<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THIS SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended July 31, 1999
----------------------------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________________ to _____________________
Commission file number 1-11084
-------
KOHL'S CORPORATION
-----------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
WISCONSIN 39-1630919
------------------------------------- ------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
N56 W17000 Ridgewood Drive, Menomonee Falls, Wisconsin 53051
- ------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (414) 703-7000
--------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 Days.
Yes X No_____
---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: September 7, 1999 Common Stock,
-------------------------------
Par Value $.01 per Share, 162,947,401 shares Outstanding.
- --------------------------------------------------------
<PAGE>
KOHL'S CORPORATION
INDEX
PART I. FINANCIAL INFORMATION
Item 1 Financial Statements:
Condensed Consolidated Balance Sheets at
July 31, 1999, January 30, 1999 and August 1, 1998 3
Condensed Consolidated Statements of Income for the
Three Months and Six Months Ended July 31, 1999 and
August 1, 1998 4
Consolidated Statement of Changes in Shareholders' Equity
for the Six Months Ended July 31, 1999 5
Condensed Consolidated Statements of Cash Flows for the Six
Months Ended July 31, 1999 and August 1, 1998 6
Notes to Condensed Consolidated Financial Statements 7-8
Item 2 Management's Discussion and Analysis of Financial Condition
and Results of Operations 9-15
PART II. OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K 16
Signatures 17
-2-
<PAGE>
KOHL'S CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
July 31, January 30, August 1,
1999 1999 1998
-------------------------------------------------------
(Unaudited) (Audited) (Unaudited)
(In thousands)
Assets
------
Current assets:
<S> <C> <C> <C>
Cash and cash equivalents $2,960 $2,858 $2,534
Short-term investments 58,753 26,736 14,850
Accounts receivable trade, net 395,005 270,704 191,519
Merchandise inventories 753,964 617,362 634,805
Deferred income taxes 17,863 14,412 8,520
Other 9,327 7,366 4,572
--------- --------- ---------
Total current assets 1,237,872 939,438 856,800
Property and equipment, net 1,086,985 933,011 831,116
Other assets 33,969 25,027 18,569
Favorable lease rights 140,628 13,681 14,926
Goodwill 22,338 24,938 27,538
--------- --------- ---------
Total assets $2,521,792 $1,936,095 $1,748,949
========= ========= =========
Liabilities and Shareholders' Equity
------------------------------------
Current liabilities:
Accounts payable $286,844 $212,926 $239,827
Accrued liabilities 120,081 117,200 90,255
Income taxes payable 11,901 48,572 14,363
Current portion of long-term debt 11,578 1,533 1,877
--------- --------- ---------
Total current liabilities 430,404 380,231 346,322
Long-term debt 498,667 310,912 312,659
Deferred income taxes 58,036 53,787 48,102
Other long-term liabilities 30,638 28,386 26,441
Shareholders' equity
Common stock-$.01 par value, 800,000,000 shares
authorized, 162,882,522, 158,394,735, and 158,054,978
issued at July 31, 1999, January 30, 1999 and
August 1, 1998, respectively. 1,629 1,584 1,581
Paid-in capital 760,946 504,275 490,994
Retained earnings 741,472 656,920 522,850
--------- --------- ---------
Total shareholders' equity 1,504,047 1,162,779 1,015,425
--------- --------- ---------
Total liabilities and shareholders' equity $2,521,792 $1,936,095 $1,748,949
========= ========= =========
</TABLE>
See accompanying Notes to Condensed Consolidated Financial Statements
3
<PAGE>
KOHL'S CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
3 Months 3 Months 6 Months 6 Months
(13 Weeks) (13 Weeks) (26 Weeks) (26 Weeks)
Ended Ended Ended Ended
July 31, August 1, July 31, August 1,
1999 1998 1999 1998
--------------------------------------------------------
(In thousands except per share data)
<S> <C> <C> <C> <C>
Net sales $939,503 $758,747 $1,849,759 $1,503,318
Cost of merchandise sold 614,199 502,170 1,211,327 993,272
--------- --------- ----------- -----------
Gross margin 325,304 256,577 638,432 510,046
Operating expenses:
Selling, general, and administrative 218,870 182,771 434,902 363,124
Depreciation and amortization 19,745 15,660 38,322 30,644
Goodwill amortization 1,300 1,300 2,600 2,600
Preopening expenses 5,110 - 13,055 7,542
--------- --------- ----------- -----------
Operating income 80,279 56,846 149,553 106,136
Interest expense, net 6,488 5,201 11,620 10,260
--------- --------- ----------- -----------
Income before income taxes 73,791 51,645 137,933 95,876
Provision for income taxes 28,558 20,297 53,381 37,680
--------- --------- ----------- -----------
Net income $45,233 $31,348 $84,552 $58,196
========= ========= =========== ===========
Earnings per share:
Basic
Net income $0.28 $0.20 $0.52 $0.37
Average number of shares 162,823 158,022 161,630 157,944
Diluted
Net income $0.27 $0.19 $0.51 $0.36
Average number of shares 167,548 162,752 166,502 162,475
</TABLE>
See accompanying Notes to Condensed Consolidated Financial Statements
4
<PAGE>
KOHL'S CORPORATION
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
Common Stock
------------------ Paid-In Retained
Shares Amount Capital Earnings Total
------- ------ -------- ---------- ----------
(In thousands)
<S> <C> <C> <C> <C> <C>
Balance at January 30, 1999 158,395 $1,584 $504,275 $656,920 $1,162,779
Issuance of common shares 2,800 28 199,598 - 199,626
Exercise of stock options 1,688 17 14,708 - 14,725
Income tax benefit from stock options - - 42,365 - 42,365
Net income - - - 84,552 84,552
------- ----- ------- ------- ---------
Balance at July 31, 1999 162,883 $1,629 $760,946 $741,472 $1,504,047
======= ===== ======= ======= =========
</TABLE>
See accompanying Notes to Condensed Consolidated Financial Statements
5
<PAGE>
KOHL'S CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
6 Months 6 Months
(26 Weeks) (26 Weeks)
Ended Ended
July 31, 1999 August 1, 1998
----------------------------------------------
(In thousands)
Operating activities
<S> <C> <C>
Net income $84,552 $58,196
Adjustments to reconcile net income to net
cash provided by (used in) operating activities
Depreciation and amortization 41,051 33,344
Deferred income taxes 798 1,093
Other noncash charges 1,659 1,314
Changes in operating assets and liabilities:
Accounts receivable (124,301) 48,098
Merchandise inventories (136,602) (119,015)
Other current assets (1,961) 687
Accounts payable 73,918 89,148
Accrued and other long-term liabilities 5,648 (3,081)
Income taxes (36,671) (24,119)
---------------- -----------------
Net cash provided by (used in) operating activities (91,909) 85,665
Investing activities
Acquisition of property and equipment
and favorable lease rights, net (323,960) (110,390)
Proceeds from sale of assets 4,350 -
Purchase of short-term investments, net (32,017) (14,850)
Other (9,038) (6,824)
---------------- -----------------
Net cash used in investing activities (360,665) (132,064)
Financing activities
Net borrowings under credit facilities 1,300 2,000
Proceeds from debt offering, net 197,258 -
Net borrowings (repayments) of other long-term debt (758) 325
Payment of financing fees on debt (1,840) -
Net proceeds from issuance of common shares 256,716 2,447
---------------- -----------------
Net cash provided by financing activities 452,676 4,772
---------------- -----------------
Net increase (decrease) in cash and cash equivalents 102 (41,627)
Cash and cash equivalents at beginning of period 2,858 44,161
---------------- -----------------
Cash and cash equivalents at end of period $2,960 $2,534
================ =================
</TABLE>
See accompanying Notes to Condensed Consolidated Financial Statements
6
<PAGE>
KOHL'S CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
The accompanying financial statements have been prepared in accordance with
generally accepted accounting principles for interim financial information.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for fiscal year end financial
statements. In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. For further information, refer to the financial statements and
footnotes thereto included in the Company's Form 10-K (Commission File No.
