansell, president.
Earnings at the heartland mid-pricer edged up just 2.5 percent, to $113.8 million from $111 million last year. Putting that gain into perspective, until recently Kohl's routinely put up earnings increases well in excess of 30 percent. At the close of 2001, Kohl's proudly trumpeted a fifth consecutive year of earnings growth over 30 percent.
Putting earnings under pressure during the opening quarter were stalled-out same-store sales and rocketing costs, which more than any offset margin improvement.