Kohl's Q4 Sales Down, Net Income Rises
Fourth quarter net sales at Kohl’s were down slightly with the retailer reporting declines in comparable store sales but gains in net income.
For the quarter ended February 3, net sales were down 1.1% to $5.7 billion. The quarter included net sales of approximately $164 million from its 14th week. Comparable sales for the quarter (measured over 13 weeks ending January 27) were down 4.3%. Net income was $186 million, or $1.67 per diluted share. This compares to net loss of $273 million, or ($2.49) per diluted share in the prior year.
Tom Kingsbury, Kohl’s chief executive officer, said 2023 represented an important year for Kohl’s.
“We enhanced our store experience, expanded our partnership with Sephora, and invested in underpenetrated categories,” he said. “We also simplified our value strategies and implemented new inventory management processes. The early success of our strategies is evident. Our store business had its best comparable sales performance since 2010, Sephora at Kohl’s continued to drive meaningful beauty sales growth, and we managed inventory down 10% at year end.”
For the full fiscal year, net sales decreased 3.4% to $16.6 billion. The fourth quarter included net sales of approximately $164 million from the 14th week. Comparable sales, which compare the 13-week period ending January 27, 2024 versus the 13-week period ended January 28, 2023, decreased 4.7%. Net income was $317 million, or $2.85 per diluted share. This compares to net loss of $19 million, or ($0.15) per diluted share in the prior year.
For the current fiscal year, Kohl’s forecasts net sales of between -1% and 1%, with comparable stores sales flat to up 2%.
“Looking ahead, we are incredibly focused on delivering comparable sales growth in 2024,” said Kingsbury. “Our strategic initiatives are positioned to build momentum and contribute more meaningfully, and we will partner with Babies “R” Us to meaningfully expand our presence in the baby gear category which represents a compelling white space opportunity for Kohl’s. Through our collective efforts Kohl’s is becoming more relevant to customers, which strengthens our conviction in our longer-term opportunity,” Kingsbury continued.”
Through a partnership with WHP Global, owner of the Babies ‘R Us Brand, Kohl’s will open Babies ‘R Us shops in August, with plans to have the shops in about 200 stores by the fall. Items on display will include baby gear, furniture, and activity products. Customers will also be able to shop an expanded assortment of baby products on Kohls.com and take advantage of the Babies ‘R Us at Kohl’s registry to easily build and share gift lists.
