Kohl's 2006 Annual Report Download - page 17

16
SUCCESS through Performance
Fiscal Year 2006 2005 2004 2003 2002 2001
Summary of Operations (In millions)
Net sales $ 15,544 $ 13,402
Gross margin 5,654 4,763
Selling, general & administrative expenses 3,401 2,964
Preopening expenses 50 44
Depreciation and amortization 388 339
Operating income 1,815 1,416
Interest expense, net 41 70
Income before income taxes 1,774 1,346
Net income 1,109 842
Diluted Earnings Per Share $ 3.31 $ 2.43 $ 2.04 $ 1.59 $ 1.75 $ 1.35
Financial Position Data (Dollars in millions)
Working capital $ 1,482 $ 2,520 $ 2,187 $ 1,902 $ 1,776 $ 1,584
Property and equipment, net 5,353 4,616 4,063 3,390 2,806 2,253
Total assets 9,041 9,153 7,979 6,691 6,311 4,927
Long-term debt 1,040 1,046 1,103 1,076 1,059 1,095
Shareholders’ equity 5,603 5,957 5,034 4,212 3,532 2,803
Return on average shareholders’ equity 19.2 % 15.3 % 15.2 % 14.1 % 19.0 % 18.3 %
Other Data
Comparable store sales growth 5.9 % 3.4 % 0.3 % (1.6 )% 5.3 % 6.8 %
Net sales per selling square foot $ 256 $ 252 $ 255 $ 268 $ 284 $ 283
Stores open at year end 817 732 637 542 457 382
Total square feet of selling space (In thousands) 62,357 56,625 49,201 41,447 34,507 28,576
Strength
Report of Management
The management of Kohl’s Corporation is responsible for the integrity and objectivity of the fi nancial and operating information contained in this Annual Report,
including the consolidated fi nancial statements covered by the Report of Independent Registered Public Accounting Firm. These statements were prepared in
conformity with U.S. generally accepted accounting principles and include amounts that are based on the best estimates and judgments of management.
We remain committed to managing our business both ethically and responsibly and to representing the best interest of our shareholders through good corporate
governance. After thorough review by its Governance and Nominating Committee, the Board of Directors believes Kohl’s is in full compliance with all applicable
corporate governance rules of the Securities and Exchange Commission (SEC) and the New York Stock Exchange (NYSE). Accordingly, in 2006, Kohl’s provided
the NYSE with an unqualifi ed Annual CEO Certifi cation of Compliance, and has fi led with the SEC, as an exhibit to our Annual Report on Form 10-K for the
fi scal year 2006, the Sarbanes-Oxley Act Section 302 certifi cation regarding the quality of the company’s public disclosure.
The consolidated fi nancial statements and related notes have been audited by Ernst & Young LLP, independent registered public accounting fi rm, whose
report is based on audits conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States). The Company’s
consolidated fi nancial statements including the Report of Independent Registered Public Accounting Firm are included in the Company’s Form 10-K for the year
ended February 3, 2007.
The Audit Committee of the Board of Directors is composed of four independent Directors. The Committee is responsible for assisting the Board in its oversight
of Kohl’s fi nancial accounting and reporting practices. The Audit Committee is directly responsible for the compensation, appointment and oversight of the
Company’s independent registered public accounting fi rm. The Audit Committee meets periodically with the independent registered public accounting fi rm,
as well as with management, to review accounting, auditing, internal accounting control and fi nancial reporting matters. The independent registered public
accounting fi rm has unrestricted access to the Audit Committee.
Larry Montgomery Wesley S. McDonald
Chairman and Chief Executive Offi cer Executive Vice President - Chief Financial Offi cer
$10,282
3,395
2,158
47
239
951
73
878
546
$ 11,701
4,114
2,584
49
288
1,193
63
1,130
703
$ 9,120
3,139
1,884
41
193
1,021
56
965
601
$ 7,489
2,565
1,583
33
159
790
50
740
458