Kohl’s Corp. is going more exclusive, more online and into smaller stores.
The Menomonee Falls, Wis.-based chain boosted third-quarter profits by 19.9 percent and upped its guidance for the year, noting that 51 percent of its sales for the quarter were from private and exclusive brands, that it’s on track to hit $1 billion in online sales this year and that most of its new stores this year and next would feature a smaller format.
Profits rose to $211 million, or 80 cents a share, from $176 million, or 57 cents, a year earlier. Earnings came in 1 cent ahead of Wall Street’s consensus projection. Sales for the three months ended Oct. 31 rose 3.7 percent to $4.38 billion from $4.22 billion, with comparable-store sales up 2.1 percent.
Rising commodity prices helped push Kohl’s apparel costs up 10 to 15 percent for fall, ratcheting average unit retail prices up 9.5 percent, although a more modest unit-per-transaction decline lead to an overall 5.2 percent rise in average transaction value.
“We weren’t happy with our sales performance in the third quarter in total, but we definitely like the improvement that came in September and October,” said Kevin Mansell, chairman, president and chief executive officer, on a conference call with analysts. “We’re pleased to have achieved our earnings goals as all areas of the company contributed to the success. We have strengthened our marketing for the fourth quarter, adding approximately $30 million to our spending and have the benefit of the biggest brand launches in our company’s history, which we believe will allow us to continue to improve our sales performance in the fourth quarter.”
In mid-September, the retailer introduced its Jennifer Lopez and Marc Anthony brands. The company also plans to have new offerings for the back-to-school and fall season next year. As recently as 2004, exclusives accounted for only 25 percent of the retailer’s sales.
Kohls.com has also been updated to feature what’s new, best sellers and items shoppers rate highly. The company’s putting more money into digital media marketing to reach more targeted audiences and opened its third e-commerce fulfillment center to support the peak holiday season.
But even with the company’s Web business approaching the 10-digit mark, Kohl’s is still largely a brick-and-mortar retailer, although its new stores are smaller, reflecting broader trends as retailers move to smaller boxes. About three quarters of the 40 stores Kohl’s opened this year feature its more-compact format with fewer than 64,000 square feet of retail space. And 90 percent of the 30 stores slated to open next year will be on the smaller side. As of this summer, Kohl’s stores had an average of about 74,000 square feet of selling space.
Kohl’s raised its profit outlook for the year to a range of $4.41 to $4.52 a share from $4.34 to $4.49. Analysts already had the company pegged for earnings of $4.44.
Shares of the firm closed up 2 percent to $55.36 on Thursday.
@tradesy is turning the concept of a showroom upside down with its new space in Santa Monica. Here, the company plans to hold events, art exhibits and a showcase rare fashion pieces like this Louis Vuitton boxing set. Get all the details on Tradesy’s first showroom on WWD.com. #wwdnews
Spotted last night at the @erdem x @hm launch event: Kate Bosworth, Rashida Jones, Kirsten Dunst and Selma Blair. The party, which took place in LA, also marked the opening of their pop-up shop. “I was interested in creating a collection that wasn’t in any way disposable. It was about pieces you’d create and keep forever, things that have a permanence to it,” designer Erdem Moralioglu said. #wwdeye (📷: Katie Jones)
Renee Zellweger in yellow in 2001 and again in 2017. Chosen as one of the 12 @pantone Leading Spring Colors (and dubbed “Meadowlark”), it only makes sense that the bright hue stands the test of time and is making a resurgence this season, seen already on stars like @blakelively and @gigihadid. (📷: Donato Sardello & @rexfeatures) #wwdfashion #tbt
Dior’s 70th anniversary celebration continues with a new exhibition at the Royal Ontario Museum in Toronto. “Christian Dior,” which is scheduled to run through March 18, takes a look at the founders tenure from 1947 to 1057 and feature 40 designs. Pictured here is an evening gown from the Ailée, fall 1948-49 haute couture collection. #wwdfashion (📷: Brian Boyle)
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews