Kohl's 2005 Annual Report Download - page 8

Fiscal Year 2005 2004(a) 2003(a) 2002(a) 2001(a) 2000(a)
Summary of Operations (In millions)
Net sales $13,402 $11,701 $10,282 $ 9,120 $ 7,489 $ 6,152
Gross margin 4,763 4,114 3,395 3,139 2,565 2,096
Selling, general & administrative expenses 2,964 2,584 2,158 1,884 1,583 1,328
Preopening expenses 44 49 47 41 33 36
Depreciation and amortization 339 288 239 193 159 128
Operating income 1,416 1,193 951 1,021 790 604
Interest expense, net 70 63 73 56 50 46
Income before income taxes 1,346 1,130 878 965 740 558
Net income 842 703 546 601 458 343
Diluted Earnings Per Share $2.43 $ 2.04 $ 1.59 $ 1.75 $ 1.35 $ 1.02 (b)
Financial Position Data (Dollars in millions)
Working capital $ 2,520 $ 2,187 $ 1,902 $ 1,776 $ 1,584 $ 1,199
Property and equipment, net 4,544 3,988 3,316 2,734 2,196 1,725
Total assets 9,153 7,979 6,691 6,311 4,927 3,853
Long-term debt 1,046 1,103 1,076 1,059 1,095 803
Shareholders’ equity 5,957 5,034 4,212 3,532 2,803 2,217
Returnon average shareholders’ equity 15.3% 15.2% 14.1% 19.0% 18.3% 17.6%
Other Data
Comparable store sales growth 3.4% 0.3% (1.6)% 5.3% 6.8% 9.0%
Net sales per selling square foot $ 252 $ 255 $ 268 $ 284 $ 283 $ 281
Stores open at year end 732 637 542 457 382 320
Total square feet of selling space (In thousands) 56,625 49,201 41,447 34,507 28,576 23,610
REPORT OF MANAGEMENT
The management of Kohl’sCorporation is responsible for the integrity and objectivity of the financial and operating information contained in this Annual Report,
including the consolidated financial statements covered by the Report of the Independent Registered Public Accounting Firm. These statements were prepared
in conformity with generally accepted accounting principles and include amounts that are based on the best estimates and judgments of management.
The consolidated financial statements and related notes have been audited by Ernst & Young LLP,independent registered public accounting firm, whose report
is based on audits conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States). As part of its audit, the
firm performed a review of the Company’ssystem of internal controls and conducted such tests and employed such procedures as considered necessary to
render its opinion on the consolidated financial statements. The Company’s consolidated financial statements including the Report of the Independent
Registered Public Accounting Firm are included in the Company’s Form 10-K for the year ended January 28, 2006.
The Audit Committee of the Boardof Directors is composed of three independent Directors. The Committee is responsible for assisting the Board in its oversight
of Kohl’s financial accounting and reporting practices. The Audit Committee is directly responsible for the compensation, appointment and oversight of the
Company’s independent registered public accounting firm. The Audit Committee meets periodically with the independent registered public accounting firm, as
well as with management, to review accounting, auditing, internal accounting control and financial reporting matters. The independent registered public
accounting firm has unrestricted access to the Audit Committee.
Larry Montgomery Wesley S. McDonald
Chairman and Chief Executive Officer Executive Vice President - Chief Financial Officer
(a) Results for the 2000-2004 fiscal years have been restated to reflect expensing of stock options.
(b) Adjusted for stock split.
Financial Summary
Every day across the country, Kohl’s
is putting time, effort and funding
toward health and educational
opportunities for children.
PARTNERING WITH OUR COMMUNITIES
This Kohl’s A Team worked
side by side with neighbors
to construct the first of five
new Chicago playgrounds
built to the latest Consumer
Products Safety Council
standards. The playgrounds
are part of the Kohl’s Cares
for Kids®Safety Network
program.
Kohl’s is a strong partner in our communities through programs
involving our company and our Associates. In 2005, we
donated morethan $22 million to support our communities
nationwide.
Kohl’s Cares for Kids®is not just a program. It’s a
promise of hope for a brighter,healthier futurefor kids in
our communities. Throughout the year,Kohl’ssells special
merchandise in our stores with 100% of the net profit
benefiting health and educational opportunities for children
nationwide. In 2005, we partnered with 75 children’s hospitals
in 41 states to fulfill the health element of our Kohl’s
Cares for Kids®mission.
Our annual Kohl’s Kids Who Care®scholarship program
is an opportunity for us to recognize and rewardyouth who
volunteer in their communities. In 2005, we honored more
than 1,000 young volunteers. Also in 2005, Kohl’s
Associates volunteered morethan 20,000 hours of service
through the Kohl’s A Team. Associates volunteer their
time and talent to support youth-serving organizations and
Kohl’ssupports their efforts with corporate grants. The
Kohl’sFundraising Cardprogram is a simple, effective way
for schools and other youth-serving nonprofit organizations
to raise money to purchase supplies and equipment. In 2005,
Kohl’ssupported morethan 3,000 nonprofit organizations.
In the fall of 2005, Kohl’s and our Associates rallied to
support the victims of Hurricane Katrina. Kohl’smatched
the contributions of Associates to the National Red Cross
dollar-for-dollar, for a combined contribution of more
than $500,000.
Kohl’s is also taking a leadership role in supporting a
healthy,active lifestyle for kids as the official department
storeof U.S. Youth Soccer. In 2005, the Kohl’s
American Cup soccer tournament visited 36 states
and welcomed over 40,000 youth participants.