Company Quick10K Filing
Kohl's
Price49.64 EPS4
Shares159 P/E11
MCap7,893 P/FCF8
Net Debt1,510 EBIT825
TEV9,403 TEV/EBIT11
TTM 2019-11-02, in MM, except price, ratios
10-Q 2020-10-31 Filed 2020-12-03
10-Q 2020-08-01 Filed 2020-09-03
10-Q 2020-05-02 Filed 2020-06-05
10-K 2020-02-01 Filed 2020-03-18
10-Q 2019-11-02 Filed 2019-12-06
10-Q 2019-08-03 Filed 2019-09-06
10-Q 2019-05-04 Filed 2019-06-07
10-K 2019-02-02 Filed 2019-03-22
10-Q 2018-11-03 Filed 2018-12-07
10-Q 2018-08-04 Filed 2018-09-07
10-Q 2018-05-05 Filed 2018-06-08
10-K 2018-02-03 Filed 2018-03-23
10-Q 2017-10-28 Filed 2017-12-01
10-Q 2017-07-29 Filed 2017-08-31
10-Q 2017-04-29 Filed 2017-06-02
10-K 2017-01-28 Filed 2017-03-17
10-Q 2016-10-29 Filed 2016-12-02
10-Q 2016-07-30 Filed 2016-09-02
10-Q 2016-04-30 Filed 2016-06-03
10-K 2016-01-30 Filed 2016-03-18
10-Q 2015-10-31 Filed 2015-12-04
10-Q 2015-08-01 Filed 2015-09-04
10-Q 2015-05-02 Filed 2015-06-05
10-K 2015-01-31 Filed 2015-03-20
10-Q 2014-11-01 Filed 2014-12-05
10-Q 2014-08-02 Filed 2014-09-05
10-Q 2014-05-03 Filed 2014-06-06
10-K 2014-02-01 Filed 2014-03-21
10-Q 2013-08-03 Filed 2013-09-04
10-Q 2013-05-04 Filed 2013-06-07
10-K 2013-02-02 Filed 2013-03-22
10-Q 2012-10-27 Filed 2012-11-30
10-Q 2012-07-28 Filed 2012-08-31
10-Q 2012-04-28 Filed 2012-06-01
10-Q 2011-10-29 Filed 2011-12-02
10-Q 2011-07-30 Filed 2011-09-13
10-Q 2011-04-30 Filed 2011-06-01
10-K 2011-01-29 Filed 2011-03-18
10-Q 2010-10-30 Filed 2010-12-09
10-Q 2010-07-31 Filed 2010-09-03
10-Q 2010-05-01 Filed 2010-06-04
10-K 2010-01-30 Filed 2010-03-19
8-K 2020-11-17
8-K 2020-10-20
8-K 2020-09-15
8-K 2020-09-08
8-K 2020-08-18
8-K 2020-06-08
8-K 2020-05-22
8-K 2020-05-19
8-K 2020-05-13
8-K 2020-05-07
8-K 2020-04-27
8-K 2020-04-16
8-K 2020-04-15
8-K 2020-04-15
8-K 2020-03-30
8-K 2020-03-19
8-K 2020-03-13
8-K 2020-03-09
8-K 2020-03-03
8-K 2020-02-02
8-K 2020-01-09
8-K 2019-11-19
8-K 2019-10-07
8-K 2019-09-16
8-K 2019-09-03
8-K 2019-08-28
8-K 2019-08-20
8-K 2019-07-25
8-K 2019-07-15
8-K 2019-05-21
8-K 2019-05-15
8-K 2019-04-18
8-K 2019-03-05
8-K 2019-01-29
8-K 2019-01-10
8-K 2018-12-20
8-K 2018-11-20
8-K 2018-08-21
8-K 2018-05-22
8-K 2018-05-09
8-K 2018-05-09
8-K 2018-04-26
8-K 2018-04-16
8-K 2018-04-13
8-K 2018-04-10
8-K 2018-04-02
8-K 2018-03-16
8-K 2018-03-01
8-K 2018-01-08

KSS 10Q Quarterly Report

Part I. Financial Information
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 6. Exhibits
EX-31.1 kss-ex311_8.htm
EX-31.2 kss-ex312_7.htm
EX-32.1 kss-ex321_9.htm
EX-32.2 kss-ex322_6.htm

Kohl's Earnings 2020-10-31

Balance SheetIncome StatementCash Flow
2016128402012201420172020
Assets, Equity
10.08.06.04.02.00.02012201420172020
Rev, G Profit, Net Income
1.10.70.3-0.0-0.4-0.82012201420172020
Ops, Inv, Fin

kss-10q_20201031.htm
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Table of Contents

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2020

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 incorporation or organization)

 

(I.R.S. Employer Identification No.)

