<SEC-DOCUMENT>0000892712-22-000071.txt : 20220301
<SEC-HEADER>0000892712-22-000071.hdr.sgml : 20220301
<ACCEPTANCE-DATETIME>20220301172135
ACCESSION NUMBER:		0000892712-22-000071
CONFORMED SUBMISSION TYPE:	DEFA14A
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20220301
DATE AS OF CHANGE:		20220301

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			KOHLS Corp
		CENTRAL INDEX KEY:			0000885639
		STANDARD INDUSTRIAL CLASSIFICATION:	RETAIL-DEPARTMENT STORES [5311]
		IRS NUMBER:				391630919
		STATE OF INCORPORATION:			WI
		FISCAL YEAR END:			0129

	FILING VALUES:
		FORM TYPE:		DEFA14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-11084
		FILM NUMBER:		22699804

	BUSINESS ADDRESS:	
		STREET 1:		N56 W17000 RIDGEWOOD DR
		CITY:			MENOMONEE FALLS
		STATE:			WI
		ZIP:			53051
		BUSINESS PHONE:		262 703 7000

	MAIL ADDRESS:	
		STREET 1:		N56 W17000 RIDGEWOOD DR
		CITY:			MENOMONEE FALLS
		STATE:			WI
		ZIP:			53051

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	KOHLS CORPORATION
		DATE OF NAME CHANGE:	19930328
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEFA14A
<SEQUENCE>1
<FILENAME>kss14a301a.htm
<TEXT>
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<TITLE>DEFA14A</TITLE>
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<DIV style=margin-left:36pt;width:553.5pt><P align=center style='font:10pt Times New Roman;margin:0'><A name=_Hlk66189505 />UNITED STATES</P>
<P align=center style='font:10pt Times New Roman;margin:0'>SECURITIES AND EXCHANGE COMMISSION</P>
<P align=center style='font:10pt Times New Roman;margin:0'>Washington, D.C. 20549</P>
<P align=center style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P align=center style='font:10pt Times New Roman;margin:0'>SCHEDULE 14A INFORMATION</P>
<P align=center style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P align=center style='font:10pt Times New Roman;margin:0'>PROXY STATEMENT PURSUANT TO SECTION 14(a)</P>
<P align=center style='font:10pt Times New Roman;margin:0'>OF THE SECURITIES EXCHANGE ACT OF 1934</P>
<P align=center style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P align=center style='font:10pt Times New Roman;margin:0'>(AMENDMENT NO. ____)</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'>Filed by the Registrant [X]</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'>Filed by a Party other than the Registrant [ &nbsp;&nbsp;]</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'>Check the appropriate box:</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'><KBD style='position:absolute;font:10pt Times New Roman;margin-left:0pt'>[ &nbsp;&nbsp;]</KBD><KBD style=margin-left:36pt></KBD>Preliminary Proxy Statement&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'><KBD style='position:absolute;font:10pt Times New Roman;margin-left:0pt'>[ &nbsp;&nbsp;]</KBD><KBD style=margin-left:36pt></KBD>Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'><KBD style='position:absolute;font:10pt Times New Roman;margin-left:0pt'>[ &nbsp;&nbsp;]</KBD><KBD style=margin-left:36pt></KBD>Definitive Proxy Statement&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'><KBD style='position:absolute;font:10pt Times New Roman;margin-left:0pt'>[ &nbsp;&nbsp;]</KBD><KBD style=margin-left:36pt></KBD>Definitive Additional Materials&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'><KBD style='position:absolute;font:10pt Times New Roman;margin-left:0pt'>[X]</KBD><KBD style=margin-left:36pt></KBD>Soliciting Material Pursuant to &#167;240.14a-12&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<TABLE style=border-collapse:collapse><TR><TD valign=top style='width:478.8pt;border-bottom:0.5pt solid #000000'><P align=center style='font:10pt Times New Roman;margin:0'>KOHL&#8217;S CORPORATION</P>
</TD></TR>
<TR><TD valign=top style='width:478.8pt;border-top:0.5pt solid #000000'><P align=center style='font:10pt Times New Roman;margin:0'>(Name of Registrant as Specified In Its Charter)</P>
</TD></TR>
<TR><TD valign=top style='width:478.8pt;border-bottom:0.5pt solid #000000'><P align=center style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style='width:478.8pt;border-top:0.5pt solid #000000'><P align=center style='font:10pt Times New Roman;margin:0'>Name of Person(s) Filing Proxy Statement if other than the Registrant)</P>
</TD></TR>
<TR><TD valign=top style=width:478.8pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
</TABLE>
<P style='font:10pt Times New Roman;margin:0'>Payment of Filing Fee (Check the appropriate box):</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'><KBD style='position:absolute;font:10pt Times New Roman;margin-left:0pt'>[X]</KBD><KBD style=margin-left:36pt></KBD>No fee required.&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'><KBD style='position:absolute;font:10pt Times New Roman;margin-left:0pt'>[ &nbsp;&nbsp;]</KBD><KBD style=margin-left:36pt></KBD>Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<TABLE style=border-collapse:collapse><TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>(1)</P>
</TD><TD valign=top style=width:256.5pt><P style='font:10pt Times New Roman;margin:0'>Title of each class of securities to which transaction applies:</P>
</TD><TD valign=top style='width:158.4pt;border-bottom:0.5pt solid #000000'><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>(2)</P>
</TD><TD valign=top style=width:256.5pt><P style='font:10pt Times New Roman;margin:0'>Aggregate number of securities to which transaction applies:</P>
</TD><TD valign=top style='width:158.4pt;border-top:0.5pt solid #000000;border-bottom:0.5pt solid #000000'><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>(3)</P>
</TD><TD valign=top style=width:256.5pt><P style='font:10pt Times New Roman;margin:0'>Per unit price or other underlying value of transaction </P>
</TD><TD valign=top style='width:158.4pt;border-top:0.5pt solid #000000'><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:256.5pt><P style='font:10pt Times New Roman;margin:0'>&#160;&#160;computed pursuant to Exchange Act Rule 0-11</P>
</TD><TD valign=top style=width:158.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:256.5pt><P style='font:10pt Times New Roman;margin:0'>(Set forth the amount on which the filing fee is calculated </P>
</TD><TD valign=top style=width:158.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:256.5pt><P style='font:10pt Times New Roman;margin:0'>&#160;&#160;and state how it was determined):</P>
</TD><TD valign=top style='width:158.4pt;border-bottom:0.5pt solid #000000'><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>(4)</P>
</TD><TD valign=top style=width:256.5pt><P style='font:10pt Times New Roman;margin:0'>Proposed maximum aggregate of transaction:</P>
</TD><TD valign=top style='width:158.4pt;border-top:0.5pt solid #000000;border-bottom:0.5pt solid #000000'><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>(5)</P>
</TD><TD valign=top style=width:256.5pt><P style='font:10pt Times New Roman;margin:0'>Total fee paid:</P>
</TD><TD valign=top style='width:158.4pt;border-top:0.5pt solid #000000;border-bottom:0.5pt solid #000000'><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:256.5pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style='width:158.4pt;border-top:0.5pt solid #000000'><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
</TABLE>
<P style='font:10pt Times New Roman;margin:0'><KBD style='position:absolute;font:10pt Times New Roman;margin-left:0pt'>[ &nbsp;&nbsp;]</KBD><KBD style=margin-left:36pt></KBD>Fee paid previously with preliminary materials.&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0;margin-left:36pt'><KBD style='position:absolute;font:10pt Times New Roman;margin-left:-36pt'>[ &nbsp;&nbsp;]</KBD>Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. &nbsp;Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.&nbsp;</P>
<P style='font:10pt Times New Roman;margin:0;text-indent:-36pt;margin-left:36pt'>&nbsp;</P>
<TABLE style=border-collapse:collapse><TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>(1)</P>
</TD><TD valign=top style=width:207pt><P style='font:10pt Times New Roman;margin:0'>Amount Previously Paid:</P>
</TD><TD valign=top style='width:207.9pt;border-bottom:0.5pt solid #000000'><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>(2)</P>
</TD><TD valign=top style=width:207pt><P style='font:10pt Times New Roman;margin:0'>Form, Schedule or Registration Statement No.:</P>
</TD><TD valign=top style='width:207.9pt;border-top:0.5pt solid #000000;border-bottom:0.5pt solid #000000'><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>(3)</P>
</TD><TD valign=top style=width:207pt><P style='font:10pt Times New Roman;margin:0'>Filing Party:</P>
</TD><TD valign=top style='width:207.9pt;border-top:0.5pt solid #000000;border-bottom:0.5pt solid #000000'><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:41.4pt><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:22.5pt><P style='font:10pt Times New Roman;margin:0'>(4)</P>
</TD><TD valign=top style=width:207pt><P style='font:10pt Times New Roman;margin:0'>Date Filed:</P>
</TD><TD valign=top style='width:207.9pt;border-top:0.5pt solid #000000;border-bottom:0.5pt solid #000000'><P style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
</TABLE>
<HR style='page-break-after:always;border:0;height:3pt;background-color:#909090;margin:8pt 0'><P style=line-height:0;margin:0></P>
</DIV>
<DIV style=margin-left:72pt;width:468pt><P align=center style='font:11pt Arial;margin:0;color:#222222'><B>THE FOLLOWING IS A COMMUNICATION FROM MICHELLE GASS</B></P>
<P align=center style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt;color:#222222'><B>TO ALL ASSOCIATES ON MARCH 1, 2022</B></P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt;color:#222222'>To: All Associates</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt;color:#222222'>From: Michelle Gass</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt;color:#222222'>Date/Time: March 1 at 9am CT (post earnings call)</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style=color:#222222>Subject line: </FONT>Message from Michelle</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'>&nbsp;</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'>Dear Team,</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'>On our earnings call this morning, we shared our Q4 and year-end results, including the all-time record adjusted earnings of $7.33 per share and the substantial progress we made in 2021 launching several of our key initiatives &#8212;&nbsp;including Sephora at Kohl's. We achieved these results while also managing through the second year of the pandemic and notable headwinds in the global supply chain. This accomplishment is a testament to this incredible team and the work you do every day. </P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'>2021 was a pivotal year and we are in a great position to scale our key strategic initiatives across the company in 2022 and beyond. Given the progress we&#8217;ve made and the opportunities in front of us, we have great confidence in our company and our future.</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'>On the earnings call we also shared a brief update on the Board's efforts to evaluate the expressions of interest in acquiring the company. As I said in my last internal communications about this topic, these expressions of interest in Kohl&#8217;s are a reflection of our strong position and growth potential.</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt;color:#222222'>The Board is continuing to pursue all reasonable opportunities to drive value, consistent with its fiduciary duties. Today, we publicly reiterated that we have a strategic and financial plan that will deliver substantial value. Our Board is testing and measuring that plan against other alternatives. </P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt;color:#222222'>The Board's approach is robust and intentional. As we announced in early February, we retained the investment firm Goldman Sachs to engage with interested parties. Importantly, there are no additional points to share at this time. </P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'>We have great confidence in our strategy and the bright future ahead for Kohl&#8217;s. I thank all of you for your ongoing hard work and dedication, and I look forward to sharing more details with you about our strategic plans ahead in my Town Hall next week.</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'>Sincerely,</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'>Michelle</P>
<HR style='page-break-after:always;border:0;height:3pt;background-color:#909090;margin:8pt 0'><P style=line-height:0;margin:0></P>
