MILWAUKEE — Kohl’s has a new brand in its stable.
During a heated annual meeting with shareholders, Kohl’s Corp. said it was rolling out a new private label, apt. 9, this fall in men’s, women’s and soft home.
The idea is to bring a sophisticated element that’s been missing in Kohl’s mix, said president Kevin Mansell. The new brand will compete with Claiborne, Banana Republic and Perry Ellis in business-casual looks, but at moderate Kohl’s prices, Mansell said. At the same time, the chain’s Sonoma label will be positioned as a casual, comfortable brand.
“It will allow us to dramatically broaden the overall offering,” he said.
Apt. 9 is being developed by Kohl’s in-house design team and will be sourced from a number of vendors, Mansell said.
In addition, Kohl’s will have its Daisy Fuentes brand in the entire chain in the fall, and will extend the brand to shoes and accessories. The company rolled out the women’s apparel line in 180 stores this spring and has seen sell-throughs that top the entire misses’ apparel segment, Mansell.
The apparel initiatives are part of an attempt to boost sagging sales in the women’s part of the store. Last year the firm was forced to take steep markdowns to clear unsold merchandise, dragging down the bottom line.
Kohl’s continues to seek a merchandising executive to oversee the private label development. The company expects private labels to account for $2.5 billion to $3 billion in sales this year, or about 25 percent of revenues, Mansell said.
Earlier this month, Kohl’s announced the appointment of three members of the merchandising team, David J. Campisi and Donald A. Brennan. Campisi, who joins Kohl’s after eight years at Fred Meyer, will manage women’s apparel and accessories. Brennan will be responsible for men’s and children’s lines. Brennan was previously executive vice president for merchandise planning and allocation. Jack Moore continues to oversee home merchandise and footwear.
Wednesday, in an interview after the meeting, chairman Larry Montgomery took issue with an analyst’s report perceived as critical of Campisi’s experience. He pointed to Campisi’s prior experience at May Department Stores Co., and said Campisi had broad experience in both women’s apparel and management.
Kohl’s executives came under fire from shareholders during the public question portion of the meeting. One shareholder criticized Montgomery’s $29 million windfall from the exercise of stock options last year, while at the same time, the company reported its worst financial performance in its history as a public company. And others complained about Kohl’s drooping stock price, which hit a 52-week low of $41.27 last week.
Montgomery explained that his options, which dated back 10 years, would have expired if not exercised last year, and noted that he received no bonus in 2003.
Montgomery said that, while Kohl’s shares had declined in recent years, the stock was a good investment. He pointed to Kohl’s stock price gain over the past 10 years, from a split-adjusted $5.94 a share to $44.30 at the end of the last fiscal year.
All questions up for a vote in the proxy were voted in line with the company’s recommendations. Two shareholder proposals calling for an independent director requirement for the board chairman position and a revised restricted share program to replace the company’s existing stock option program were defeated.
— Doris Hajewski