 

 

 

N56 W17000 Ridgewood Drive,

Menomonee Falls, Wisconsin

 

53051

(Address of principal executive offices)

 

(Zip Code)

Registrant’s telephone number, including area code (262703-7000

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading

Symbol(s)

Name of each exchange on

which registered

Common Stock, $.01 par value

KSS

New York Stock Exchange

 

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      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

 

 

Accelerated Filer

 

Non-Accelerated Filer

 

  

 

Smaller Reporting Company

 

 

 

 

 

Emerging Growth Company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act.

Indicate by a check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).                Yes      No  

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: November 27, 2020 Common Stock, Par Value $0.01 per Share, 157,652,395 shares outstanding.

 

 

 

 


 

 

KOHL’S CORPORATION

INDEX

 

PART I

FINANCIAL INFORMATION

 

Item 1.

Financial Statements:

 

 

Consolidated Balance Sheets

3

 

Consolidated Statements of Operations

4

 

Consolidated Statements of Changes in Shareholders' Equity

5

 

Consolidated Statements of Cash Flows

6

 

Notes to Consolidated Financial Statements

7

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

12

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

21

Item 4.

Controls and Procedures

21

 

 

 

PART II

OTHER INFORMATION

 

Item 1A.

Risk Factors

22

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

22

Item 6.

Exhibits

23

 

Signatures

24

 

 


Table of Contents

 

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

KOHL’S CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

(Dollars in Millions)

October 31,

2020

February 1,

2020

November 2,

2019

Assets

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

$

1,939

 

$

723

 

$

490

 

Merchandise inventories

 

3,607

 

 

3,537

 

 

4,887

 

Income tax receivable

 

115

 

 

15

 

 

25

 

Other

 

335

 

 

374

 

 

379

 

Total current assets

 

5,996

 

 

4,649

 

 

5,781

 

Property and equipment, net

 

6,876

 

 

7,352

 

 

7,364

 

Operating leases

 

2,422

 

 

2,391

 

 

2,427

 

Other assets

 

150

 

 

163

 

 

167

 

Total assets

$

15,444

 

$

14,555

 

$

15,739

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

 

Accounts payable

$

2,184

 

$

1,206

 

$

2,454

 

Accrued liabilities

 

1,272

 

 

1,233

 

 

1,347

 

Income taxes payable

 

 

 

48

 

 

2

 

Current portion of:

 

 

 

 

 

 

 

 

 

Finance lease and financing obligations

 

127

 

 

124

 

 

110

 

Operating leases

 

160

 

 

158

 

 

162

 

Total current liabilities

 

3,743

 

 

2,769

 

 

4,075

 

Long-term debt

 

2,450

 

 

1,856

 

 

1,856

 

Finance lease and financing obligations

 

1,402

 

 

1,367

 

 

1,332

 

Operating leases

 

2,644

 

 

2,619

 

 

2,643

 

Deferred income taxes

 

74

 

 

260

 

 

258

 

Other long-term liabilities

 

293

 

 

234

 

 

220

 

Shareholders’ equity:

 

 

 

 

 

 

 

 

 

Common stock

 

4

 

 

4

 

 

4

 

Paid-in capital

 

3,303

 

 

3,272

 

 

3,256

 

Treasury stock, at cost

 

(11,594

)

 

(11,571

)

 

(11,490

)

Retained earnings

 

13,125

 

 

13,745

 

 

13,585

 

Total shareholders’ equity

$

4,838

 

$

5,450

 

$

5,355

 

Total liabilities and shareholders’ equity

$

15,444

 

$

14,555

 

$

15,739

 

 

See accompanying Notes to Consolidated Financial Statements

 

3


Table of Contents

 

KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

Three Months Ended

Nine Months Ended

(Dollars in Millions, Except per Share Data)

October 31,

2020

November 2,

2019

October 31,

2020

November 2,

2019

Net sales

$

3,779

 

$

4,358

 

$

9,152

 

$

12,348

 

Other revenue

 

200

 

 

267

 

 

662

 

 

794

 

Total revenue

 

3,979

 

 

4,625

 

 

9,814

 

 

13,142

 

Cost of merchandise sold

 

2,424

 

 

2,775

 

 