<P style='font:11pt Arial;margin:0'>&nbsp;</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style='border-bottom:1px solid #000000'><I>Required SEC Legal Disclosures</I></FONT></P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'><B>Important Shareholder Information and Where You Can Find It</B></P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt'>Kohl&#8217;s intends to file a proxy statement and BLUE proxy card with the SEC in connection with the solicitation of proxies for Kohl&#8217;s 2022 Annual Meeting of Shareholders (the &#8220;Proxy Statement&#8221; and such meeting the &#8220;2022 Annual Meeting&#8221;). Kohl&#8217;s, its directors and certain of its executive officers will be participants in the solicitation of proxies from shareholders in respect of the 2022 Annual Meeting. Information regarding the names of Kohl&#8217;s directors and executive officers and their respective interests in Kohl&#8217;s by security holdings or otherwise is set forth in Kohl&#8217;s proxy statement for the 2021 Annual Meeting of Shareholders, filed with the SEC on March 19, 2021 (the &#8220;2021 Proxy Statement&#8221;) and in Kohl&#8217;s Current Report on Form 8-K, filed with the SEC on April 14, 2021 (together with the 2021 Proxy Statement, the &#8220;2021 Filings&#8221;). To the extent holdings of such participants in Kohl&#8217;s securities have changed since the amounts described in the 2021 Filings or were otherwise not included, such changes or amounts have been reflected on Initial Statements of Beneficial Ownership on Form 3 or Statements of Change in Ownership on Form 4 filed with the SEC or will be filed within the time period specified by Section 16 of the Securities Exchange Act of 1934, as amended, and the regulations thereunder. Additional information is available in Kohl&#8217;s Quarterly Reports on Form 10-Q for the first three quarters of the fiscal year ended January 29, 2022 filed with the SEC on June 3, 2021, September 2, 2021 and December 2, 2021, respectively. Details concerning the nominees of Kohl&#8217;s Board of Directors for election at the 2022 Annual Meeting will be included in the Proxy Statement. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SHAREHOLDERS OF KOHL&#8217;S ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH OR FURNISHED TO THE SEC, INCLUDING KOHL&#8217;S DEFINITIVE PROXY STATEMENT, ANY SUPPLEMENTS THERETO AND THE ACCOMPANYING BLUE PROXY CARD BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and shareholders will be able to obtain a copy of the definitive Proxy Statement and other documents filed by Kohl&#8217;s free of charge from the SEC&#8217;s website, www.sec.gov. Copies will also be available at no charge on the Kohl&#8217;s website at investors.kohls.com.</P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt;color:#222222;background-color:#FFFFFF'><B>Cautionary Statement Regarding Forward-Looking Information</B></P>
<P style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt;color:#222222;background-color:#FFFFFF'>This communication contains &#8220;forward-looking statements&#8221; within the meaning of the Private Securities Litigation Reform Act of 1995. The Company intends forward-looking terminology such as &#8220;believes,&#8221; &#8220;expects,&#8221; &#8220;may,&#8221; &#8220;will,&#8221; &#8220;should,&#8221; &#8220;anticipates,&#8221; &#8220;plans,&#8221; or similar expressions to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, which could cause the Company&#8217;s actual results to differ materially from those anticipated by the forward-looking statements. These risks and uncertainties include, but are not limited to, risks described more fully in Item 1A in the Company&#8217;s Annual Report on Form 10-K, which is expressly incorporated herein by reference, and other factors as may periodically be described in the Company&#8217;s filings with the SEC. Forward-looking statements relate to the date initially made, and Kohl&#8217;s undertakes no obligation to update them.</P>
<HR style='page-break-after:always;border:0;height:3pt;background-color:#909090;margin:8pt 0'><P style=line-height:0;margin:0></P>
<P align=center style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'><B>THE FOLLOWING IS A TRANSCRIPT OF THE COMPANY&#8217;S EARNINGS CALL ON MARCH 1, 2022</B></FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Wire: Bloomberg Transcripts (BT)</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Date: Mar 1 2022 10:13:41</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Kohl's Earnings Q4 2022 Earnings Call Teleconference KSS US</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Event Date: 03/01/2022</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Company Name: Kohl's</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Event Description:Q4 2022 Earnings Call</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Source: Kohl's</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Version: Final</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>For more event information and transcripts,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>visit {KSS US Equity EVT BB-5824821-1 &lt;GO&gt;}</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Q4 2022 Earnings Call</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Presentation</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Operator:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Good day, thank you for standing by and welcome to the Fourth Quarter 2021</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Kohl's Corporation Earnings Conference Call. At this time, all participants</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>are in a listen-only mode. After the speakers' presentation, there will be a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>question-and-answer session. (Operator Instructions). I would now like to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>hand the conference over to one of your speakers today, Mr. Mark Rupe. Sir,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>please go ahead.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Mark Rupe, Vice President, Investor Relations:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you. Certain statements made on this call, including projected</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>financial result and the Company's future initiatives are forward-looking</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>statements within the meaning of the Private Securities Litigation Reform Act</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of 1995. Kohl's intends forward-looking terminology such as believes,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>expects, may, will, should, anticipates, plans, or similar expressions to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>identify forward-looking statements. Such statements are subject to certain</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>risks and uncertainties which could cause Kohl's actual results to differ</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>materially from those projected in such forward-looking statements. Such</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>risks and uncertainties include but are not limited to those that are</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>described in Item 1A in Kohl's most recent Annual Report on Form 10-K and as</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>may be supplemented from time to time in Kohl's other filings with the SEC,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>all of which are expressly incorporated herein by reference. Forward-looking</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>statements relate to the date initially made, and Kohl's undertakes no</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>obligation to update them. In addition, during this call, we will make</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>reference to non-GAAP financial measures including free cash flow.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Information necessary to reconcile these non-GAAP financial measures can be</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>found in the investor presentation filed as an exhibit to our Form 8-K filed</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>with the SEC and is available on the company's Investor Relations website.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Please note that this call will be recorded; however, replays of this call</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>will not be updated. So if you're listening to a replay of this call. It is</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>possible that the information discussed is no longer current and Kohl's</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>undertakes no obligation to update such information. With me today are</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, our Chief Executive Officer and Jill Timm, our Chief Financial</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Officer. I will now turn the call over to Michelle.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you, Mark. Good morning and welcome to Kohl's Fourth Quarter Earnings</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Conference Call. 2021 with a pivotal year for the company. We achieved record</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>earnings per share and successfully launched several key strategic</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>initiatives that position us to drive growth for years to come. I am proud of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>how our team has remained agile and focused in a challenging environment</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>during the past couple of years. We've proven that Kohl's is an incredibly</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>strong and resilient company and has a very bright future. During today's</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>call, I want to leave you with three things.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>First, we have fundamentally restructured our business to be more profitable.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>In 2021, we delivered an all-time record adjusted earnings per share of $7.33</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>eclipsing our previous high of $5.60 in 2018 and our operating margin of 8.6%</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>exceeded our goal of 7% to 8% two years ahead of plan. Second, our strategy</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>is building momentum. Sephora is driving impressive results, which gives us a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>lot of confidence as we extend the partnership to more than half of our store</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>base this year. We are also pleased with the ongoing strength in our active</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>business, which grew more than 40% relative to last year. And third, we are</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>returning a significant amount of capital to shareholders. We continue to see</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>a lot of value in our company and are reinforcing our commitment to driving</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>shareholder value in 2022. The Board has approved a 100% increase in our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>dividend, which equates to an annual dividend of $2 per share. In addition,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the Board has authorized a $3 billion share repurchase program, and we plan</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to repurchase at least $1 billion this year, of which $500 million is</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>expected to be repurchased through open market transactions or an accelerated</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>share repurchase program executed in Q2 2022. In addition, we are focused on</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>running our business the right way. We have a long-standing commitment to ESG</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>stewardship including a strong environmental platform, diversity and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>inclusion strategy, and focus on giving back to communities.