Kohl's takes the Christmas crown
The retailer's strategy to steal traffic from struggling brick-and-mortar competitors bore fruit during the holiday season.
The retailer reported that its same store sales for November and December 2017 increased 6.9% over the same period last year.
In July, Kohl's CEO Kevin Mansell told CNBC that "department stores are not all equal," and that the company's brick-and-mortar stores are its greatest strength in stealing away share from closing or struggling brick-and-mortar retailers.
“We are very pleased with our Holiday period sales, which were consistently strong through November and December," said Mansell. "All lines of business and all regions reported positive comp sales. As expected, growth in digital demand accelerated significantly in the Holiday period from the year-to-date trend. In addition, we experienced positive sales in our stores driven by stronger traffic. I’d like to thank every Kohl’s assocte across the organization for their commitment to delivering an outstanding Holiday experience for our customers.”
Kohl’s has been rolling out bold programs, such as handling returns for Amazon.com, in an effort to increase traffic. It has also been shrinking hundreds of stores rather than closing them, bringing in new brands, and overhauling its own brands.
Based on stronger than expected holiday sales and expectations for fiscal January, the company now expects its fiscal 2017 diluted earnings per share to be $4.10 to $4.20 versus its previous guidance of $3.72 to $3.92. Excluding the company's previously disclosed fourth quarter tax settlement of $30 million, diluted earnings per share is expected to be $3.98 to $4.08, compared to its prior guidance of $3.60 to $3.80.
The retailer continues to expect its fiscal 2017 gross margin rate to be higher than the prior year and its SG&A, including the 53rd week, to increase at the high end of its prior guidance of 0.5% - 2.0%.
The company’s guidance does not include the impact of recent changes in federal tax legislation, which are expected to have a positive impact on the company’s effective tax rate and generate a favorable non-cash tax benefit related to the re-measurement of deferred tax balances in 2017.
Kohl's will release its fourth quarter and fiscal 2017 results on March 1.