Slide 1: Q3 2024 Results Presentation
F-aUAN. KOHLS m Q3 2024 Results Presentation
Slide 2: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement Regarding Forward-Looking Information This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The Company intends forward-looking terminology such as “believes,” “expects,” “may,” “will,” “should,” “anti
Slide 3: Our Strategic Priorities, 2024 Outlook, Q3 2024 Results
6 Our Strategic Priorities Tl 2024 Outlook 16 Q3 2024 Results
Slide 4: CEO statement on third quarter results
“Our third quarter results did not meet our expectations as sales remained soft in our apparel and footwear businesses. Although we had a strong collective performance across our key growth areas, including Sephora, home decor, gifting, and impulse, and also benefited from the opening of Babies “R”
Slide 5: Kohl's is building on a solid foundation
Kohl's is building on a solid foundation Convenient Nationwide Great Product from Top Brands Omni-Channel Reach 1,178 Stores eile 80% Largest department store carter's aS e ; 2 chain in America © of Americans live é within 15 milesofa > . A SEPHORA+ KOHLS Kohl's store aie ae Sg 9 at Fi 2 OY ‘ umping
Slide 6: Our Strategic Priorities
Our Strategic Priorities
Slide 7: Focused on four overarching priorities to drive improved sales and profitability
FOCUSED ON FOUR OVERARCHING PRIORITIES TO Drive Improved Sales and Profitability es Accelerate and Manage Inventory Enhance the Simplify Our Value and Expenses Strengthen the Customer Experience Strategies with Discipline Balance Sheet « Re-establishing stores as key * Increasing productivity * Incr
Slide 8: Sephora at Kohl's is a beauty share leader
Sephora at Kohl’s is a beauty share leader $2B+ Sales Goal by 2025 ~140 * Total Sephora at Kohl's sales increased approximately 15% in Q3, New Shops including comparable sales growth of 9% Opened in 2024 * Solid demand across offering, especially in our fragrance and hair care offerings driven in pa
Slide 9: Building early success in underpenetrated categories
Building early success in underpenetrated categories Underpenetrated categories represent a significant sales opportunity in the coming years Delivered incremental sales from our expanded assortments in home decor and pet, with seasonal and everyday decor up more than 50% Impulse sales in Q3 grew mo
Slide 10: Increasing relevancy of apparel & footwear offerings in 2024
Increasing relevancy of apparel & footwear offerings in 2024 Repositioning Juniors offering next to Sephora in stores to better capitalize Q3 on cross shopping opportunities in 2024 Q1 2024 with positive sales growth
Slide 11: 2024 Outlook
2024 Outlook
Slide 12: 2024 Outlook
2024 Outlook Net Sales (7%) to (8%) vs. 2023 Comp Sales (6%) to (7%) vs. 2023 Operating 3 3.0% to 3.2% Margin Diluted EPS = $1.20 to $1.50 Capital Allocation Outlook * Capex: Approximately $500 million * Dividend: $0.50 quarterly dividend payable December 24, 2024 wo ey ii SEPHORA +KOHES
Slide 13: 2024 Holiday
2024 Holiday ¢ Well-positioned to deliver the great experience and holiday value that customers expect from Kohl's in stores and digitally * Compelling holiday assortment with expanded selection across apparel (sweaters, fleece, dresses) and gifting (Sephora, toys, jewelry, cozy bedding) ¢ Key growt
Slide 14: Capital allocation priorities support balance sheet goals
Capital allocation priorities support balance sheet goals —> Invest in the Business Support growth-driving initiatives (Sephora, impulse, Babies “R” Us) with capex of ~$500M in 2024 —> Committed to Dividend Return ~$220M annually to shareholders through $2.00 dividend per share ($0.50 quarterly) —»
Slide 15: Strengthening the balance sheet by reducing long-term debt
Strengthening the balance sheet by reducing long-term debt Kohl’s has reduced long-term debt by more than $1 billion since 2017 $2.5 $19 $19 2017-2018 = 2019 2020S 2021: «= 2022S 2023 2024E @ Long-Term Debt at Year End Billions) $113M May 2025 notes retired in June 2024 $275M of notes retired in 202
Slide 16: Q3 2024 Results
Q3 2024 Results
Slide 17: Q3 2024 Summary
Q3 2024 Summary Key Takeaways Q3 2024 * Q3 results did not meet our expectations * Q3 net sales declined (8.8%) versus Q3 2023 and comparable sales declined (9.3%) as sales remained soft in our core apparel : * Gross margin increased 20 bps to last year driven by inventory management and lower freig
Slide 18: Q3 2024 Gross Margin & SG&A Expense Performance
Q3 2024 Gross Margin & SG&A Expense Performance SG&A Expense Deleveraged 125 basis points vs Q3 2023 Increased 20 bps vs Q3 2023 1,360M $1, $1,291M 38.9% ‘% Total revenue 34.8% Q3 2023 Q3 2024 Q3 2023 Q3 2024 Q3 2024 Gross Margin Takeaways Q3 2024 SG&A Takeaways * Inventory management and lower frei
Slide 19: Q3 Key Metrics
Q3 Key Metrics Consolidated Statement of Operations (Dollars in Millions) Three Months Ended November 2, 2024 October 28, 2023 Net Sales $ 3,507 $ 3,843 Total Revenue 3,0 4,054 Gross Margin Rate 39.1% 38.9% SG&A 1,291 1,360 Depreciation 184 188 Operating Income 98 157 Interest Expense 76 89 (Benefit
Slide 20: Appendix
Appendix
Slide 21: Healthy debt stack with opportunities to address near-term maturities
Healthy debt stack with opportunities to address near-term maturities $500M 4.625% D $353M 4.25% $ IN MILLIONS $427M 5.55% July 2025 2026 2027 2028 2029 2030 2031 2082 2033 2034 2035 2036 2087 21
Slide 22: Reconciliations
Reconciliations Key Cash Flow Items (Dollars in Millions) November 2, 2024 Three Months Ended November 2, 2024 Nine Months Ended Operating Cash Flow $ (igs) $ 52 Capital Expenditures (128) (367) Free Cash Flow (323) 15) Finance lease and financing obligation payments (20) (62) Proceeds from financin
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