1-11084) filed with the Securities and Exchange Commission.
Shareholders' equity, share and per share amounts for all periods
presented have been adjusted for the 2 for 1 stock split declared by the
Company's Board of Directors on March 9, 1998, effected in the form of a stock
dividend.
Certain reclassifications have been made to prior years' financial
statements to conform to the fiscal 1999 presentation.
2. Merchandise Inventories
The Company uses the last-in, first out (LIFO) method of accounting for
merchandise inventory because it results in a better matching of cost and
revenues. The following information is provided to show the effects of the LIFO
provision on the quarter, as well as to provide users with information to
compare to other companies not on LIFO.
LIFO Expense 6 Months Ended
------------
Quarter July 31, 1999 August 1, 1998
------- ------------- --------------
(In Thousands)
First $1,363 $1,861
Second 1,409 1,896
----- -----
Total $2,772 $3,757
Inventories would have been $4,694,000, $1,921,000 and $8,540,000 higher
at July 31, 1999, January 30, 1999 and August 1, 1998, respectively if they had
been valued using the first-in, first-out (FIFO) method.
-7-
<PAGE>
3. Contingencies
The Company is involved in various legal matters arising in the normal
course of business. In the opinion of management, the outcome of such
proceedings and litigation will not have a material adverse impact on the
Company's financial position or results of operations.
4. Net Income Per Share
The numerator for the calculation of basic and diluted net income per
share is net income. The denominator is summarized as follows (in thousands):
6 Months Ended
July 31, 1999 August 1, 1998
--------------------------------
Denominator for
basic earnings
per share -
weighted average
shares 161,630 157,944
Employee stock
options 4,872 4,531
------- -------
Denominator for
diluted earnings
per share 166,502 162,475
======= =======
-8-
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
---------------------------------------
FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
----------------------------------------------
THREE MONTHS AND SIX MONTHS ENDED July 31, 1999
-----------------------------------------------
Results of Operations
- ---------------------
At July 31, 1999, the Company operated 231 stores compared with 197 stores
at the same time last year. During the quarter, the Company successfully opened
five stores in the Denver, CO market. The Company opened nine stores on August
20th: six in the St. Louis, MO market, a store in Hickory, NC and additional
stores in the Richmond, VA and Washington, D.C. markets. In October, Kohl's
plans to open 17 stores: 11 in Dallas/Ft. Worth, TX market and additional stores
in the Harrisburg, PA; Chicago, IL; Lansing, MI; Minneapolis, MN; Grand Rapids,
MI and the Denver, CO markets. In November, the Company plans to open two
additional stores in the Dallas/Ft. Worth, TX market. To support the expansion
in the St. Louis, Denver and Dallas/Ft. Worth markets, the Company will open a
distribution center in Blue Springs, MO in December, 1999.
The Company plans to open 55-60 new stores in the year 2000. Approximately
38 are planned to open in the first half of the year: 33 stores in New York, New
Jersey, Connecticut and Maryland previously operated by Caldor and additional
stores in the Dallas/Ft. Worth, TX, St. Louis, MO and Rochester, MN markets.
Net sales increased $180.8 million or 23.8% to $939.5 million for the three
months ended July 31, 1999 from $758.7 million for the three months ended August
1, 1998. Of the increase, $114.0 million is attributable to the inclusion of 17
new stores opened in 1998 and 18 new stores opened in 1999. The remaining $66.8
million is attributable to comparable store sales growth of 8.8%.
Net sales increased $346.5 million or 23.0% to $1,849.8 million for the six
months ended July 31, 1999 from $1,503.3 million for the six months ended August
1, 1998. Of the increase, $207.9 million is attributable to the inclusion of 32
new stores opened in 1998 and 18 new stores opened in 1999. The remaining $138.6
million is attributable to comparable stores sales growth of 9.7%.
Gross margin for the three months ended July 31, 1999 was 34.6% compared to
33.8% for the three months ended August 1, 1998. Gross margin for the six months
ended July 31, 1999 was 34.5% compared to 33.9% for the six months ended August
1, 1998. These increases are primarily attributable to a change in merchandise
mix and improvements related to inventory management.
-9-
<PAGE>
Effective January 30, 1999, the Company implemented SOP 98-5, "Reporting on
the Costs of Start-up Activities", which requires preopening costs to be
expensed as incurred. For new stores opened in March, April, and May, 1999,
approximately $1 million in preopening costs was expensed in fiscal 1998 and
$8.2 million was expensed during the six months ended July 31, 1999 for a
total average cost per store of $0.5 million. In addition, the Company incurred
$4.9 million in preopening costs for stores to be opened later in fiscal 1999.
