Kohl's Q1 Results Beat View; TJX Adj. Profit Misses Estimates

(RTTNews) - Department store chain Kohl's Corp. (KSS) on Tuesday reported financial results for the first quarter that beat analysts' estimates.

Meanwhile, off-price retailer TJX Companies, Inc. (TJX) reported adjusted earnings for the first quarter that missed analysts' expectations, even as its revenues beat estimates. Both the companies raised their earnings outlook for the full year.

Kohl's reported a 14 percent increase in profit for the first quarter from last year, reflecting higher sales and improved margins that helped offset a loss on debt extinguishment.

Kohl's first-quarter net income rose to $75 million or $0.45 per share from $66 million or $0.39 per share in the same quarter last year.

Kohl's completed a cash tender offer for $500 million of debt in the latest quarter. In conjunction with the tender, the company reported a $42 million loss on extinguishment of debt.

Excluding the loss on extinguishment of debt, adjusted earnings were $0.64 per share, compared to $0.39 per share in the year-ago period. On average, analysts polled by Thomson Reuters expected earnings of $0.50 per share. Analysts' estimates typically exclude special items.

Total revenue grew 3.5 percent to $4.21 billion from $4.07 billion last year. Analysts expected revenue of $3.95 billion.

Comparable sales for the quarter rose 3.6 percent, compared to a decrease of 2.7 percent in the prior-year period.

Kohl's board of directors declared a quarterly cash dividend on the company's common stock of $0.61 per share. The dividend is payable June 27, 2018 to shareholders of record at the close of business on June 13, 2018.

For fiscal 2018, Kohl's now expects adjusted earnings of $5.05 to $5.50 per share, up from its prior range of $4.95 to $5.45 per share. Including the loss on extinguishment of debt, the company expects earnings per share of $4.86 to $5.31. The Street expects earnings of $5.27 per share.

Meanwhile, TJX Companies reported a 34 percent increase in profit for the first quarter from last year, reflecting higher sales and customer traffic.

Looking ahead, the company forecast second-quarter earnings below the Street estimates, but raised the high end of its adjusted earnings outlook range for fiscal 2019.

TJX's first-quarter net income rose to $716.38 million or $1.13 per share from $536.28 million or $0.82 per share in the prior-year quarter. The latest quarter's results include a benefit of $0.17 per share due to items related to the 2017 Tax Cuts and Jobs Act.

Adjusted earnings were $0.96 per share, compared to $0.82 per share in the year-ago period. The Street expected earnings of $1.02 per share.

Net sales increased 12 percent to $8.69 billion from $7.78 billion in the same quarter last year and beat analysts' consensus revenue estimate of $8.47 billion.

Consolidated comparable store sales rose 3 percent, compared to an increase of 1 percent in the same period last year. Customer traffic was once again the primary driver of comparable store sales increases at each of the company's four large divisions.

For the second quarter, TJX Companies forecast earnings in a range of $1.02 to $1.04 per share and adjusted earnings of $0.87 to $0.89 per share, based upon estimated comparable store sales growth of 1 percent to 2 percent. Analysts expect earnings of $1.10 per share.

For fiscal 2019, TJX Companies now forecasts earnings in a range of $4.75 to $4.83 per share and adjusted earnings in a range of $4.04 to $4.10 per share, based upon estimated consolidated comparable store sales growth of 1 percent to 2 percent.

Earlier, the company forecast reported earnings of $4.73 to $4.83 per share and adjusted earnings of $4.00 to $4.08 per share.

The Street expects earnings of $4.85 per share for the year.