Kohl’s Corp. continued to show declines last quarter and doesn’t expect to reverse the trend this year.
Net income for the fourth quarter ended Feb. 1 was $48 million, or 43 cents a diluted share, and adjusted net income came to $106 million, or 95 cents. This compares to net income of $186 million, or $1.67, a year earlier.
Operating income was $126 million compared to $299 million a year earlier. As a percentage of total
revenue, operating income totaled 2.3 percent, a decrease of 270 basis points year-over-year.
Net sales in the fourth quarter fell 9.4 percent to $5.2 billion, with an extra week in the year-ago quarter making results look worse than they would have otherwise. Comparable sales, which adjust for calendar changes, decreased 6.7 percent.
Kohl’s also reported that it has decided to reduce its quarterly dividend to 12.5 cents a share, from 50 cents a share. The next dividend will be paid on April 2.
In January, the Menomonee Falls, Wisc.-based retailer laid out significant real estate changes for 2025, including the closure of its long-standing San Bernardino, Calif., e-commerce fulfillment center and 27 stores. Operating since 2010, the San Bernardino facility will shut down in May when the lease expires. According to the company, Kohl’s has expanded its capacity to fulfill customer orders from store locations and will no longer need the e-commerce fulfillment center.
Ashley Buchanan, Kohl’s chief executive officer, said in a statement: “Kohl’s is built on a strong foundation that includes operating more than 1,100 conveniently located stores nationwide, serving over 60 million customers, with 30 million of those customers being Kohl’s Loyalty Members. Kohl’s has a tremendous opportunity to build on our strengths, address key areas of opportunity and better serve our customers every day.
“We have identified key areas of focus and are taking action in 2025 to reposition Kohl’s for future success,” Buchanan added. “Our customers expect great product, great value and a great experience from Kohl’s. I am confident that the areas we identified will deliver on what customers want and expect from Kohl’s.”
Buchanan became Kohl’s CEO in January after serving as CEO of Michael’s. The last two CEOs of Kohl’s, Tom Kingsley and Michelle Gass were unsuccessful in their efforts to turnaround the business despite years of merchandise and store changes. Kohl’s has been losing market share to stronger competitors including Walmart, Amazon and TJMaxx.
Ashley Buchanan
Courtesy walmart.com
This year, the company is projecting a 5 percent to 7 percent sales decline, with a 4 percent to 6 percent comp sales decrease. Diluted earnings per share are seen ranging from 10 cents to 60 cents.
The rather dismal forecast dragged Kohl’s stock price down about 14 percent to $10.30 in pre-market trading Tuesday.
For all of 2024, net income was $109 million, or 98 cebts per diluted share, and adjusted net income totaled $167 million, or $1.50 per adjusted diluted share. This compares to net income of $317 million, or $2.85 per diluted share in the prior year.
Net sales decreased 7.2 percent year-over-year, to $15.4 billion. Fiscal 2023 included net sales of approximately $164 million from the 53rd week. Comp sales decreased 6.5 percent for the year.