The expenses relate to the cost associated with new store openings, including
advertising, hiring and training costs for new employees, and processing and
transporting initial merchandise.
Operating income for the three months ended July 31, 1999, increased $23.4
million or 41.2% over the three months ended August 1, 1998. Operating income
for the six months ended July 31, 1999 increased $43.4 million or 40.9% over the
six months ended August 1, 1998. Excluding pre-opening expenses, operating
income increased 43.0% for the six months ended July 31, 1999. These increases
resulted from the increased sales, improved gross margin and the Company's
ability to leverage its selling, general and administrative expenses as net
sales increased. Selling, general and administrative expenses declined to 23.3%
of net sales for the three months ended July 31, 1999 from 24.1% of net sales
for the three months ended August 1, 1998. Selling, general and administrative
expenses declined to 23.5% of net sales for the six months ended July 31, 1999
from 24.2% of the net sales for the six months ended August 1, 1998.
Net interest expense for the three months ended July 31, 1999 increased $1.3
million from the three months ended August 1, 1998. Net interest expense for the
six months ended July 31, 1999 increased $1.4 million from the six months ended
August 1, 1998. The increase was primarily attributed to the $200 million 7.25%
unsecured debentures issued in June 1999.
For the three months ended July 31, 1999 net income increased 44.3% to
$45.2 million from $31.3 million in the three months ended August 1, 1998.
Earnings were $.27 per diluted share for the three months ended July 31, 1999
compared to $.19 per diluted share for the three months ended August 1, 1998.
Net income for the six months ended July 31, 1999 increased 45.3% to $84.6
million or $.51 per diluted share from $58.2 million or $.36 per diluted share
in the six months ended August 1, 1998.
-10-
<PAGE>
Seasonality & Inflation
- -----------------------
The Company's business, like that of most retailers, is subject to seasonal
influences, with the major portion of sales and income realized during the last
half of each fiscal year, which includes the back-to-school and holiday seasons.
Approximately 17% and 30% of sales occur during the back-to-school and holiday
seasons, respectively. Because of the seasonality of the Company's business,
results for any quarter are not necessarily indicative of the rsults that may be
achieved for a full fiscal year. In addition, quarterly results of operations
depend significantly upon the timing and amount of revenues and costs associated
with the opening of new stores.
The Company does not believe that inflation has had a material effect on the
results during the periods presented. However, there can be no assurance that
the Company's business will not be affected in the future.
Impact of Year 2000
- -------------------
The Company currently has a Year 2000 Readiness Plan implemented. Detailed
in the plan are compliance definitions and testing guidelines for in-house
developed applications and computer hardware platforms. The plan defines a
methodology for assessing in-house developed applications and provides a means
for documentation. Team members and their responsibilities are defined including
senior executives that participate on the Year 2000 steering committee. The plan
includes three phases to address the Year 2000 issue and a status of these key
milestones is summarized below:
Year 2000 Readiness Plan Phases Current Status
- ------------------------------- --------------
Assessment Complete
Remediation Complete
Verification
. Replacement code systems Complete
. Packaged financial systems October 1999 target completion date
. Non-IS system (including September 1999 target completion date
merchandise vendor EDI
transactions)
The phases of the Year 2000 Readiness Plan are defined below:
. The Assessment phase involved the inventory of all in-house developed
applications, purchased software and hardware, merchandise vendors, non-IT
systems, utilities and service providers. The Assessment phase also included
developing a plan for addressing each item and/or vendor to ensure Year 2000
compliance. This phase is complete.
-11-
<PAGE>
. The Remediation phase involved implementing the changes required to reach
compliance and unit testing. This included correspondence with vendors that
have products or services that impact the Company's ability to continue
normal business operations. This phase is also complete.
. The Verification phase is system testing the changes in similar environments.
This includes testing with vendors and service provider organizations. The
Company has installed a Year 2000 test lab that is identical to the
production environment so that Year 2000 date simulation testing can be
performed without affecting production files. The Verification testing phase,
except for all packaged financial systems and non-IS systems, is complete.
The rollout of the packaged financial systems is approximately 75% complete
and will be finished by the end of October 1999. Even though the packaged
financial systems are identified Year 2000 compliant, the Company will be
conducting integrated testing in October 1999.
The Company has initiated formal communications with all significant
suppliers to determine the extent to which the Company's interface systems are
vulnerable to those parties' failure to remediate their own Year 2000 issues.
The Company is currently unit testing merchandise vendor EDI transactions and
non-IS systems and is over 90% complete. The Company continues to refine its
contingency plans and is enhancing and adding to the plans for each business
area. The Company has identified that it may experience certain inconveniences
or inefficiencies as a result of a supplier's failure to remediate its Year 2000
issues. The Company believes however, the vast majority of the Company's
business will proceed without any significant interruption.
The Company's total Year 2000 project costs and estimates to complete
include the impact of third party Year 2000 issues based on presently available
information. However, there can be no guarantee that the systems of other
companies on which the Company's systems rely will be timely converted and would
not have an adverse effect on the Company's systems.
The total cost of the Year 2000 project is estimated at $9 million and
is being funded through operating cash flows. Of the total project cost,
approximately $5 million is attributable to the purchase of new software and
hardware that will be capitalized. The remaining $4 million of programming and
testing costs will be expensed as incurred and is not expected to have a
material effect on the results of the operations. Of the capitalized portion,
approximately $4 million is for a new financial system. The new financial system
was a previously planned project that supports the Company's growth, provides
significant business enablement and
-12-
<PAGE>
eliminates a substantial Year 2000 effort. To date, the Company has incurred
approximately $7.1 million ($2.6 million expensed and $4.5 million capitalized)
related to the assessment of, and preliminary efforts on, its Year 2000 project
and the development of a modification plan, purchase of new systems and systems
modifications.
The cost of the project and the date on which the Company believes it will
complete the Year 2000 modifications are based on management's best estimates.
However, there can be no guarantee that these estimates will be achieved and
actual results could differ materially from those anticipated. In addition to
the Company's reliance on certain third parties to remediate their own Year 2000
issues, specific factors that might cause such material differences include, but
are not limited to, the continued availability and cost of personnel trained in
this area and the ability to locate and correct all relevant computer codes.