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>We continue to raise the bar in all of these areas and look forward to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>releasing our 2021 ESG report in the spring, which will include details on</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our ESG goals, progress to date, and SASB and TCFD reporting. we remain</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>extremely confident and driving profitable future growth and cash flow</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>generation, and we look to build on this past year success in 2022 and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>beyond. I'll start by adding more color to our Q4 results. We drove strong</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>margin improvement and delivered fourth quarter earnings per share ahead of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>expectations. following a strong sales start to the quarter, we experienced</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>significant additional inventory receipt delays and were unable to fulfill</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>all of the customer demand during this critical holiday time.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>We estimate that our sales growth was impacted by approximately 400 basis</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>points as a result of the worsening of supply chain disruption to our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>business. We also experienced a softening in store traffic in January due to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>on Omicron. Our ability to navigate these challenges and still report strong</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>earnings is a testament to how we fundamentally restructured our business to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>be more profitable with an assortment that has a higher margin profile and an</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>expense structure that is more efficient. In terms of the top line, Q4 sales</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>increased 6% to last year, led by a double-digit increase in store sales. We</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>saw the best performance in categories where we had sufficient inventory such</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>as active and conversely weaker results in areas with inventory challenges</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>like women's. This gives us confidence that as we improve our inventory</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>position in 2022, we will be able to better capture customer demand and drive</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>sales growth. Stores remain extremely important to our business. The vast</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>majority of our customers shop our stores and the stores play a central role</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>in our omnichannel model. During the fourth quarter, more than 40% of digital</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>sales were fulfilled by stores. As it relates to digital, sales increased 21%</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>in the same period in 2019 and were down 1% to 2020. As a percentage of total</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>sales, digital sales were 39% in the quarter. For the year relative to 2019,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>digital sales increased 30% and accounted for 32% of total sales.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>From a category perspective in Q4, active continue to be a key growth driver</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of our business with sales increasing more than 25% to both last year and on</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>a two-year basis. Kohl's continues to assert itself as a leading destination</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>for the overall active category, including performance, athleisure, and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>outdoor through its differentiated portfolio of national and private brands.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>We saw strength across all active categories in Q4. Women's, men's, and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>children's apparel as well as in footwear. From a brand perspective, our key</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>active national brands of Nike, Under Armour, Adidas, and Champion all</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>experienced exceptional growth. In addition, our national brands of Levi's,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Vans, Ninja, Koolaburra by UGG, Lego, and Hurley also outperformed. From a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>private brands standpoint, we saw strength in brands like tech gear Sonoma</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and so. Jill will share more color on the quarter in a moment.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Let me now provide an update on our strategy and key 2022 initiatives. We</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>made important progress in our pursuit of becoming a leading destination for</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the active and casual lifestyle in 2021. Part of this strategy is our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>product, building a meaningful beauty business, continuing to grow our active</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>category, improving women's, and introducing iconic relevant brands to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>further differentiate our brand portfolio. Many of these major initiatives</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>were launched late in 2021 and are just starting to scale with most of the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>upside opportunity still ahead of us.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Let me start with our game changing partnership with Sephora. As we've shared</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>before, this introduction will propel Kohl's into a leading beauty</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>destination. It also is a great example of how we are investing in profitable</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>future growth by elevating our product assortment and the overall experience.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sephora drove significant beauty sales in its first holiday season at Kohl's.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>We are continuing to see increased levels of traffic and a mid-single digit</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>sales lift in the first 200 stores that have Sephora as compared to the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>balance of the chain. We continue to see strong new customer acquisition in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our Sephora stores who are younger and more diverse. New customers represent</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>more than 25% of Sephora at Kohl's shoppers. Customers are shopping across a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>wide range of price points and categories such as makeup, skincare, and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>fragrance. Some of the top selling brands during the holiday season included</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sephora Collection, Fenty, Too Faced, Charlotte Tilbury, Olaplex, and Tarte.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sephora Kohl's customers are also shopping across the stores. More than half</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>are attaching at least one other category in their purchase with women's</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>accessories and active being the most prevalent. The frequency of customer</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>return trips is also building the longer the Sephora shops have been open.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sephora will be a key driver of our growth in 2022 with the opening of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>another 400 new shops, reaching half of our store base. And in 2023, we will</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>open another 250 Sephora shops. We are working closely with Sephora to test</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and launch additional opportunities to grow our collective business. We look</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>forward to highlighting some of these at next week's Investor Day. In</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>conjunction with the Sephora openings, we are also investing to elevate the</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>overall store environment. We are repositioning categories to deliver against</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our new strategy such as moving active to the front of the store. We continue</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to improve our merchandising efforts and offer an ongoing pipeline of newness</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and discovery. By the end of 2022, more than half of our store base will have</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sephora in the new elevated experience which is an important milestone in our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>evolution. In addition to moving active to the front of the store, we will be</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>driving growth through further expansion in our assortment and elevated</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>merchandising across all of our key national brands. We're also growing our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>outdoor business. Following the successful launch of Eddie Bauer, we will</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>expand the brand offering from 500 stores to all stores in 2022. We will also</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>increased distribution of Under Armour outdoor from 400 stores to all stores</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and remain committed to growing our business with Columbia and Lands' End,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and we're focused on further growing our plus size and big and tall</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>businesses, which continue to resonate with our customers.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>In addition to the Sephora and active, let me share some of our other key</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>initiatives, starting with men. Our men's business has continued to be a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>strong performer and benefit from our recent brand introductions of Tommy</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Hilfiger, Calvin Klein, and Hurley. We look to build on this momentum in 2022</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>by dedicating more space and expanding each of these brands. Let me now turn</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to women's, which is an important business for Kohl's. As you know, we have</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>taken a number of steps to reposition the women's business. We entered 2021</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>with a conservative plan given the uncertainty of the year ahead and the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>significant transformation of that business. As the macro environment</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>improved, we were challenged to sufficiently replenish our inventory level</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>given the worsening supply chain disruptions. As a result, the core women's</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>business operated with an average inventory down nearly 45% to 2019 during</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the fourth quarter. While 2021 included many challenges, the women's business</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>delivered multi-year highs for sell through, turn, and margin. You'll hear</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>more about our women's strategy at next week's Investor Day. We are also</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>focused on other initiatives across the business. We will inject more</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>discovery into our stores with more frequent use of capital such as Draper</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>James RSVP, a collection from the brand founded by Reese Witherspoon and a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>premium denim offering including Buffalo and Levi SilverTowne. Leveraging the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>reach of our strong omnichannel platform, we will also be introducing dozens</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of emerging products and brands on a rotating basis, Including brands such as</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Colors for Good and Love Your Melon that have a philanthropic mission. Let me</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>now provide a quick preview of what to expect at next week's Investor Day</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>event. We are looking forward to sharing with you how we are evolving Kohl's</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>into a focused lifestyle concept with a clear mandate on driving profitable</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>growth. In addition to Jill and I, several other members of our executive</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>leadership team will join us to discuss key initiatives across merchandising,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>marketing, and technology. We will also review our long-term financial plan</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and highlight our ESG effort. Before I hand it off to Jill, let me briefly</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>summarize my comments today.