6,360

 

 

7,740

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general, and administrative

 

1,302

 

 

1,419

 

 

3,418

 

 

3,962

 

Depreciation and amortization

 

210

 

 

227

 

 

656

 

 

687

 

Impairments, store closing, and other costs

 

21

 

 

 

 

85

 

 

55

 

(Gain) on sale of real estate

 

 

 

 

(127

)

 

Operating income (loss)

 

22

 

 

204

 

 

(578

)

 

698

 

Interest expense, net

 

78

 

 

52

 

 

214

 

 

157

 

(Gain) loss on extinguishment of debt

 

 

 

(9

)

 

 

 

(9

)

(Loss) income before income taxes

 

(56

)

 

161

 

 

(792

)

 

550

 

(Benefit) provision for income taxes

 

(44

)

 

38

 

 

(286

)

 

124

 

Net (loss) income

$

(12

)

$

123

 

$

(506

)

$

426

 

Net (loss) income per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

(0.08

)

$

0.79

 

$

(3.28

)

$

2.69

 

Diluted

$

(0.08

)

$

0.78

 

$

(3.28

)

$

2.67

 

 

See accompanying Notes to Consolidated Financial Statements

 

4


Table of Contents

 

KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited)

 

 

Three Months Ended

Nine Months Ended

(Dollars in Millions, Except per Share Data)

October 31, 2020

November 2, 2019

October 31, 2020

November 2, 2019

Common stock

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

$

4

 

$

4

 

$

4

 

$

4

 

Stock-based awards

 

 

 

 

 

 

 

 

Balance, end of period

$

4

 

$

4

 

$

4

 

$

4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Paid-in capital

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

$

3,290

 

$

3,236

 

$

3,272

 

$

3,204

 

Stock-based awards

 

13

 

 

20

 

 

31

 

 

52

 

Balance, end of period

$

3,303

 

$

3,256

 

$

3,303

 

$

3,256

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Treasury stock, at cost

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

$

(11,594

)

$

(11,353

)

$

(11,571

)

$

(11,076

)

Treasury stock purchases

 

 

 

(133

)

 

(8

)

 

(387

)

Stock-based awards

 

 

 

(5

)

 

(21

)

 

(32

)

Dividends paid

 

 

 

1

 

 

6

 

 

5

 

Balance, end of period

$

(11,594

)

$

(11,490

)

$

(11,594

)

$

(11,490

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Retained earnings

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

$

13,137

 

$

13,568

 

$

13,745

 

$

13,395

 

Change in accounting standard (a)

 

 

 

 

 

 

 

88

 

Net (loss) income

 

(12

)

 

123

 

 

(506

)

 

426

 

Dividends paid

 

 

 

(106

)

 

(114

)

 

(324

)

Balance, end of period

$

13,125

 

$

13,585

 

$

13,125

 

$

13,585

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total shareholders' equity, end of period

$

4,838

 

$

5,355

 

$

4,838

 

$

5,355

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

 

 

 

 

 

 

 

 

 

 

 

Shares, beginning of period

 

377

 

 

375

 

 

375

 

 

374

 

Stock-based awards

 

 

 

 

 

2

 

 

1

 

Shares, end of period

 

377

 

 

375

 

 

377

 

 

375

 

Treasury stock

 

 

 

 

 

 

 

 

 

 

 

 

Shares, beginning of period

 

(219

)

 

(215

)

 

(219

)

 

(211

)

Treasury stock purchases

 

 

 

(3

)

 

 

 

(7

)

Shares, end of period

 

(219

)

 

(218

)

 

(219

)

 

(218

)

Total shares outstanding, end of period

 

158

 

 

157

 

 

158

 

 

157

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends paid per common share

$

 

$

0.67

 

$

0.704

 

$

2.01

 

 

 

(a)

Adoption of new lease accounting standard in 2019.