Financial Condition and Liquidity
- ---------------------------------
The Company's primary ongoing cash requirements are for inventory
purchases, capital expenditures in connection with the Company's expansion and
remodeling programs and pre-opening expenses. The Company's primary sources of
funds for its business activities are cash flow from operations, sales of its
proprietary accounts receivable, borrowings under its revolving credit facility
and short-term trade credit. Short-term trade credit, in the form of extended
payment terms for inventory purchases or third party factor financing,
represents a significant source of financing for merchandise inventories. The
Company's working capital and inventory levels typically build throughout the
fall, peaking during the holiday selling season.
At July 31, 1999, the Company's merchandise inventories had increased
$136.6 million over the January 30, 1999 balance and $119.2 million over the
August 1, 1998 balance. These increases reflect the purchase of fall inventory
as well as inventory for new stores. The Company's working capital increased to
$807.5 million at July 31, 1999 from $559.2 million at January 30, 1999 and
increased from $510.5 million at August 1, 1998. Of the $297.0 million increase
from August 1, 1998, $203.5 million is attributable to higher credit card
receivables as the Company sold a lower percentage of receivables. The remaining
increase was primarily the result of higher merchandise inventory levels
required to support existing stores and incremental new stores locations offset
in part by increased accounts payable.
-13-
<PAGE>
Cash used in operating activities was $91.9 million for the six months ended
July 31, 1999 compared to cash provided by operating activities of $85.7 million
for the six months ended August 1, 1998. Excluding changes in operating
assets and liabilities, cash provided by operating activities was $128.1 million
for the six months ended July 31, 1999 compared to $93.9 million for the six
months ended August 1, 1998.
In March 1999, the Company purchased the right to occupy 33 store locations
previously operated by Caldor Corporation for $142 million. The Company expects
these stores will be open for business in spring 2000. The Company expects to
invest approximately $165 million more to renovate and refixture the stores. To
fund the renovation and refixturing, the Company issued 2,800,000 shares of its
common stock to the public in March 1999 for net proceeds of approximately $200
million.
Capital expenditures, including the acquisition of the rights to occupy the
Caldor stores, for the six months ended July 31, 1999 were $324.0 million
compared to $110.4 million for the same period a year ago. The increase in
expenditures in 1999 is primarily attributable to the acquisition of the rights
to occupy the Caldor stores, the Company's new stores spending in the fiscal
1999 and the construction of a fourth distribution center.
Total capital expenditures for fiscal 1999 are currently expected to range
between $575-$600 million. This estimate includes the purchase of favorable
lease rights from Caldor Corporation and renovation and refixturing of the
properties. The actual amount of the Company's future annual capital
expenditures will depend primarily on the number of new stores opened, whether
such stores are owned or leased by the Company and the number of existing stores
remodeled or refurbished.
In June 1999, the Company issued $200 million redeemable 7.25% unsecured
debentures. The debentures mature on June 1, 2029. The proceeds will be used for
general corporate purposes and continued store growth.
The Company anticipates that it will be able to satisfy its current
operating needs, planned capital expenditures and debt service requirements with
current working capital, cash flows from operations, seasonal borrowings under
its $300 million revolving credit facility, short-term trade credit and other
sources of financing.
-14-
<PAGE>
Information in this document contains "foward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995, such as
statements relating to debt service requirements and planned capital
expenditures. Foward-looking statements can be identified by the use of foward-
looking terminology such as "believes", "expects", "may", "will", "should" or
"anticipates" or the negative thereof or other variations theron. No assurance
can be given that the future results covered by the foward-looking statements
will be achieved.
-15-
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits
3.1 Articles of Incorporation, as amended
4.1 First Supplemental Indenture dated as of
June 1, 1999 to Indenture dated as of
December 1, 1995, between Kohl's Corporation
and the Bank of New York, a trustee, incorporated
herein by reference to Exhibit 4.2 of the Company's
Registration Statement on Form S-4 (Reg. No. 333-83031)
12.1 Statement regarding calculation of ratio
of earnings to fixed charges.
27.1 Financial Data Schedule - Article 5 of Regulation S-X,
six months ended July 31, 1999
27.2 Financial Data Schedule - Article 5 of Regulation S-X, six
months ended August 1, 1998 (restated)
b) Reports on Form 8-K
There were no reports on Form 8-K filed for three months ended
July 31, 1999
-16-
<PAGE>
SIGNATURES
----------
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed in its behalf by the
undersigned thereunto duly authorized.
Kohl's Corporation
(Registrant)
Date: September 14, 1999 /s/ R. Lawrence Montgomery
-----------------------------
R. Lawrence Montgomery
Vice Chairman--
Chief Executive Officer
Date: September 14, 1999 /s/ Arlene Meier
-----------------------------
Arlene Meier
Executive Vice President - Finance
Chief Financial Officer
-17-
<PAGE>
EXHIBIT 3.1
AMENDMENT TO ARTICLES OF INCORPORATION
--------------------------------------
OF
--
KOHL'S CORPORATION
------------------
At a meeting of the Board of Directors of Kohl's Corporation on March 8,
1999 the following resolution was proposed, and at a meeting of the
shareholders of Kohl's Corporation on May 25, 1999, the following resolution was
duly adopted in accordance with Section 180.1003 of the Wisconsin Statutes:
BE IT RESOLVED, that Article III of the Articles of Incorporation of
Kohl's Corporation be amended by changing the number of authorized shares
of stock to read as follows:
<TABLE>
<CAPTION>
Designation Par Value Authorized
Class Per Share Number of Shares
--------- ----------- ------------------
<S> <C> <C>
Common Shares $.01 800,000,000
Preferred Shares $.01 10,000,000
</TABLE>
and except as set forth above, Article III shall remain in full force and
effect without further amendment or modification.
Executed in duplicate this 25th of May, 1999.
KOHL'S CORPORATION
By: /s/ R. Lawrence Montgomery
--------------------------
R. Lawrence Montgomery,
Chief Executive Officer
This instrument was drafted by:
Larry D. Lieberman
Godfrey & Kahn, S.C.