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>2021 was an important and pivotal year for Kohl's. We accomplished a great</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>deal strategically and financially, as we've highlighted today. Given the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>strong growth initiatives in front of us, we have great confidence in the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>future. We are focused on driving shareholder value and are reinforcing our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>commitment to returning capital to shareholders. We are doubling our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>dividend, and our Board has approved a $3 billion share repurchase</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>authorization with a plan to repurchase at least $1 billion in shares in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>2022. As we close out this important year for the company, I want to express</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>my sincerest gratitude to all of our associates across the country for their</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>tremendous commitment and hard work. It has been an extraordinary couple of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>years, and this team continues to foster a strong culture, deliver</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>exceptional service to our customers, and create a bright future for Kohl's.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>With that, I'll now turn the call over to Jill who will provide more details</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>on our financial results and 2022 guidance.</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you Michelle and good morning everyone. I want to start by reiterating</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the three key takeaways from today's call. One, we have fundamentally</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>restructured our business to be more profitable, and this is showcased by our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>record year of EPS. Two, our strategy is building momentum, and this will</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>continue in 2022 and three, we are reinforcing our commitment to driving</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>shareholder value, doubling our dividend, and planning to repurchase at least</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>$1 billion in shares in 2022. For today's call, I'm going to review our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Fourth Quarter results, discuss our capital allocation plan, and then provide</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>details on our 2022 guidance outlook. For the fourth quarter, net sales</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>increased 6% to last year and other revenue, which is primarily credit</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>revenue, also increased 6%. As Michelle indicated following a strong start to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the quarter, the sales trend worsened due to inventory receipt delays and the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>spread of Omicron. We estimate that our sales were impacted by approximately</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>400 basis points in the fourth quarter, as a result of supply chain</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>challenges. Turning to gross margin, Q4 gross margin was 33.2%, up 124 basis</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>points from last year, driven primarily by higher inventory turn and regular</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>price selling, reduced sourcing cost, and pricing and promotion optimization</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>strategies. This was partially offset by higher transportation costs, as</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>freight expense was more than a 140 basis point headwind to gross margin in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Q4 and with $40 million higher than the expected.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Now let me discuss SG&amp;A. In Q4, SG&amp;A expenses increased 5% to $1.7 billion,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>driven principally by our top line growth. As a percentage of revenue, SG&amp;A</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>expenses leveraged by 15 basis points to last year with improved store labor</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>productivity and more technology expenses more than offsetting increased wage</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>investments across our stores and fulfillment centers. Depreciation expense</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of $207 million was $11 million lower than last year due to lower capital</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>spend. In total, our Q4 operating margin was 6.9% representing an increase of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>172 basis points to last year. Last, let me touch on some additional</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>financial items. Interest expense of $5 million lower than last year due to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>lower average debt outstanding during the quarter based on steps we took in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>2021 to return our balance sheet to its healthy pre-pandemic debt structure.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Net income for the quarter was $299 million and earnings per diluted share</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>was $2.20. This compares with last year's adjusted EPS of $2.22 which</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>included $1.15 of tax benefit. As evident in our performance during 2021, our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>strategic actions over the past 18 months to enhance our gross margin and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>improve the efficiency within our expense structure are working. For the full</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>year, we achieved a gross margin of 38.1% which exceeded our 36% target, and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we have managed expenses tightly, lowering marketing and technology spend</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>each by more than $100 million since 2019. These were key drivers in our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>ability to deliver an operating margin of 8.6% in 2021 exceeding our 2023</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>target of 7% to 8% two years ahead of plan, and we reported an all-time</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>record EPS of $7.33 well ahead of our prior high of $5.60 in 2018.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Turning to the balance sheet. We continue to be in a strong financial</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>position. We ended the quarter with $1.6 billion of cash and cash</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>equivalents. As it relates to inventory, we continue to deliver very strong</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>inventory turnover in Q4, resulting in a 4.1 times turn for the year achieved</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our goal of four times or more. Our inventory balance at year end was 13%</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>lower than 2019; however, this was not reflective of our position during the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>holiday period.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>We entered the quarter with inventory trending down 25% to 2019 and slightly</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>worse than and available for sale basis. And we expected to maintain this</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>level through the holiday. However, a strong start to November coupled with</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>unexpected receipt delays led to significantly less inventory in stores and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>plants during the key shopping weeks. Average available for sale inventory</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>was down nearly 40% to 2019 during November and December and our position in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>stores was even worse than this. In assessing our results, It was clear that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our challenged inventory position hindered our ability to drive the intended</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>sale. We saw a distinct correlation between inventory and sales growth across</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our store base and across our categories.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Our inventory position began improving in January, as receipts began</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>arriving, though was still down approximately 30% on average during the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>month. Looking ahead, we feel good about our overall inventory composition,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>although certain receipts were late, we don't believe we have a margin</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>liability as we will continue to work through inventory in Q1 in core</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>merchandise items like sleep and is pack and hold strategies on seasonal</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>goods such as sleep set and pajamas, and we've taken additional proactive</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>steps to ensure we are better positioned. Turning to cash flow. We continued</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our strong cash flow generation with $497 million of operating cash flow and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>$296 million of free cash flow in Q4. For the full year 2021, we generated</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>operating cash flow of $2.3 billion and free cash flow of $1.6 billion.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Capital expenditures for the year were $605 million, driven mainly by Sephora</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>build out, refreshes and fixtures for new brand launches, as well as the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>completion of our sixth e-commerce fulfillment center. For 2022, we are</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>planning capital expenditures of approximately $850 million. This is higher</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>than 2021 due to our continued investment in enhancing our store experience</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>including 400 Sephora build outs and store refreshes as well as five new</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>stores and four relocations.