Kohl’s Provides Key Updates on Strategic Growth Initiatives and Financial Plan at Investor Day

MENOMONEE FALLS, Wis.–(BUSINESS WIRE)–Kohl’s Corporation (NYSE: KSS) (“Kohl’s” or the “Company”) will host a virtual Investor Day today during which it will provide an update on the Company’s strategy to drive growth and become the retailer of choice for the active and casual lifestyle. Kohl’s will also announce an updated long-term financial framework.

“Kohl’s is undergoing a significant transformation of its business model and brand to become the retailer of choice for the active, casual lifestyle. We have fundamentally restructured our business to deliver sustainable and profitable growth, while delivering strong shareholder returns,” said Michelle Gass, Kohl’s Chief Executive Officer. “We have laid the groundwork for our winning strategy and have begun to implement key initiatives that will scale and accelerate our growth in the years to come. We delivered record EPS in 2021 and reached our operating margin target two years ahead of schedule, reflecting our progress in generating more profitable growth. The initiatives we’re announcing today, including plans to grow Sephora’s business to $2 billion, further position us for long-term value creation.

During the Investor Day, Kohl executives will detail near- and long-term strategic initiatives to accelerate profitable growth, including:

Differentiated position in retail

Kohl’s occupies a differentiated position in retail and is evolving into a focused lifestyle concept, centered on the active and casual lifestyle. Kohl’s is modernizing its brand and offerings to meet the unique needs of how people live today and for the future by:

  • Drive continued growth in the Active and Casual categories;

  • Reigniting Women’s through significant growth in Kohl’s apparel business, expansion of outdoor and swim categories, and amplification of Kohl’s inclusive offering;

  • Improve and modernize the experience for customers, continue to refresh stores and launch Innovation Zones, which will inspire cross-category product and brand curations with a focus on brands owned by diverse; and

  • Maintain loyalty leadership by increasing Kohl’s Card Rewards earnings to 7.5% daily and introducing a co-branded credit card in 2023.

Persuasive partnerships

Kohl’s has compelling partnerships that are unique in the industry. These partnerships build on Kohl’s innovative, bold and disruptive spirit and deliver differentiated experiences that draw customers to Kohl’s through:

  • Grow Sephora into a $2 billion business through expanded store deployment to 850 stores and continued innovation to drive growth and customer engagement;

  • Continue to acquire millions of new customers with Amazon Returns; and

  • Be a destination for iconic national brands and continue to enrich the portfolio in line with corporate strategy.

Extend Kohl’s omnichannel reach

Kohl’s has an extensive national store base and will build on its strong and growing base of 65 million customers by expanding its store portfolio, growing its digital business and increasing relevance to attract more customers through:

  • Opening more than 100 new, smaller-format Kohl’s stores over the next four years;

  • Drive digital business to $8 billion by improving discovery and purchaseability on Kohls.com;

  • Deployment of self-service online shopping, in-store collection in all stores in 2022 and continuation of self-service return and payment tests; and

  • Develop Kohl’s media network as a way to leverage the company’s strong omnichannel capability.

Leverage data science

Kohl’s is a data-centric company and is taking additional steps to increase its data science capabilities to help interact more effectively with customers and deliver greater relevance by:

  • Use data science to increase personalization and accelerate localization across its entire store base over the next two years; and

  • Optimize data and analytics to create more relevant customer experiences, drive higher revenue, higher margin, and greater asset efficiency.

Create value for shareholders

Kohl’s introduces a long-term financial framework focused on creating shareholder value by offering:

  • Low-single-digit percent sales growth;

  • 7% to 8% operating margin;

  • Mid to high single-digit EPS growth; and

  • Operating cash flow of over $5.5 billion and approximately $2.5 billion in free cash flow over the 2022-2024 period.

Capital allocation plans

Kohl’s remains committed to returning significant capital to shareholders while investing in initiatives to drive organic growth. As announced during its fourth quarter 2021 earnings call last week, the company increased its dividend by 100%, equating to an annual dividend of $2.00 per share and authorized a new share buyback program. shares of $3 billion. In 2022, the Company expects to repurchase at least $1.0 billion, demonstrating confidence in its business and key strategic initiatives.

