Shares of Kohls (NYSE:KSS) ticked higher Thursday after the moderately priced department store operator said a 16% jump in second-quarter profit trumped Wall Street as margins improved on higher sales and tighter expenses.
Reflecting the strong growth, the retail chain operator raised its annual earnings view to a range of $4.45 to $4.60 a share from its earlier forecast between $4.25 and $4.40. Wall Street is looking for a slightly weaker profit of $4.40.
The Menomonee Falls, Wis.-based posted net income for the quarter of $303 million, or $1.10 a share, compared with $260 million, or 84 cents a share, in the same quarter last year. Analysts polled by Thomson Reuters were expecting a profit of just $1.08 a share.
Revenue for the three months ended July 30 was $4.25 billion, up 3.6% from $4.1 billion a year ago, just missing the Streets view of $4.28 billion. Fueling the gains was a 1.9% gain in stores open at least a year.
I am extremely pleased with our ability to deliver strong earnings growth in a challenging sales environment, Kohls CEO Kevin Mansell said in a statement. Prudent expense management across many of our areas, especially in stores, allowed us to achieve lower-than-planned expense growth.
The company attributed the results to stronger margins with the introduction of private and exclusive brands and disciplined inventory management.