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Now let me discuss our capital allocation actions. During the fourth quarter,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we further accelerated our share repurchase activity, buying over 10 million</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>shares for $548 million. For the full year, we repurchased 26 million shares</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>for $1.35 billion and ended the year with approximately 131.3 million shares</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>outstanding. As it relates to our dividend, we paid a $147 million to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>shareholders in 2021. In total, we returned $1.5 billion to shareholders in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>2021.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>The Board has approved a 100% increase in our dividend, which equates to an</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>annual dividend of $2 per share and a $3 billion share repurchase</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>authorization. In 2022, we plan on repurchasing at least $1 billion</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>illustrating the confidence we have in our business and our key strategic</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>initiatives. Now let me provide details on our outlook for 2022. As you heard</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>today, we are confident in our strategy to continue to our growth in 2022.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>That said, we acknowledge that there are still a lot of macro environment</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>challenges and uncertainties. Our guidance assumes that our business will</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>strengthen as the year progresses given the timing of our key strategic</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>growth initiatives, specifically, the rollout of our 400 Sephora shops. For</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the full year, we currently expect net sales to increase 2% to 3% versus</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>2021, operating margins to be in the range of 7.2% to 7.5% and EPS to be in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the range of $7 to $7.50, excluding a non-recurring charges. Let me share</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>some additional guidance details and notes. We are expecting higher G&amp;A and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>interest expense in 2022 due to lease accounting, as we have stepped up our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>investment in stores with Sephora and refreshes and has resulted in a number</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of leases being reclassified to finance leases from operating leases.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Accounting treatment for finance leases recognized as expense and G&amp;A and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>interest expense rather than rent expense. As a result, we expect G&amp;A to be</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>approximately $860 million and interest expense of approximately $300 million</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>in 2022 and lastly, we expect a tax rate of approximately 24%. I want to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>highlight some additional guidance items. First, from a net sales</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>perspective, we expect Sephora to be a key driver of our growth in 2022 with</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the opening of another 400 new shops. Given the timing of the Sephora store</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>openings and inventory flow normalizing, we are expecting sales growth to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>build as the year progresses with the second half stronger than the first</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>half. Second, we are expecting significantly higher freight and product cost</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>inflation in 2022. While we will benefit from our ongoing sourcing</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>initiatives and some pricing actions, we do not expect to fully mitigate the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>headwinds. As a result, we are planning gross margin to contract by</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>approximately 100 basis points in 2022 relative to 2021. Third, from an SG&amp;A</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>expense perspective, we are planning expenses to be higher in Q1 and Q2,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>driven by the opening of 400 Sephora stores and the related store refresh</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>cost, and fourth, our guidance assumes our plan to repurchase at least $1</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>billion of shares in 2022 of which $500 million is expected to be repurchased</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>through open market transactions or an accelerated share repurchase program</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>executed in Q2 of 2022. For modeling purposes, please note that we ended 2021</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>with 131.3 million shares.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>In summary, our business remains financially strong. We delivered record EPS</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>in 2021 and returned $1.5 billion in capital to shareholders. We will build</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>on this performance in 2022, as we scale key initiatives and improve our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>inventory position. I will now hand it back to Michelle.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thanks, Jill. Before I move to Q&amp;A, I want to address some of the uninformed</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and an accurate commentary regarding the Board's openness to maximizing</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>value. We have a strategic and financial plan that will deliver substantial</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>value. The Board is testing and measuring that plan against other</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>alternatives. As we announced on February 4, the company retained Goldman</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sachs to engage with interested parties. That effort continues and has</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>included engaging with unsolicited bidders as well as proactive outreach.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Engagement with those parties is ongoing. Our proxy when filed will provide</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>more detail.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>The Board is committed to fulfilling its fiduciary duties and will choose the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>path it believes will maximize the value to shareholders. So contrary to what</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>others might say, the Board's approach is robust and intentional. We won't be</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>commenting further on this topic during today's call.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>With that, we are happy to take your questions at this time.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Questions And Answers</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Operator:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you. (Operator Instructions) Your first question comes from the line of</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Oliver Chen from Cowen. Your line is open.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Oliver Chen, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Hi, thanks for all the details. As we look ahead at your guidance regarding</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>pricing and promotion, particularly as we anniversary some of the stimulus</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>from last year, what are your thoughts on balancing those and how that may</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>interplay with gross margins? And then second, more broadly and your</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>framework for value creation, how are you thinking about real estate and what</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>should we know about different parameters you have there as you do have</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>valuable assets there as well? Thank you.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sure, good morning Oliver. So first in terms of the guidance with the pricing</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and promotion, obviously value always has been a core tenant for Kohl's. And</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>so as we look at pricing, we always want to take a thoughtful and strategic</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>approach to make sure that we're serving our customer best. We do have a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>great pricing elasticity models, so we do leverage that to make our pricing</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>decisions. So for things that are not elastic like the core fashion kids, we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>are going to be a much more sensitive on price versus things that are elastic</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>like small electric toys and basics, so that model works for us. And that's</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>how we'll change those pricing. Remember 65% of our sales are national</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>brands. So they're really the ones who are driving pricing and allows us to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>maintain competitive pricing through the market at that point in time. And</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>then last just given our model of being promotional and kind of high low, I</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>guess there's a lot of flexibility to take price through less promotions in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>terms of what we're on sale ahead. So we are on-site 40% last year, we could</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>be at 35% this year and it affords us the opportunity to take price that way</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>with the customer still seeing a great value in that sale. And then last, as</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>you know we've been initiating a sourcing initiative that has been a key</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>contributor to cost savings, and that's really helping us manage through some</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of these inflationary pressures as well. So based on the margin that we gave</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>in the guidance, we said there's about 100 basis points of pressure, that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>really encompasses the freight, which you'll see really in the first three</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>quarters of the year we start lapping that in Q4, as well as any inflation</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and pricing pressures that we're anticipating for the year. And then from a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>real estate perspective, obviously, we love our stores. They are incredibly</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>healthy. Over 99% of them are cash flow positive. And so we think that they</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>are a key asset for us and we like them this way, I mean they generate a lot</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of cash and there's other ways for us to monetize value out of those stores</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>by continuing to drive sales there by using them for our omnichannel services</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and really servicing our customers at the level of convenience that affords</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>us. There's other ways for us to find I think capital in a more economic way</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>than having to leverage our real estate at this time. But clearly, when we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>needed it which we showed you in 2020 during the pandemic, we leverage some</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of our fulfillment centers to do a sale leaseback and drive that capital</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>because it made the most sense from a financial perspective.