* First-quarter earnings 66 cents/share vs estimate 56 cents
* First-quarter sales fall 1 percent to $4.2 bln
* Shares up 4.7 percent
(Adds comments from conference call, analyst call, byline)
By Phil Wahba
May 16 Kohl's Corp said on Thursday it
expects sales to rebound in the current quarter after bad
weather in early spring hurt business at the department store
The retailer also reported a better-than-expected
first-quarter profit, helped by signs that it is finally beating
a problem that deviled it last year - not ordering the styles
and stock that shoppers wanted.
Kohl's shares were up 4.7 percent at $52.00 at midday.
Last year, the company often frustrated Wall Street by
ordering too much inventory, with much of it ending up being
heavily discounted, or ordering too little, hurting sales.
Despite a 1.9 percent drop in sales at stores open at least
a year in the first quarter, gross profit margin on merchandise
rose 0.5 percentage point to 36.4 percent of sales.
"This suggests that sales in the quarter were not so
promotion-driven and that they're getting a better handle on
their inventory planning," Edward Jones analyst Brian Yarbrough
In the last year, Kohl's has brought in many new merchants,
the people who decide what the department store will sell, and
new operations planners. Yarbrough said the changes are starting
to pay off.
(For a graphic comparing Kohl's and J.C. Penney, click on link.reuters.com/kap28t)
On a call with Wall Street investors, Chief Executive Kevin
Mansell said there was "a lot of pent-up demand" for spring
merchandise that would help sales now that weather is warming up
in the northern United States. Kohl's expects same-store sales
to increase as much as 2 percent in the current quarter, which
includes the start of the back-to-school season.
In the first quarter, comparable sales were down 8 percent
for seasonal merchandise like T-shirts, shorts and sandals,
On Wednesday, Macy's Inc Chief Financial Officer Karen
Hoguet also said warmer temperatures in May would likely help it
make up some lost business.
Kohl's posted net income of $147 million, or 66 cents per
share, for the fiscal first quarter that ended May 4, beating
analysts' average forecast by 10 cents, according to Thomson
Reuters I/B/E/S. A year earlier, the company earned $154
million, or 63 cents per share.
Sales fell 1 percent to $4.20 billion, slightly below the
average forecast of $4.26 billion.
E-commerce sales jumped 31 percent as Kohl's continued to
invest in technology and move toward being able to fill online
orders from its stores.
The company forecast earnings of $1.00 to $1.08 per share
for the second quarter on sales growth of 1 percent to 3
(Reporting by Phil Wahba in New York and Siddharth Cavale in
Bangalore; Editing by Sriraj Kalluvila and John Wallace)