follow us

High expenses lead to bad year at Kohl's

In what Larry Montgomery, chairman and CEO, admitted was a "disappointment," Kohl's Corporation experienced a rare down year in 2003. The Midwestern retailer's net income fell 8.1 percent last year, to $591.2 million; and its operating income slipped 1.3 percent, to $1.3 billion.

Increases in expenses dampened Kohl's 2003 performance. The company experienced a 40-basis point rise in its selling, general, and administrative expenses as a percentage of net sales, to 20.3 percent. On a dollar basis, SG&A reached $2.1 billion, or 15 percent more than during the 2002 fiscal year.

These figures clouded over a nearly 13 percent pickup in net sales, which totaled $10.3 billion for 2003. As Montgomery noted, last year marked the 12th consecutive year in which Kohl's set a sales record. Simultaneously, however, same-store sales for the year fell 1.6 percent.

For the fourth quarter, net income dropped 11.5 percent, to $246.8 million; and operating income fell by nearly 8 percent, to $482.2 million. Sales grew by almost 12 percent, to nearly $3.6 billion.

Regarding the year to come, Montgomery said, "We are looking ahead to 2004, making improvements where necessary and continuing to focus on profitably increasing our comparable-store sales and increasing market share."

Kohl's plans to open about 95 stores in fiscal 2004, split evenly between entries into new markets and fill-ins for existing markets. Forty-seven of these units are slated to open in the first quarter, and 48 are on the board for the third quarter.

Kohl's Corporation

Qtr. 1/31/04 (x000) 2003 2002 % chg
Sales $3,561,900 $3,184,500 11.9
Operating income 482,200 523,800 -7.9
Net income 246,800 279,000 -11.5
Earnings per share 0.72 0.81 -11.1
Average gross margin 30.9% 33.0%
SG&A percentage 17.4% 16.6%
12 months 2003 2002 % chg
Sales 10,282,100 9,120,300 12.7
Operating income 1,303,700 1,321,100 -1.3
Net income 591,200 643,400 -8.1
Earnings per share 1.72 1.87 -8.0
Average gross margin 33.0% 34.4%
SG&A percentage 20.3% 19.9%

Featured Video

  • Online Moves From Afterthought To Main Thought For Textiles Suppliers

    Camera Icon More Videos

Other Home Furnishings Sites

Casual Living
Gifts and Decorative Accessories
Home Accents Today
Kids Today
Furniture Today