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Oliver Chen, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Okay, thank you. And a quick follow-up. The details on receipt delays are</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>very helpful. There is a lot of variables in the macro and geopolitical as</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>well as what's happening in Asia. So what's in your control and what's out of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>your control and what are you monitoring for the receipt delays in terms of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the back half and different risk factors we should be aware of? Thank you.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Yes, thanks, Oliver, Michelle here. So you're absolutely right, I mean there</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>are a lot of headwinds out there and as it relates to supply chain, we're</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>expecting that this is going to persist into this coming year. Yeah, as we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>said in our remarks, that was a bigger headwind in Q4 than we had</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>anticipated. We saw additional inventory receipt delays above and beyond what</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we had expected. That being said, though we sit here today feeling much</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>better about our inventory position going forward. We've taken a number of</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>incremental actions against what we are already doing last year from a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>navigating supply chain standpoint. So for example, as the merchant spot</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>spring. So receipts that are landing today that was happening late last</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>summer and I would say two things there that we did, which is different and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>incremental to the receipts that frankly we were chasing all last year.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Number one, we were more aggressive in our buy, so we've guided the year 2%</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to 3% as you've seen and so we're plan in the year up. And as a result, we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>took our inventory levels in our receipts up and so those decisions were made</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>like I said late last summer. So those receipts are flowing as we speak. And</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>in addition, we're also for the time being, adding a little bit more time to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our timeline just to make sure that we are protected from APO standpoint.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>We've also put in even additional tools. So, we have very tight visibility</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>between the supply chain teams and the merchants to make sure that we can</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>track at a very detailed level, when we're expecting arrivals on receipts.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Like I said, we're expecting this to continue, but I think the totality of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our actions positions us better more medium term, and we've done a lot of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>work on the diversity of our sourcing countries, and we're going to continue</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to do that and balancing cost and speed and what have you and so we have a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>very deep view of that all the while, as Jill mentioned, making sure that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we're taking advantage of cost opportunities in this really volatile</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>environment. But as we sit here right now in the very early days of the year,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our receipts are flowing. Our inventory is up to last year. There are fresh</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>receipts and the customers are responding.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Oliver Chen, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you very much and great job on for best regards.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you Oliver,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you Oliver</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Operator:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Your next question comes from the line of Bob Drbul from Guggenheim Partners.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Your line is open.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Bob Drbul, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Hi, good morning.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Good morning, Bob.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Bob Drbul, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Good morning. Couple of questions from me, on the Sephora piece. I was</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>wondering if you could maybe you give us a few more numbers just around, I</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>don't know, comps of Sephora stores versus non-Sephora stores and know</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>traffic with the stores would have and Sephora, any more color on that. And I</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>guess just a little bit on your assumptions for Sephora driving the comp in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>'22 that would be helpful. And I guess the second question I have is on the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>active piece. Can you just give us an update on your Nike relationship. Have</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>there been any major changes to note or anything along those lines would be</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>helpful. Thank you.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>You bet, Bob. I'll take that one. Michelle here. So first off, as we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>commented in our remarks, we're very excited about Sephora. It's off to a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>fantastic start, 200 doors. To your point on comp or what we look at is we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>look at the lift that those Sephora doors are getting relative to the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>non-Sephora doors and remind you it is only 200 stores and those were</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>launched late last year. So, kind of very early days and I would say is, much</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of the opportunity is ahead of us. I'll get to that relative to the guide,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>but those stores are doing a mid single-digit lift, i.e., comp relative to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the stores that don't have Sephora. So, we're very pleased with that. I think</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>importantly underneath that, we're seeing that comp primarily through traffic</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and we're seeing a healthy base of new customers coming in. So 25% of</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>customers who are coming in shopping Sephora are brand new to Kohl's. So that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>provides a lot of opportunity and we are fostering that. So one of the really</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>unique positive things we have Sephora Kohl's is that those customers sign up</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>for beauty insider and they sign up for Kohl's Rewards. So the benefit to the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>customer on the value there. And secondly, it is a great benefit to the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>collective partnership because of all the data that we get on that customer.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>So really exciting, So then, the second part is, what does that mean to the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>go-forward. While you can do the math on if we have 200 stores that will be</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>in essence not counting this Sephora launch, which by the way, we expect to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>see a runway on this for a couple of years, not unlike when you build a new</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>store, but just for the coming year, you've got those 200 stores that will be</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>not comping their Sephora launch for the majority of the year next year and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>then you have 400 stores coming online, kind of mid to late next year. So the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>combination of those things. Again, if you take a mid single-digit list, you</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>look at the weighted average, you can see it's going to be a significant</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>contributor to the 2% to 3% sales growth, which gives us confidence, Bob,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that we know the world is uncertain, we know there are headwinds, but based</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>on the tailwind of Sephora, the tailwind of getting back in inventory like I</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>was just talking about and the talent of our key initiatives, we feel very</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>good about the sales upside coming forward. And then, your second question on</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>active, which by the way, active continues to play a key role in our sales</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>growth. We've been extremely pleased with the ongoing very strong growth</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>there. And as it relates to Nike, relationship is terrific. We have a great</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>partnership and they are a key part of our kind of next chapter as we talk</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>about our stores and not only opening Sephora, but we're re-flowing the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>entire store putting active front and center at the front of the store, we're</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>expanding the space, we're elevating product and as it relates to just the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>totality of the business with Nike, it's strong across the board men's,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>women's, kids, footwear, the plus size opportunity, big and tall, and those</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>are great growth drivers for us.