Long-standing commitment to environment, social and governance (ESG)

Kohl’s reiterated its longstanding commitment to ESG management. Kohl’s is committed to creating sustainable solutions, giving back to the community, and building on diversity and inclusion efforts across the company. The company announced plans by 2025 to achieve net-zero emissions and reinforced its goal of tripling spending with various suppliers. More details on ESG goals and initiatives will be shared in the company’s ESG report released next month and will include TCFD and SASB reports.

Investor Day Details

Kohl’s Virtual Investor Day will begin at 9 a.m. Eastern Time on Monday, March 7. Members of the investment community and others interested in attending the event can access the webcast of the presentation and Q&A by visiting Investors.Kohls.com. A replay of the entire event will be archived and available after the broadcast on the same site.

Caution Regarding Forward-Looking Information

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include information regarding the board’s consideration of expressions of interest and the business strategies, plans and objectives of the society. The Company uses forward-looking terminology such as “believes”, “expects”, “may”, “will”, “should”, “anticipates”, “plans” or similar expressions to identify forward-looking statements. These statements are subject to certain risks and uncertainties, which could cause the Company’s actual results to differ materially from those anticipated by the forward-looking statements. You should understand that these forward-looking statements are not guarantees of action, performance or strategic results. These risks and uncertainties include, but are not limited to, the risks more fully described in Section 1A of the Company’s Annual Report on Form 10-K, which is expressly incorporated herein by reference, and other factors that may be periodically described in the documents filed by the company. with the SEC. Forward-looking statements speak as of the date originally made, and Kohl’s assumes no obligation to update them.

Important information for shareholders and where to find it

Kohl’s intends to file a proxy statement and a BLUE proxy card with the SEC in connection with the solicitation of proxies for Kohl’s 2022 annual meeting of shareholders (the “Proxy Circular” and this meeting the “2022 Annual Meeting”). Kohl’s, its directors and certain of its senior officers will participate in the solicitation of proxies from shareholders with respect to the 2022 annual meeting. Information regarding the names of directors and officers of Kohl’s and their respective interests in Kohl by securities held or otherwise are set forth in Kohl’s proxy statement for the 2021 annual meeting of shareholders, filed with the SEC on March 19, 2021 (the “2021 Proxy Statement”) and in the current report of Kohl on Form 8-K, filed with the SEC on April 14, 2021 (together with the 2021 Proxy Circular, the “2021 Filings”). To the extent such participants’ holdings in Kohl’s securities have changed from the amounts described in the 2021 filings or have not been included, such changes or amounts have been reflected on the initial beneficial ownership statements on the Form 3 or change of ownership statements on Form 4 filed with the SEC or will be filed within the time specified by Section 16 of the Securities Exchange Act of 1934, as amended, and the regulations thereunder. Additional information is available in Kohl’s quarterly reports on Form 10-Q for the first three quarters of the fiscal year ended January 29, 2022 filed with the SEC on June 3, 2021, September 2, 2021 and December 2, 2021, respectively. Details of Kohl’s board nominees for election at the 2022 annual meeting will be included in the proxy statement. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND KOHL SHAREHOLDERS ARE ADVISED TO READ ALL RELEVANT DOCUMENTS FILED WITH OR PROVIDED WITH THE SEC, INCLUDING KOHL’S DEFINITIVE PROXY STATEMENT, ANY SUPPLEMENTS THEREOF, AND THE CARD OF BLUE PROXY WHICH ACCOMPANIES IT, AS THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and shareholders will be able to obtain a copy of the definitive proxy statement and other documents filed by Kohl’s free of charge at the SEC’s website, www.sec.gov. Copies will also be available free of charge on Kohl’s website at investor.kohls.com.

About Kohls

Kohl’s (NYSE: KSS) is a leading omnichannel retailer. With over 1,100 stores in 49 states and the online convenience of Kohls.com and the Kohl’s app, Kohl’s offers amazing national and exclusive brands at incredible savings for families nationwide. Kohl’s is in a unique position to deliver on its strategy and vision to be the most trusted retailer of choice for the active, casual lifestyle. Kohl’s is committed to advancing its diversity and inclusion commitments, as well as the company’s environmental, social and corporate governance (ESG) management. For a list of store locations or to shop online, visit Kohls.com. For more information on Kohl’s impact in the community or how to join our winning team, visit Corporate.Kohls.com or follow @KohlsNews on Twitter.