780 North Water Street
Milwaukee, Wisconsin 53202
<PAGE>
AMENDMENT TO ARTICLES OF INCORPORATION
--------------------------------------
OF
--
KOHL'S CORPORATION
------------------
Pursuant to the consent of the Board of Directors of Kohl's Corporation on
April 18, 1996 and the vote of shareholders of Kohl's Corporation on May 29,
1996, and in accordance with Section 180.1003 of the Wisconsin Statutes, the
following resolution was duly adopted:
BE IT RESOLVED, that Article III of the Articles of Incorporation of
Kohl's Corporation be amended by changing the number of authorized shares
of stock to read as follows:
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
Designation Class Par Value Per Share Authorized Number of Shares
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
Common Shares $ .01 400,000,000
- ------------------------------------------------------------------------------------------------
Preferred Shares $ .01 10,000,000
- ------------------------------------------------------------------------------------------------
</TABLE>
and except as set forth above, Article III shall remain in full force and effect
without further amendment or modification.
Executed in duplicate this 20th day of June, 1996.
KOHL'S CORPORATION
By: /s/ John F. Herma
--------------------
John F. Herma, Chief Operating Officer
and Secretary
This instrument was drafted by:
Larry D. Lieberman
Godfrey & Kahn, S.C.
780 North Water Street
Milwaukee, Wisconsin 53202
2
<PAGE>
ARTICLES OF MERGER OF
---------------------
KOHL'S CORPORATION
------------------
WITH AND INTO
-------------
KOHL'S WISCONSIN CORPORATION
----------------------------
Kohl's Wisconsin corporation, a corporation organized under the laws of the
State of Wisconsin, hereby certifies pursuant to Section 180.1107 of the
Wisconsin Statutes, as follows:
1. The Agreement and Plan of Merger by and between Kohl's Wisconsin
Corporation and Kohl's Corporation, a Delaware corporation, is attached hereto
as Appendix A and made a part hereof.
2. Said Plan of Merger was adopted and approved by the Board of Directors
and sole shareholder of Kohl's Wisconsin Corporation on March 23, 1993, in
accordance with Sections 180.1101 and 180.1103 of the Wisconsin Statutes.
3. All provisions of the laws of the States of Wisconsin and Delaware
applicable to the proposed merger have been complied with.
IN WITNESS WHEREOF, Kohl's Wisconsin Corporation has caused these Articles
of Merger to be executed on this 3rd day of June, 1993.
KOHL'S WISCONSIN CORPORATION
By: /s/ William S. Kellogg
------------------------
William S. Kellogg,
Chairman of the Board and
Chief Executive Officer
This instrument was drafted by:
Larry D. Lieberman
Godfrey & Kahn, S.C.
780 North Water Street
Milwaukee, Wisconsin 53202
3
<PAGE>
APPENDIX A
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, made and entered into as of this 23rd day of
March, 1993, by and between Kohl's Wisconsin Corporation, a Wisconsin
corporation (the "Surviving Corporation"), and Kohl's Corporation, a Delaware
corporation (the "Merging Corporation"). The Merging Corporation and the
Surviving Corporation are sometimes collectively referred to herein as the
"Constituent Corporations."
RECITALS
The Merging Corporation is a Delaware corporation having authorized capital
consisting of 60,000,000 shares of Common Stock, $.01 par value, of which
36,608,148 shares are issued and outstanding as of the date hereof, and
3,000,000 shares of Preferred Stock, $.01 par value, of which no shares are
issued and outstanding as of the date hereof.
The Surviving Corporation is a Wisconsin corporation having authorized
capital consisting of 200,000,000 Common Shares, $0.01 par value, of which 100
shares are issued and outstanding as of the date hereof, and 10,000,000
Preferred Shares, $.01 par value, of which no shares are issued and outstanding
as of the date hereof. All of the outstanding Common Shares of the Surviving
Corporation are owned by the Merging Corporation.
The Merging Corporation and the Surviving Corporation have determined it to
be advisable for the Merging Corporation to merge with and into the Surviving
Corporation (the "Merger") pursuant to the applicable provisions of the
Wisconsin Business Corporation Law and the Delaware General Corporation Law on
the terms hereinafter set forth, and the Boards of Directors of the Merging
Corporation and Surviving Corporation have each approved and adopted this
Agreement and Plan of Merger and authorized the execution hereof.
PLAN OF MERGER
In consideration of the premises, the parties hereto adopt arid make this
Agreement and Plan of Merger and prescribe the terms and conditions of such
Merger and the manner of carrying the same into effect, which shall be as
follows:
1. Effective 9:00 a.m., Milwaukee time, on June 4, 1993, (such time and
date being referred to herein as the "Effective Date"), the Merging Corporation
shall be merged with and into the Surviving Corporation.
2. The manner and basis of converting the issued and outstanding shares of
the Merging Corporation's stock and the outstanding stock options granted under
the Merging Corporation's 1992 Long Term Compensation Plan (the "Incentive
Plan") into shares of stock and stock options of the Surviving Corporation shall
be as follows:
4
<PAGE>
(a) At the Effective Date each share, of Common Stock of the Merging
Corporation issued and outstanding shall, without any action on
the part of either of the Constituent Corporations or any holder
of such share, be converted into one fully paid and nonassessable
Common Share of the Surviving Corporation (subject to the
liability under Section 180.0622(2)(b) of the Wisconsin
Statutes).
(b) Each stock certificate which, prior to the Effective Date,
represented issued and outstanding shares of the Common Stock of
the Merging Corporation shall be and become on the Effective Date
a certificate representing an identical number of Common Shares
of the Surviving Corporation, automatically by virtue of the
Merger and without any action on the part of the holder thereof.
(c) At the Effective Date, each share of Common Stock of the Merging
Corporation held as treasury stock shall be cancelled and
returned to the status of authorized but unissued shares.
(d) Each stock option granted by the Merging Corporation (under or
subject to the Incentive Plan of the Merging Corporation) and
outstanding immediately prior to the Effective Date shall, by
virtue of the Merger and without any action on the part of the
holder thereof, be converted into and become a stock option to
purchase, upon the same terms and conditions, an identical number
of the Surviving Corporation's Common Shares (subject to future
adjustments as may be provided in the Incentive Plan). The price
per share payable upon exercise under each of said options shall
(subject to future adjustments as may be provided in the
Incentive Plan) be equal to the exercise price per share
thereunder immediately prior to the Effective Date. A number of
the Surviving Corporation's Common Shares shall be reserved for
issuance upon the exercise of options equal to the number of
shares of the Merging Corporation's Common Stock so reserved
immediately prior to the Effective Date.
3. At the Effective Date all of the Common Shares of the Surviving
Corporation issued and outstanding immediately prior to the Effective Date of
the Merger shall be cancelled and returned to the status of authorized but
unissued shares.
