Target Corp. (Minneapolis) and Kohl’s Corp. (Menomonee Falls, Wis.) both reported second-quarter profits that topped Wall Street analysts’ expectations.
Both retailers reported strong sales of hot-weather apparel, saying heat waves drove demand. Target expanded its exclusive brands, like Mossimo swim tops, and Kohl’s said it sold more women’s clothing and accessories.
Net income at Target beat analysts’ estimates on a 14 percent sales increase. Kohl’s profits rose 27 percent.
Target’s net income dropped 62 percent, but that was largely due to the inflated figures a year ago when it sold its Marshall Field’s department store division to the May Department Stores Co. (St. Louis) for $3.2 billion. Revenues increased 13.6 percent and same-store sales rose 6.7 percent.
Kohl’s profit increased 27.4 percent and sales rose 16 percent for the three months ended July 30, 2005. Kohl’s is adding its own brands, including Daisy Fuentes camisoles and Oh Baby! maternity wear, to try to win middle-income shoppers from J.C. Penney (Plano, Texas) and Federated Department Stores (Cincinnati).
“Kohl’s has been in turnaround mode for quite a while, and that’s finally kicking in,” analyst Keri Spanbauer of Thrivent Investment Management (Appleton, Wis.) told The New York Times. “There’s been good reception for some of their new brands.”
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