Kohl’s reported third-quarter results that beat earnings and revenue expectations, and the retailer’s independent chairman, Peter Boneparth, discussed qualities the company is seeking in a new CEO after Michelle Gass’ announced departure.
Third-quarter net income at Koh’s was $97 million, or 82 cents per diluted share, versus $243 million, or $1.65 per diluted share, in the quarter a year earlier. Kohl’s beat a Yahoo Finance-published analyst consensus earnings estimate of 78 cents and a $4.06 billion total revenue estimate.
Net sales were $4.05 billion and total revenue was $4.28 billion versus $4.37 billion and $4.6 billion, respectively, in the year-previous quarter. Operating income was $200 million versus $387 million in the period a year before. Third quarter comparable sales decreased 6.9%, the company stated
Boneparth hosted the third-quarter earnings conference call about a week after Kohl’s announced that Gass planned to depart from the company and move to Levis Strauss & Co. He said Kohl’s has initiated an executive search and is seeking a new CEO with experience in brand building that understands the Kohl’s market position and has deep omnichannel expertise. Candidates also should be team builders and innovators while appreciating the collaborative approach to management Kohl’s takes, according to Boneparth.
In the conference call, Jill Timm, Kohl’s CFO said inflation and the company’s exposure to discretionary categories including apparel and home goods, had pressured third-quarter results. Kohl’s generally middle-income customers “purchased fewer items per trip and traded down to our value-oriented private brands” in the period, Time said.
Store sales outperformed digital, which Timm credited to having more Sephora in Kohl’s shops open and the company’s investment in labor. Digital sales slipped 8% versus the year-prior quarter but were up almost 20% versus the third quarter of 2019. Home underperformed the company sales average, she said.
In announcing the financial results, Bonaparte said, “The Kohl’s board is focused on supporting the management team during this CEO transition period, as well as the board’s search committee in its pursuit of finding the next CEO to lead Kohl’s. We look forward to partnering with interim CEO Tom Kingsbury and the entire leadership team to execute at the highest level this holiday season, while also capitalizing on opportunities to strengthen the business. Kohl’s is a great company with extremely bright prospects, and I am confident we will find the right candidate to successfully position Kohl’s to drive sales, grow earnings and create shareholder value.”