4. On the Effective Date, each employee benefit plan and incentive
compensation plan to which the Merging Corporation is then a party shall be
assumed by, and continue to be the plan of, the Surviving Corporation. To the
extent any employee benefit plan or incentive compensation plan of the Merging
Corporation or any of its subsidiaries provides for the issuance or purchase of,
or otherwise relates to, the Merging Corporation's Common Stock, after the
Effective Date such plan shall be deemed to provide for the issuance or purchase
of, or otherwise relate to, the Surviving Corporation's Common Shares upon the
same terms and conditions.
5
<PAGE>
5. The officers and directors of the Surviving Corporation on the
Effective Date shall be and continue to be the officers and directors of the
Surviving Corporation thereafter, until their successors are duly appointed or
elected.
6. Upon the Effective Date, the Articles of Incorporation of the Surviving
Corporation shall be amended as follows:
Article I of the Surviving Corporation's Articles of Incorporation shall be
amended to change the name of the Surviving Corporation to "Kohl's Corporation."
The Articles of Incorporation of the Surviving Corporation, as so amended, shall
remain in effect as the Articles of Incorporation of the Surviving Corporation
after the Merger.
7. The Bylaws of the Surviving Corporation, as they exist immediately
prior to the Effective Date, shall remain in effect as the Bylaws of the
Surviving Corporation thereafter, unaffected by the Merger.
8. On the Effective Date, the Merging Corporation shall be merged with and
into the Surviving Corporation, which shall continue its corporate existence
under the laws of the State of Wisconsin. The separate existence and corporate
organization of the Merging Corporation shall cease upon the Effective Date, and
the Surviving Corporation shall possess all of the rights, privileges, powers
and franchises, as well of a public as of a private nature, of each of the
Constituent Corporations; and all property, real, personal and mixed, and all
debts due on whatever account, including subscriptions to shares, and all other
things in action, and all and every other interest, of or belonging to or due to
each of the Constituent Corporations, shall be taken and deemed to be
transferred to and vested in the Surviving Corporation without further act or
deed; and the title to any real estate, or any interest therein, vested in
either of the Constituent Corporations shall not revert or be in any way
impaired by reason of such Merger. The Surviving Corporation shall thenceforth
be responsible and liable for all the liabilities and obligations of each of the
Constituent Corporations, and any claims existing or action or proceeding
pending by or against the Constituent Corporations may be prosecuted to judgment
as if such Merger had not taken place. Neither the rights of creditors nor any
liens upon the property of either Constituent Corporation shall be impaired by
the Merger.
9. This Agreement and Plan of Merger shall be submitted to the
shareholders of each of the Constituent Corporations hereto in accordance with
the applicable provisions of law, and the consummation of the Merger herein
provided for is conditioned upon the approval and adoption hereof by the
shareholders of the respective parties as provided by law.
10. This Agreement and Plan of Merger and the Merger herein contemplated
may be abandoned by the Board of Directors of either of the Constituent
Corporations at any time prior to the Effective Date. This Agreement may be
amended, modified or supplemented at any time (before or after shareholder
approval) prior to the Effective Date with the mutual consent of the Boards of
Directors of the Merging Corporation and the Surviving Corporation; provided,
6
<PAGE>
however, that this Agreement may not be amended, modified or supplemented after
it has been approved by the Merging Corporation's shareholders in any manner
which. in the judgment of the Board of Directors of the Merging Corporation,
would have a material adverse effect on the rights of the Merging Corporation's
shareholders or in any manner not permitted under applicable law.
IN WITNESS WHEREOF, the parties have caused this Agreement and Plan of
Merger to be executed by their duly authorized officers, all as of the day and
year first above written.
KOHL'S CORPORATION,
a Delaware corporation
By: /s/ William S. Kellogg
-----------------------
William S. Kellogg
Chairman of the Board and
Chief Executive Officer
KOHL'S WISCONSIN CORPORATION,
a Wisconsin corporation
By: /s/ William S. Kellogg
-----------------------
William S. Kellogg
Chairman of the Board and
Chief Executive Officer
7
<PAGE>
ARTICLES OF INCORPORATION
-------------------------
OF
--
KOHL'S WISCONSIN CORPORATION
----------------------------
The undersigned incorporator, acting as incorporator of a corporation under
the Wisconsin Business Corporation Law Chapter 180 of the Wisconsin Statutes
(the "WBCL"), adopts the following Articles of Incorporation for such
corporation:
ARTICLE I
Name
----
The name of the corporation is Kohl's Wisconsin Corporation.
ARTICLE II
Purposes
--------
The purposes for which the corporation is organized are to engage in any
lawful activity within the purposes for which a corporation may be organized
under the WBCL.
ARTICLE III
Capital Stock
-------------
The aggregate number of shares which the corporation shall have the
authority to issue, the designation of each class of shares, the authorized
number of shares of each class and the par value thereof per share shall be as
follows:
<TABLE>
<CAPTION>
Designation Class Par Value Per Share Authorized Number of Shares
- ----------------- ------------------- ---------------------------
<S> <C> <C>
Common Shares $ .01 200,000,000
Preferred Shares $ .01 10,000,000
</TABLE>
The preferences, limitations and relative rights of shares of each class of
stock shall be as follows:
A. Common Shares.
(1) Voting. Except as otherwise provided by law and subject to the
rights of holders of any series of Preferred Shares, only the holders of Common
Shares shall be entitled to vote for the election of directors of the
corporation and for all other corporate purposes. Except as
8
<PAGE>
otherwise provided by law, upon any such vote, each holder of Common Shares
shall be entitled to one vote for each common Share held of record by such
shareholder.
(2) Dividends. Subject to the rights of holders of any series of Preferred
Shares, the holders of Common Shares shall be entitled to receive such dividends
as may be declared thereon from time to time by the Board Of Directors, in its
discretion, out of any funds of the corporation at the time legally available
for payment of dividends on Common Shares.
(3) Liquidation. In the event of the voluntary or involuntary
dissolution, liquidation or winding up of the corporation, after there have been
paid to or set aside for the holders of any series of Preferred Shares the full
preferential amounts, if any, to which they are entitled, the holders of
outstanding Common Shares shall be entitled to share ratably, according to the
number of shares held by each, in the remaining assets of the corporation
available for distribution.