 

See accompanying Notes to Consolidated Financial Statements 

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KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

Nine Months Ended

(Dollars in Millions)

October 31,

2020

November 2,

2019

Operating activities

 

 

 

 

 

 

Net (loss) income

$

(506

)

$

426

 

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

656

 

 

687

 

Share-based compensation

 

26

 

 

47

 

Deferred income taxes

 

(181

)

 

45

 

Impairments, store closing, and other costs

 

49

 

 

45

 

(Gain) on sale of real estate

 

(127

)

 

 

(Gain) loss on extinguishment of debt

 

 

 

(9

)

Non-cash inventory costs

 

187

 

 

 

Non-cash lease expense

 

111

 

 

112

 

Other non-cash expense (income)

 

15

 

 

(3

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

Merchandise inventories

 

(251

)

 

(1,405

)

Other current and long-term assets

 

54

 

 

34

 

Accounts payable

 

978

 

 

1,266

 

Accrued and other long-term liabilities

 

159

 

 

(26

)

Income taxes

 

(147

)

 

(49

)

Operating lease liabilities

 

(113

)

 

(125

)

Net cash provided by operating activities

 

910

 

 

1,045

 

Investing activities

 

 

 

 

 

 

Acquisition of property and equipment

 

(264

)

 

(678

)

Proceeds from sale of real estate

 

194

 

 

 

Other

 

 

 

8

 

Net cash used in investing activities

 

(70

)

 

(670

)

Financing activities

 

 

 

 

 

 

Proceeds from issuance of debt

 

2,097

 

 

 

Deferred financing costs

 

(19

)

 

 

Treasury stock purchases

 

(8

)

 

(387

)

Shares withheld for taxes on vested restricted shares

 

(21

)

 

(32

)

Dividends paid

 

(108

)

 

(319

)

Reduction of long-term borrowings

 

(1,497

)

 

(6

)

Finance lease and financing obligation payments

 

(72

)

 

(88

)

Proceeds from stock option exercises

 

 

 

2

 

Proceeds from financing obligations

 

4

 

 

11

 

Net cash provided by (used in) financing activities

 

376

 

 

(819

)

Net increase (decrease) in cash and cash equivalents

 

1,216

 

 

(444

)

Cash and cash equivalents at beginning of period

 

723

 

 

934

 

Cash and cash equivalents at end of period

$

1,939

 

$

490

 

Supplemental information

 

 

 

 

 

 

Interest paid, net of capitalized interest

$

159

 

$

131

 

Income taxes paid

 

138

 

 

154

 

Property and equipment acquired through:

 

 

 

 

 

 

   Finance lease liabilities

 

118

 

 

163

 

   Operating lease liabilities

 

140

 

 

103

 

 

See accompanying Notes to Consolidated Financial Statements

 

 

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Table of Contents

 

KOHL’S CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for fiscal year end Consolidated 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 Consolidated Financial Statements and related footnotes included in our Annual Report on Form 10-K for the fiscal year ended February 1, 2020 (Commission File No. 1-11084) as filed with the Securities and Exchange Commission.

Due to the seasonality of the business of Kohl’s Corporation (the “Company,” “Kohl’s,” “we,” “our,” or “us”) and the uncertainty surrounding the financial impact of the novel coronavirus (“COVID-19”) pandemic, results for any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year.

We operate as a single business unit.

Accounting Policies

The accounting policies the Company follows are set forth in its most recently filed Annual Report on Form 10-K. There have been no material changes to these accounting policies except as discussed below.

Use of Estimates

The preparation of Consolidated Financial Statements in conformity with U.S GAAP requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. We believe that our accounting estimates are appropriate and reflect the increased uncertainties surrounding the severity and duration of the COVID-19 pandemic. Actual results could differ from those estimates.

Leases

In the first quarter of 2020, we negotiated rent deferrals for a significant number of our stores, with repayment at later dates, primarily in the third and fourth quarter of 2020 and first and second quarter of 2021. These concessions provide a deferral of rent payments with no substantive changes to the original contract. Consistent with updated guidance from the Financial Accounting Standards Board (“FASB”) in April 2020, we have elected to treat the COVID-19 pandemic-related rent deferrals as accrued liabilities. We will continue to recognize expense during the deferral periods.

In the second quarter of 2020, we completed a sale leaseback for our San Bernardino E-commerce fulfillment and distribution center. The properties were sold for $195 million and generated net proceeds of $193 million after fees. A gain of $127 million was recognized during the second quarter of 2020 and is recorded in gain on sale of real estate. An initial operating lease liability and a corresponding right of use asset of $84 million were recorded for these leased locations.

In the third quarter of 2019, we purchased leased equipment that was accounted for as a financing obligation and resulted in recognition of a $9 million gain on extinguishment of debt.

Merchandise Inventories

Merchandise inventories are valued at the lower of cost or market using the Retail Inventory Method ("RIM"). Under RIM, the valuation of inventory at cost and the resulting gross margins are calculated by applying a cost-to-retail ratio to the retail value of inventory. RIM is an averaging method that has been widely used in the retail industry due

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to its practicality. The use of RIM will result in inventory being valued at the lower of cost or market since permanent markdowns are taken as a reduction of the retail value of inventories. A reserve would be recorded if the future estimated selling price is less than cost.

