Kohl's Q2 Performance Fueled By Store Brands

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August 16, 2011

Kohl’s second quarter revenue and earnings increases are bucking the slow economy as executives continue to focus on store brands expansion.

The company’s net income for the quarter was $303 million, up from $260 million for the second quarter last year, and net sales rose 3.6 percent to $4.2 billion with a same-store sales increase of nearly 2 percent.

“Our gross margin rate increased significantly over second quarter of last year as a result of our increased penetration of private and exclusive brands and disciplined inventory management,” said Kevin Mansell, Kohl's chairman, president and CEO. “I am extremely pleased with our ability to deliver strong earnings growth in a challenging sales environment.”

Private label has been a cornerstone of the department store’s strategy for many years with brands such as its Sonoma line. This fall, the retailer plans to launch two more exclusive lines.

"We are very excited about the introduction of our Jennifer Lopez and Marc Anthony brands, which will launch in all stores nationwide and online in mid-September with our anniversary sale,” said Mansell. “We believe that both brands will resonate strongly with our existing customers and drive new customers into our stores."

Of course, Lopez and Anthony announced their pending divorce after the Kohl’s collection was well underway. The once dynamic duo is going forward with the lines, his in men’s apparel and hers in apparel, footwear and home. Expectations were for the line to expand into luggage and accessories for the Jennifer Lopez collection.

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