B. Preferred Shares.
The Preferred Shares may be issued from time to time in one or more series
in any manner permitted by law and the provisions of the Articles of
Incorporation of the corporation, as determined from time to time by the Board
of Directors and stated in the resolution or resolutions providing for the
issuances thereof, prior to the issuances of any shares thereof. Unless
otherwise provided in the resolution establishing a series of Preferred Shares,
prior to the issue of any shares of a series so established or to be
established, the Board of Directors may, by resolution, amend the relative
rights and preferences of the shares of such series.
The designations and the powers, preferences and rights, and the
qualifications, limitations or restrictions thereof, of each series of Preferred
Shares shall be governed by the following provisions:
(i) The Board of Directors is expressly authorized at any time, and
from time to time, to provide for the issuance of Preferred Shares in one
or more series, with such voting powers, full or limited, or without voting
powers and with such designations, preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof, as shall be stated and expressed in the resolution or
resolutions providing for the issue thereof adopted by the Board of
Directors, including (but not limiting the generality thereof) the
following:
(A) The number of shares to constitute each such series, and the
designation of each such series.
(B) The dividend rate of each such series, the conditions and
dates upon which such dividends shall be payable, the relation which
such dividends shall bear to the dividends payable on any other class
or classes or on any other series of any class or classes of stock,
and whether such dividends shall be cumulative, noncumulative or
partially cumulative,
9
<PAGE>
(C) Whether the shares of each such series shall be subject to
redemption by the corporation and if made subject to such redemption,
the times, prices and other terms and conditions of such redemption.
(D) The terms and amount of any sinking fund provided for the
purchase or redemption of the shares of each such series.
(E) Whether or not the shares of each such series shall be
convertible into or exchangeable for any other securities of the
corporation, including shares of any other class, classes or series of
any other class or classes of stock of the corporation, or any debt
securities of the corporation, and, if provision be made for
conversion or exchange, the times, prices, rates of exchange,
adjustments, and other terms and conditions of such conversion or
exchange.
(F) The extent, if any, to which the holders of the shares of
each such series shall be entitled to vote with respect to the
election of directors or otherwise.
(G) The restrictions, if any, on the issue or reissue of any
additional Preferred Shares.
(H) The rights of the holders of the shares of each such series
upon the dissolution of, or upon the distribution of the assets of,
the corporation.
(ii) Except as otherwise required by law and except for such voting
powers with respect to the election of directors or other matters as may be
stated in the resolutions of the Board of Directors creating any series of
Preferred Shares, the holders of any such series shall have no voting
powers whatsoever.
ARTICLE IV
Preemptive Rights
-----------------
No holder of any capital stock of the corporation shall have any preemptive
right to purchase, subscribe for, or otherwise acquire any shares of the
corporation of any class now or hereafter authorized, or any securities
exchangeable for or convertible into such shares.
ARTICLE V
Board of Directors
------------------
(a) Number of Directors, Tenure and Qualifications. Except as provided
pursuant to subparagraph (d) of this Article V, the number of directors
constituting the Board of Directors of the corporation shall be such number, not
less than 5 nor more than 15, as from time to time shall be determined by the
then authorized number of directors; provided, however, that no decrease in
10
<PAGE>
the number of directors shall have the effect of shortening the term of any
incumbent director. The Board of Directors shall be and is divided into three
classes, designated Class I, Class II and Class III. The initial Class I
directors shall be William S. Kellogg and Lawrence B. Sorrel; the initial Class
II directors shall be Jay H. Baker, Herbert Simon and Peter M. Sommerhauser; and
the initial Class III directors shall be John F. Herma, Jules Allen and Frank V.
Sica. Each class shall consist, as nearly as may be possible, of one-third of
the total number of directors constituting the entire Board of Directors, with
the term of office of the directors of one class expiring each year. Each
director shall serve for a term ending on the date of the third annual meeting
following the annual meeting at which such director was elected; provided,
however, the initial Class I directors shall serve for a term ending on the date
of the annual meeting of shareholders held in 1993, the initial Class II
directors shall serve for a term ending on the date of the annual meeting of
shareholders held in 1994, and the initial Class III directors shall serve for a
term ending on the date of the annual meeting of shareholders held in 1995. Each
director shall hold office until the annual meeting for the year in which his
term expires and until such director's successor shall be elected and qualified,
subject, however, to such director's earlier death, resignation,
disqualification or removal from office.
(b) Vacancies. Any vacancy on the Board of Directors, whether resulting
from an increase in the number of directors or resulting from death,
resignation, disqualification, removal or otherwise, other than a vacancy with
respect to a director elected as provided pursuant to subparagraph (d) of this
Article V, shall be filled by the vote of the majority of the directors then in
office (excluding directors, if any, elected as provided pursuant to
subparagraph (d) of this Article V), even if less than a quorum, or by a sole
remaining director. If no director remains in office, any vacancy may be filled
by the shareholders. Any director so elected to fill any vacancy on the Board of
Directors, including a vacancy created by an increase in the number of
directors, shall hold office for the remaining term of directors of the class to
which he has been elected and until his successor shall be elected and shall
qualify.
(c) Removal of Directors. Exclusive of directors, if any, elected as
provided pursuant to subparagraph (d) of this Article V, a director of the
corporation may be removed from office prior to the expiration of his term of
office at any time, but only for cause and only by the affirmative vote of a
majority of the outstanding shares of capital stock of the corporation entitled
to vote with respect to the election of such director at a meeting of the
shareholders duly called for such purpose.
(d) Directors Elected by Preferred Shares. Notwithstanding the foregoing,
whenever the holders of any one or more series of Preferred Shares issued by the
corporation shall have the right, voting pursuant to the term of such Preferred
Shares, to elect directors at an annual or special meeting of shareholders, the
election, term of office, filling of vacancies and other features of such
directorships shall be governed by the terms of such Preferred Shares. Unless
expressly provided by such terms, directors so elected shall not be divided into
classes and, during the prescribed terms of office of such directors, the Board
of Directors shall consist of such number of directors determined as provided in
subparagraph (a) of this Article V plus the number of directors determined as
provided in this subparagraph (d) of this Article V.
11
<PAGE>
(e) Shareholder Nominations. Advance notice of shareholder nominations for
the election of directors shall be given in the manner provided in the Bylaws of
the corporation.