In the first quarter of 2020, as a result of the COVID-19 pandemic and store closures, we recorded a reserve of $163 million for excess seasonal inventory where the expected selling price was less than cost for the quarter ended May 2, 2020. No reserve was required for the quarter ended October 31, 2020 or November 2, 2019.

Property and Equipment and Long Lived Assets

All property and equipment and other long-lived assets are reviewed for potential impairment at least annually or when events or changes in circumstances indicate that the asset’s carrying value may not be recoverable. If such indicators are present, it is determined whether the sum of the estimated undiscounted future cash flows attributable to such assets is less than the carrying value of the assets. A potential impairment has occurred if projected future undiscounted cash flows are less than the carrying value of the assets. Given the substantial reduction in our sales and the reduced cash flow projections as a result of the store closures due to the COVID-19 pandemic, we determined that a triggering event occurred in the first quarter of 2020 and an impairment assessment was warranted for certain stores and other long lived assets. Based on this assessment, we recorded impairment charges of $51 million in the first quarter of 2020 in Impairments, store closing, and other costs. In connection with the closure of four stores in the first quarter of 2019, we recorded impairment charges of $49 million in the first quarter of 2019 in Impairments, store closing, and other costs. We recorded impairment charges of $10 million in the second quarter of 2019 related to the closure of our four Off-Aisle clearance centers in Impairments, store closing, and other costs.

In the third quarter of 2020, we reclassified $22 million of assets held for sale to assets to be held and used. As of October 31, 2020, we did not have any assets held for sale.

Restructuring Reserve

The following table summarizes changes in the restructuring reserve during the nine months ended October 31, 2020:

 

(Dollars In Millions)

Severance

Balance - February 1, 2020

$

27

 

Payments and reversals

 

(34

)

Additions

 

23

 

Balance - October 31, 2020

$

16

 

 

Charges related to corporate restructuring efforts are recorded in Impairments, store closing, and other costs. 

Recent Accounting Pronouncements

We adopted the new accounting standard on accounting for expected credit losses (ASU 2016-13), effective at the beginning of fiscal 2020. We applied the new principle using a modified retrospective approach. There was no material impact on our financial statements due to adoption of the new standard.

We adopted the new accounting standard on recognizing implementation costs related to a cloud computing arrangement (ASU 2018-15), effective at the beginning of fiscal 2020. We applied the new principle using a prospective approach. There was no material impact on our financial statements due to adoption of the new standard.  

  

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Table of Contents

 

The following table provides a brief description of issued, but not yet effective, accounting standards:

 

Standard

Description

Effect on our Financial Statements

Income Taxes

(ASU 2019-12)

 

Issued December 2019

 

Effective Q1 2021

The new standard is designed to simplify the accounting for income taxes by removing certain exceptions to the general principles as outlined in U.S. GAAP.

We are evaluating the impact of the new standard on our financial statements.

 

 

 

2. Revenue Recognition

The following table summarizes net sales by line of business:

 

 

Three Months Ended

Nine Months Ended

(Dollars in Millions)

October 31, 2020

November 2, 2019

October 31, 2020

November 2, 2019

Women's

$

1,025

 

$

1,267

 

$

2,569

 

$

3,868

 

Home

 

700

 

 

639

 

 

1,840

 

 

1,786

 

Men's

 

711

 

 

899

 

 

1,672

 

 

2,538

 

Children's

 

593

 

 

649

 

 

1,257

 

 

1,565

 

Footwear

 

389

 

 

473

 

 

959

 

 

1,346

 

Accessories

 

361

 

 

431

 

 

855

 

 

1,245

 

Net Sales

$

3,779

 

$

4,358

 

$

9,152

 

$

12,348

 

 

Unredeemed gift cards and merchandise return card liabilities totaled $272 million as of October 31, 2020, $334 million as of February 1, 2020, and $252 million as of November 2, 2019. Revenue of $127 million was recognized during the current year from the February 1, 2020 ending balance.

3. Debt

Long-term debt consists of the following unsecured senior debt:

 

 

Effective

Rate

Coupon

Rate

Outstanding

Maturity

(Dollars in Millions)

October 31,

2020

February 1,

2020

November 2,

2019

2023

 

3.25

%

 

3.25

%

$

350

 

$

350

 

$

350

 

2023

 

4.78

%