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Bob Drbul, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Great I wonder if I could just ask a follow-up on the women's business. I</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>guess give some color around some of the hindrance that you had, but just</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>curious as you look at '22 I think, was it the Draper James RSVP collection</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>is that going to be a big driver for you? And I guess just how do you think</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>about women's as you enter '22 and the recovery that you expect there?</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thanks.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Yeah, you bet, Bob. So we've been talking to all of you for over the last 18</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>months that for women's, we undertook a major transformation. This was not</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>incremental move. This was significant exiting a number of brands, putting in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>a lot of new teammates into the group. And then the team made a lot of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>changes. As a result, as we entered into 2021, we had a very conservative</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>plan and so as the recovery started happening broadly, and as we saw the new</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>strategies of women's take hold, the team was unable to chase. And so, just</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to give you a sense in the fourth quarter, women's average inventory was down</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>about 45%. So while we saw great turn and sell through, we just could not</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>fulfill the demand on women's but again there were some green shoots in terms</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of the opportunities we look forward. You mentioned Draper James, and I think</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that's a great example. You can expect more from us on discovery in and out</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>capsules. I think Draper James also for us is an illustration of a category</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that we can really expand and are doing that in the front half of the year,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>which is around dresses and dresses are really trending and Kohl's is going</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to have a much bigger play in dresses this year and the years to come.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Operator:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you. And your next question comes from the line of Gaby Carbone from</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Deutsche Bank. Your line is open.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Gaby Carbone, Analyst:</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Hi, good morning. Thanks for taking my question. I was wondering if you could</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>just dig into what transpired on the top line in 4Q in terms of traffic. You</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>mentioned January soften and any color you can share around quarterly trend</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and your thoughts on the cycle of last years' stimulus payments, and that is</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>maybe bigger picture, your curative view around consumer demand, especially</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>is we're going into budgetary environment? Thank you.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sure, Gaby I can take that one. So, I think as we said in our remarks on the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>fourth quarter, we started the fourth quarter very strong, and we're very</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>encouraged by that and then what happened is as we sold through that product,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we were not able to replenish with the receipts we needed and the receipt</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>flow unexpectedly really flipped and so we were unable to chase what we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>needed to chase from that standpoint. So that was I call the primary issue as</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we got into late November, early December, and then Omicron hit and that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>impacted our business in January and of course through all of that time, we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>were dealing with the inventory headwind even as Omicron came on. That being</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>said, it was really towards the end of January that we started getting in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>receipts. As Jill mentioned, some of that was due to arrive if they think it</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>was received flip was due to arrive in the earlier part of the year. So</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>winter goods, holiday team goods. We can leverage that, put that in pack and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>hold. But importantly, we're now as we sit here today, getting the vast</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>majority of our receipts which are spring-oriented, which is what we want, as</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>I was saying in my earlier remarks, we have bought more assertively, so</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>inventory levels are up and we're encouraged, so the second part of your</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>question is we have to acknowledge right now that there are a lot of macro</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>headwinds out there. There is a lot of uncertainty for the consumer, I think</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we can be confident in our guide of 2% to 3% given we expect Sephora to play</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>a major role and that's proven. We've seen that happen in 200 doors. So, in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>my comment earlier, getting back into inventory and we're encouraged by</FONT></P>
<HR style='page-break-after:always;border:0;height:3pt;background-color:#909090;margin:8pt 0'><P style=line-height:0;margin:0></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>looking at even women's which was most chart from an inventory standpoint is</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>benefiting right now and off to a good start to the year as consumers are</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>reacting to the newness and having the fresh receipts in there. I'd say about</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the quarter, it's early days for us and everything is reflected in our guide,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>in our guide to 2% to 3%. We do expect that to build over the year. So in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>concert with the Sephora rollout, we expect Q1 to be positive. But we do</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>expect sequentially every quarter to build.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Gaby Carbone, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Great. This is a quick follow-up on Sephora. I just wonder if you can give</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>any color around how many new customers you kind of garnered thus far through</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the partnership and maybe how those demographics change versus the typical</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Kohl's customer?</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Yeah, you bet. So as I mentioned earlier, about 25% of the customer shopping</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sephora are brand new to Kohl's. So that is a great opportunity as we look</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>forward. And what's also really exciting is the customers are younger and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>they're more diverse. So all part of our strategic platform going forward.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Gaby Carbone, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Great, thanks so much.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Operator:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>And your next question comes from the line of Mark Altschwager from Baird.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Your line is open.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Mark Altschwager, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Good morning, thanks for taking my question. Just first off, to follow up on</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sephora. How much of the mid-single digit lift is coming from growth in the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>beauty category specifically versus the add-on purchases and now that we're</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>several months past the launch, any learnings you can share regarding the</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>rollout and what strategies you might adjusted you enter the next phase. Just</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>wondering if you think you could maybe build on that mid-single digit in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>round two?</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Yeah, you bet, Mark. I'll take that one too. So in terms of the mid-single</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>digit sales lift, today, we would say primarily that's coming off of beauty,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>but we do expect, as we're bringing these new customers in I mean, it takes a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>while a few trips. So we are seeing by the way that build too, for them to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>get to know Kohl's. So we expect that over time, we will be building baskets.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>We are seeing evidence of that. So half of people who are buying something</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>with Sephora are also putting other things in their basket, but I'd say early</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>days and stay tuned on that front. I think also we're seeing nice lift in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>traffic. So in at mid-single digits, we're seeing that come off the back of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>sales and traffic, which is also really encouraging. And to your second part</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of your question, we see a nice runway with Sephora ahead, I mean part of the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>call it the magic of this partnership and why they were interested in Kohl's</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to begin with is the strength of our omnichannel platform. So our store base,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our digital capabilities, they have an incredibly strong digital capability</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>as well as store base. When you bring those things together how can you</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>innovate and do more interesting things and so we mentioned in our remarks</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that we are looking at new ideas and innovations to build on the partnership,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and we will be talking about that next week at our Investor Day. But suffice</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>it to say, it's the store build out and the comp that we should get on those</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>same stores as we look out a couple of years, but also layering in more ways</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to be relevant with the customer and drive more new customers and traffic.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Mark Altschwager, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you. And a quick follow-up for Jill as well. It's regarding the comp</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>guidance. You mentioned you expect the performance to build through the year,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>but just thinking about 2021 and you are lapping some greater pressure in Q1</FONT></P>
