Kohl's ends 2Q on high note, readies JLo, Marc Anthony launch
Cecile Corral -- Furniture Today, August 11, 2011
Menomonee Falls, Wis. - Despite their recent breakup, Latino celebrity couple Jennifer Lopez and Marc Anthony are still poised to help further propel the exclusive brand business at Kohl's this fall when the two new branded collections are set to launch.
During Kohl's second-quarter earnings call this morning, Kevin Mansell, chairman, president and ceo, noted that the retailer is "extremely excited about the Jennifer Lopez and Marc Anthony brands."
Both are set to start rolling out in late August, with the official launches in all stores nationwide and online in mid-September, in line with Kohl's Anniversary sale.
"We believe that both brands will resonate strongly with our existing customers and drive new customers into our stores," he said.
Kohl's has high expectations for the brands, positioning them as "catalysts for September and October," Mansell continued. "And we would expect [them] to accelerate our already strong trend in exclusive brand penetration."
In the second quarter, private and exclusive brand penetration "continued to increase ... as they were approximately 53% of our sales for quarter, up 335 basis points," Mansell said.
More specifically, private brand s like Sonoma and Apt. 9 "performed very well"; exclusive brands, including Food Network and Simply Vera Vera Wang, "achieved very strong double-digit sales increases," Mansell noted.
Home, along with accessories, reported the strongest comps for both the second quarter and year to date for Kohl's. And home was driven by bedding, small electronics and food prep product sales.
Online sales were also a highlight, having leapt by 36% to %171 million in sales.
The 1,097-unit, 49-state mid-tier department store chain reported for its second quarter, ended July 30, a 30% diluted earnings per share increase to $1.09. Net income was $303 million, compared with $260 million, or 84 cents per diluted share, a year ago. Net sales were up 3.6% to $4.2 billion versus last year's $4.1 billion; and comparable store sales for the quarter increased 1.9%.
On a year-to-date basis, earnings per share increased 22% to $1.81. Net income was $514 million versus the prior year's $459 million. Sales increased 3.4% to $8.4 billion, and comparable store sales increased 1.6%.
The company said its second quarter and year-to-date results are preliminary "to the extent that they do not reflect the impact of any of the lease accounting corrections" the company made over the period.
Kohl's earnings guidance for the third quarter calls for expected: total sales increases between 4% and 6%; comparable store sales increase of 2% to 4%; and gross margin as a percent of sales down (10) basis points to up 10 basis points over last year.
As a result of its second-quarter performance and its third-quarter share repurchase estimate, Kohl's is increasing its fiscal 2011 guidance share to $4.45 to $4.60 per diluted share from $4.25 - $4.40.
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