Kohl's sales beat allays concerns about U.S. retail slowdown
By Sruthi Ramakrishnan
(Reuters) - Department store operator Kohl's Corp KSS.N reported better-than-expected quarterly net sales and profit on Thursday due to strong back-to-school sales, a day after Macy's (M.N: Quote) full-year forecast cut raised concerns about the sector's performance.
Kohl's shares, which fell to a two-year low on Wednesday, rose as much as 9.5 percent to $47.24, boosting shares of other retailers such as J. C. Penney Co Inc (JCP.N: Quote) and Nordstrom Inc (JWN.N: Quote).
J. C. Penney reports on Friday, while Nordstrom reports after the bell on Thursday.
Macy's cited lower discretionary spending and a strong dollar that discouraged tourists from spending at its most profitable stores for its poor results.
Kohl's, unlike Macy's, is not dependent on tourist spending and has carved a niche by positioning itself as a pure mid-tier retailer.
Initiatives such as tailoring merchandise to suit the preferences of local customers and offering more on-trend products boosted sales in the quarter.
Kohl's said it is benefiting from improved marketing, investing more in its online business and from higher sales of women's apparel, especially in the plus-size category.
Shoppers delayed buying back-to-school items to August, from the traditional start in July, and this benefited Kohl's third quarter instead of the second, said Neil Saunders, chief executive officer of retail research firm Conlumino. Continued...