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Late Season Surge Leaves Kohl’s In Holiday Sales Bind

Today, Kohl’s Corp. reported that, for the five-week month ended December 29, 2012, total sales increased 4%. Comparable store sales increased 3.4% versus the five-week month ended December 31, 2011.

For the November and December holiday sales period, the retailer noted, total sales increased 0.7%, and comparable store sales increased 0.1%.

Kevin Mansell, Kohl’s chairman, president and CEO, said in commenting on financial results, “December sales were lower than planned. Additionally, sales came late in the holiday shopping season and, as a result, were at deeper discounts than planned. We are taking the necessary markdowns in the fourth quarter to manage our inventory as we transition into the Spring season.”

Due to its performance so far in the fourth quarter, Kohl’s said it now expects diluted earnings per share for the period to come in at $1.60 to $1.62 for the fourth quarter versus its previous guidance of $2.00 to $2.08. A published Thomson Reuters fourth quarter average analyst earnings estimate was for $1.91.

E-commerce was a Kohl’s bright spot, with sales up 46% over the December, 2011 period, the company announced. The West was the strongest company sales region in the month with a low single-digit comp increase. The Midwest came in slightly positive, and all other regions reported low single-digit comp declines. Children’s has the strongest sales advance by product category, Kohl’s related. Home came in above the company average, the retailer stated in a conference call, with electrics and other housewares leading sales and bedding strong, although home décor remained “challenging.”

Kohl’s operates 1,146 stores in 49 states versus 1,127 stores at the same time last year.