- Kohl’s shares erased pre-market trading gains after its quarterly conference call revealed a calendar shift will negatively impact the second half of the year.
- The retailer beat earnings, revenue, and comp sales estimates for the first-quarter and increased earnings guidance.
- Watch Kohl’s trade in real-time here.
Kohl’s first-quarter results beat across the board and the retailer even raised its earnings-per-share guidance. However, comparable sale forecasts for the year remained low-flat to 2%, due to the company’s calendar shift.
The company said the calendar shift will benefit the first half of the year and negatively impact the second half, leading shares to wipe out their gains from pre-market trading. They are down about 7% Tuesday afternoon.
“Our first quarter comp benefited from the calendar shift due in part to the timing of the friends and family event leading into Mother’s Day,” CFO Bruce Besanko said. “The shift will also positively impact our second quarter comp but will be a headwind in the third and the fourth quarters.”
A longer winter this year weighed on traditional spring items but Kohl’s worked around the challenge by depending on more seasonally resistant categories like Home and Active Apparel and Footwear. The company also pushed for a more digital marketing strategy to deliver strong sales.
Digital data helped the company come up with better omni-channel strategies and predict how much in-store merchandising it might need for each store. Mobile access, combined with the recent Your Price and Smart Cart features drove sales growth. Your Price give customers the net price after promotions are applied and Smart Cart encourages customers to use Kohl’s Cash vouchers and pick up items in-store. Digital sales increased 19% over the quarter.
Bensanko noted that while comp sales increased, transactions remained mostly flat, meaning sales were driven by each customer spending more on each transaction.
Kohl’s is up more than 8.5% this year.
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