Kohl’s (KSS) reported better-than-expected quarterly profit, helped by better control over inventories and warm weather that boosted sales of summer clothes and accessories.
The department store chain’s shares rose almost 8% to $40.26 in premarket trading on Thursday. Shares of rival Macy’s (M), which also reports quarterly results on Thursday, were up 3%.
Shares of department store operators, which are struggling with stiff competition from online and off-price retailers, have been under pressure in the past year.
Hot weather in July, however, increased traffic in malls, helping department stores clear inventory from the previous quarter.
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Sales at Kohl’s stores open at least a year fell 1.8%, down for the second straight quarter. Analysts polled by research firm Consensus Metrix had on average forecast a 1.7% drop.
Kohl’s net income rose to $140 million, or 77 cents per share, in the second quarter ended July 30, from $130 million, or 66 cents per share, a year earlier.
Excluding items, the company earned $1.22 per share.
Net sales fell 2% to $4.18 billion.
Analysts on average had expected earnings of $1.03 per share and revenue of $4.16 billion, according to Thomson Reuters I/B/E/S.
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The company said it now expects adjusted earnings of 3.80-$4.00 per share for the year ending January 2017, down from its previous forecast of $4.05 to $4.25.