(f) Amendment or Repeal. Notwithstanding any other provisions of these
Articles of Incorporation or the Bylaws of the corporation (and notwithstanding
the fact that a lesser percentage may be specified by law, these Articles of
Incorporation or the Bylaws of the corporation), the affirmative vote of the
holders of 80% or more of the combined voting power of the then outstanding
shares of stock entitled to vote on the matter, voting together as a single
class, shall be required to alter, amend, adopt any provision inconsistent with,
or repeal this Article V.
ARTICLE VI
Shareholder Action
------------------
The shareholders shall not be entitled to take action without a meeting by
less than unanimous consent. Except as otherwise required by law and subject to
the express rights of the holders of any class or series of stock having a
preference over the Common Shares as to dividends or upon liquidation, annual
and special meetings of the shareholders shall be called, the record date or
dates shall be determined and notice shall be sent as set forth in the Bylaws of
the corporation. Notwithstanding any other provisions of these Articles of
Incorporation or the Bylaws of the corporation (and notwithstanding the fact
that a lesser affirmative vote may be specified by law, these Articles of
Incorporation or the Bylaws of the corporation), the affirmative vote of the
holders of 80% or more of the combined voting power of the then outstanding
shares of stock entitled to vote on the matter, voting together as a single
class, shall be required to alter, amend, adopt any provision inconsistent with,
or repeal Articles II or VIII of the Bylaws, or this Article VI or any provision
thereof or hereof; provided, however, that the Board of Directors may alter,
amend, or adopt any provision inconsistent with, or repeal Articles II or VIII
of the Bylaws, or any provision thereof, without a vote of shareholders.
ARTICLE VII
Registered Office and Agent
---------------------------
The address of the initial registered office of the corporation is 44 East
Mifflin Street, Madison, Dane County, Wisconsin 53703 and the name of its
initial registered agent at such address is C T Corporation System.
12
<PAGE>
ARTICLE VIII
Incorporator
------------
The name and address of the incorporator is Peter M. Sommerhauser, 780
North Water Street, Milwaukee, Wisconsin 53202.
Executed this 19th day of March, 1993.
/s/ Peter M. Sommerhauser
-------------------------
Peter M. Sommerhauser
This instrument was drafted by:
Larry D. Lieberman
Godfrey & Kahn, S.C.,
780 N. Water Street
Milwaukee, Wisconsin 53202
13
<PAGE>
Exhibit 12.1
Kohl's Corporation
Ratio of Earnings to Fixed Charges
($000s)
<TABLE>
<CAPTION>
26 Weeks Ended
---------------------
July 31, Aug. 1 Fiscal Year (1)
---------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings
- --------
Income before income taxes and
extraordinary items $137,933 $95,876 $316,749 $235,063 $171,368 $122,729 $117,451
Fixed charges (3) 37,430 30,392 63,135 57,446 42,806 30,649 19,758
Less interest capitalized
during period (1,728) (907) (1,878) (2,043) (2,829) (1,287) (603)
--------- --------- --------- --------- --------- --------- ---------
$173,635 $125,361 $378,006 $290,466 $211,345 $152,091 $136,606
========= ========= ========= ========= ========= ========= =========
Fixed Charges
- -------------
Interest (expensed or capitalized) (3) $14,459 $12,087 $24,550 $26,304 $20,574 $14,774 $7,911
Portion of rent expense
representative of interest 22,842 18,205 38,385 30,798 22,031 15,798 11,777
Amortization of deferred
financing fees 129 100 200 344 201 77 70
--------- --------- --------- --------- --------- --------- ---------
$37,430 $30,392 $63,135 $57,446 $42,806 $30,649 $19,758
========= ========= ========= ========= ========= ========= =========
Ratio of earnings to fixed charges 4.64 4.12 5.99 5.06 4.94 4.96 (2) 6.91
========= ========= ========= ========= ========= ========= =========
</TABLE>
(1) Fiscal 1998, 1997, 1996 and 1994 are 52 week years and fiscal 1995 is a 53
week year.
(2) Excluding the credit operations non-recurring expense of $14,052, the ratio
of earnings to fixed charges would be 5.40.
(3) Interest expense for fiscal 1997, 1996, and 1995 has been restated to
properly reflect interest expense included on the Consolidated Statements
of Income.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JAN-29-2000
<PERIOD-START> JAN-31-1999
<PERIOD-END> JUL-31-1999
<CASH> 2,960
<SECURITIES> 58,753
<RECEIVABLES> 401,826
<ALLOWANCES> 6,821
<INVENTORY> 753,964
<CURRENT-ASSETS> 1,237,872
<PP&E> 1,325,989
<DEPRECIATION> 239,004
<TOTAL-ASSETS> 2,521,792
<CURRENT-LIABILITIES> 430,404
<BONDS> 498,667
0
0
<COMMON> 1,629
<OTHER-SE> 1,502,418
<TOTAL-LIABILITY-AND-EQUITY> 2,521,792
<SALES> 1,849,759
<TOTAL-REVENUES> 1,849,759
<CGS> 1,211,327
<TOTAL-COSTS> 1,700,206
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 11,620
<INCOME-PRETAX> 137,933
<INCOME-TAX> 53,381
<INCOME-CONTINUING> 84,552
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 84,552
<EPS-BASIC> 0.52
<EPS-DILUTED> 0.51
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JAN-30-1999
<PERIOD-START> FEB-01-1998
<PERIOD-END> AUG-01-1998
<CASH> 2,534
<SECURITIES> 14,850
<RECEIVABLES> 195,097
<ALLOWANCES> 3,578
<INVENTORY> 634,805
<CURRENT-ASSETS> 856,800
<PP&E> 1,011,736
<DEPRECIATION> 180,620
<TOTAL-ASSETS> 1,748,949
<CURRENT-LIABILITIES> 346,322
<BONDS> 312,659
0
0
<COMMON> 1,581
<OTHER-SE> 1,013,844
<TOTAL-LIABILITY-AND-EQUITY> 1,748,949
<SALES> 1,503,318
<TOTAL-REVENUES> 1,503,318
<CGS> 993,272
<TOTAL-COSTS> 1,397,182
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 10,260
<INCOME-PRETAX> 95,876
<INCOME-TAX> 37,680
<INCOME-CONTINUING> 58,196
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 58,196
<EPS-BASIC> 0.37
<EPS-DILUTED> 0.36
</TABLE>
