Kohl’s Corp. delivered better-than-expected earnings and sales for the first quarter as well as hiked its outlook for the fiscal year.
For the three months ended May 1, the Menomonee Falls, Wis.-based company posted an adjusted income of $165 million, or adjusted earnings of $1.05 per share, compared with the prior year’s loss of $495 million, or loss of $3.22 per share. Wall Street had forecasted earnings of 4 cents per share. Revenues improved nearly 70% to $3.89 billion, versus market watchers’ bets of $3.48 billion.
In a statement, CEO Michelle Gass said that management was “very pleased with our strong start to 2021.”
“Along with a favorable consumer spending backdrop, we continue to see our key strategic initiatives gain traction and resonate with customers,” she added. “We saw momentum build through the quarter, especially in our stores where we continue to elevate the experience.”
Over the past several months, the chain has seen growth in its home business, as well as the active and beauty categories. It is also preparing for the launch of its partnership with Sephora, which will roll out 850 permanent shop-in-shops spanning roughly 2,500 square feet inside Kohl’s stores by 2023.
What’s more, the department store — which recently introduced Cole Haan into its roster of footwear brands — is set to bring Lands’ End and Toms Shoes into its portfolio in the fall. Separately, it launched its own private-label athleisure brand, FLX (pronounced “flex”), as an increasing number of consumers turned to athletic and casual lifestyles amid the COVID-19 pandemic.
Kohl’s ended the quarter with $1.6 billion in cash and reduced its long-term debt by more than $500 million. For the full year, it anticipates that sales will increase in the mid- to high teens percentage range, compared with the previous expectation of a mid-teens percentage rate gain. Adjusted earnings per share is now projected in the range of $3.80 to $4.20, versus the prior $2.45 to $2.95.
“We are positioned to capitalize on growth opportunities during the balance of 2021,” added Gass, “and remain firmly on track to achieving our 2023 strategic goals.”