Kohl’s updated its investor presentation highlighting progress on its strategy and initiatives to drive continued momentum. The update follows a second call by activist investors for changes.

In a press release, the highlights of the presentation include:

Well-positioned In A Retail Industry Undergoing Profound Change:

  • Kohl’s strengthened its financial and competitive position during a period of profound change in the retail industry;
  • The retailer’s investments in omnichannel and operations helped it to successfully navigate the pandemic; and
  • Kohl’s continues to strengthen its foundation to differentiate itself and support future growth.

Compelling Strategy To Drive Significant And Sustainable Shareholder Value:

  • Kohl’s introduced a strategic framework in October 2020 focused on creating long-term shareholder value;
  • A strategy focused on driving top-line growth and expanding operating margin from 7 percent to 8 percent;
  • The retailer has made significant progress, with the announcement of key strategic partnerships and recent results exceeding expectations; and
  • Kohl’s partnership with Sephora will drive beauty sales and new customer acquisition in 2021.

Strong, Diverse Board With The Right Skills And Experience:

  • Kohl’s Board will continue to serve as change agents focused on improving performance and creating shareholder value;
  • Kohl’s Board formulated an orderly succession for a new CEO with extensive industry expertise in 2018 and provided oversight for the development of the retailer’s strategic plan and targeted investment in the retailer’s omnichannel and digital capabilities;
  • All 12 of Kohl’s directors have extensive retail or consumer-facing industry experience. Four are current or former retail CEOs
  • Kohl’s current directors have extensive technology, e-commerce and digital leadership experience; and
  • Since 2016, six new directors have joined the Board, five of which are independent, refreshing 50 percent of the Board in the last five years.

Kohl’s Directors Outmatch Activist Investors’ Nominees On Relevant Experience:

  • Four of the nine members of the Activist Investors’ slate have never sat on a public company board, while all of Kohl’s directors are currently on one or more public company boards;
  • Activist Investors’ slate includes only one current or former public company CEO, while Kohl’s Board includes five; and
  • Activist Investors’ slate has overseen significant value destruction, including nine companies that filed for bankruptcy.

Kohl’s also said, “Kohl’s is committed to engaging constructively with all our shareholders. Kohl’s has been responding to inquiries from individual members of the Activist Investors since the spring of 2020. Since December 2020, the company has held multiple meetings with the Activist Investors, including meetings with several independent directors and members of Kohl’s management. Kohl’s is prepared to continue engaging with the Activist Investors on matters which might improve shareholder value but will strongly reject efforts to take control of Kohl’s.”

The investors include Macellum Advisors GP LLC, Ancora Holdings Inc., Legion Partners Asset Management LLC, and 4010 Capital LLC.

Following Kohl’s issuance of fourth-quarter earnings, the investors released a second statement contending that Kohl’s “lackluster fourth-quarter earnings and guidance demonstrate that Kohl’s is content being ‘best of the worst’ in retail.” The group also said its nominees “have the experience and track records to help reverse Kohl’s chronic underperformance and history of failed initiatives and to position Kohl’s for success over the long-term.”

Photo courtesy Kohl’s