<HR style='page-break-after:always;border:0;height:3pt;background-color:#909090;margin:8pt 0'><P style=line-height:0;margin:0></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>versus what we saw in the middle of the year and it does how much inventory</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>is catching up a bit as we enter 2022, so any more color on why we shouldn't</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>see maybe a stronger start to the year in 2022?</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Yeah, I think in terms of what we're seeing for the two to three comp like</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle mentioned a lot of that is built off of our initiatives, obviously</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sephora shops will start opening in spring and the summer, so we know that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that will continue to drive some momentum. And although the inventory is</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>flowing, it will take time for us to get back to the levels that we feel</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>comfortable with to continue to drive demand as well as the newness. So, we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>did talk about Draper James, it's said, but that is new as well. So we know</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we have to build into our calendar some time for the customer for that to be</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>resonating with them as well. So I think we look at it is we. I know,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>although we're lapping on a two year stack the easiest comp. We also know</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we're lapping some stimulus money. We know that there is still uncertainty in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the world today and we want to be thoughtful of that as we put the guidance</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>out there. So as Michelle mentioned, we do expect to still show growth in Q1,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>but we expect that growth to build as the year progresses and we see our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>strategic initiatives starting to take hold throughout the year.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Mark Altschwager, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Very helpful, thank you. Best of luck.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thanks.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Operator:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Your next question comes from the line of Blake Anderson from Jefferies. Your</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>line is open.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Blake Anderson, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Hi, good morning. I was just wondering if you could discuss broadly how your</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>consumer is responding to inflation? Have you seen any change in behavior new</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>more trade down, specifically you could talk to private label in response to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>any pricing actions you've taken or maybe demand in more discretionary areas</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>just any high level commentary would be appreciated.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Yeah. So I'll take that one, Michelle here, so Jill made a few comments on</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>this earlier as well. I mean we're saying clearly very present to any impact</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that inflation may have to our customer whether that's a Kohl's pressures are</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>feeling outside. I can go back to one of the core value elements or tenants</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of Kohl's is value, and we have a lot of flexibility in our model in terms of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>how we price because we do use promotion, we do use incentive that kind of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>thing, so, and what the team has been able to kind of engineer over the last</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>couple of years is being able to be very agile and responsive where we need</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to. That being said, I'd say, first of all, one of our advantages here is our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>brand portfolio as you just alluded to, that we have a really robust range</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>from your aspirational brands like even if you take the active category. You</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>do have this aspirational brands like a Nike and Under Armour, Adidas et</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>cetera. But then we also offer the opening price point of a tech gear or even</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>flex that has come and we recently launched. So not only do we have the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>flexibility on how we price, but for our customer standpoint, they can walk</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>in and see this great range. I think it's also worth noting that more than</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>60% of our business is national brands and they set the pricing. So from a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>competitive standpoint, we will be there with everybody else. One of the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>things we've actually seen over the last couple of years is our average unit</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>retails increase and that's been more around customers pricing up and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>responding to the elevated brands that we brought in, the inventory</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>management, the less clearance reducing promotions that kind of thing. So</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>evidence today, we feel well positioned, but there's a lot of volatility in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the world. And so we are just staying very close and we'll make needed</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>adjustments to make sure that we are staying relevant with the customer.</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Blake Anderson, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>That's super helpful. Thank you very much. And then last question would be,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>you've talked about inventory I think in a few different categories. Could</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>you talk about your ability to secure Sephora specific inventory. How is that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>progressing and have you seen any challenges there? And then maybe building</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>off the last question, any inflation commentary you can provide on the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sephora shops? Thanks so much.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sure. I think from a Sephora perspective, we have seen inventory flow really</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>well. We've gotten ahead of that. In fact, some of the inventory increase</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that you saw at the end of January, we mentioned January on average inventory</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>was down about 30%. But obviously, the year only down 13%, we took a lot of</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>receipts and at the end of the month and a lot of that was for Sephora being</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>ready for these shops to start opening in spring as well. So we feel well</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>positioned in terms of our inventory for Sephora, to continue to drive sales.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>In terms of inflation, I wouldn't say we've seen a lot of that specific to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sephora or the shops. The good news is, a lot of the construction materials</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we sourced early given the supply chain disruptions. So we weren't at risk</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>for some of these commodity inflation place and I think right now it's</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>managing the labor side of the business as we open new shops and have them</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>constructed, but so within our guide of $850 million for the year and we feel</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>well positioned as we open them and feel very confident with the return</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>you're going to see off of that investment this year and moving forward.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Blake Anderson, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Got it. Thanks again.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Operator:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you and your next question comes from the line of Chuck Grom from</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Gordon Haskett. Your line is open.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Chuck Grom, Analyst:</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Hey, thanks, good morning. Jill, only 100 basis points of get back on the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>gross margin in the shares is a good sign and better than expected. Just</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>wondering if you can sort of put some of the puts and takes out there for us,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>how you're thinking about it and also tie in your expectations for the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>promotional environment, are you expecting to get back to normal? How are you</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>thinking about that?</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sure. I think from a 100 basis points, will say freight is a portion of that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the majority of it though is really going to be around commodity inflation.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>We will see freight and that will hit us in the first three quarters and then</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we'll start lapping some of those costs that we incurred in Q4 of this year.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>I would say the pricing inflation is much more back half loaded because as</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle mentioned earlier, we started writing our receipts for spring early</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and that afford us the opportunity to get those receipts written in before</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the commodity price increases took action. You're going to see a lot of that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>commodity price headwind in the back half of the year starting in Q3 and Q4.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>And then in terms of flexibility for promotional activity, I think it is a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>core to who we are, we've talked a lot about that we're high low. We use a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>lot of couponing we know when to lean in and not we've only gotten better at</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that through all of the data analytics that we've done through our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>personalization efforts. So I think it's something that will be utilized to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>drive behavior. But I still think, even though we're buying more inventory,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we are still incredibly committed to the disciplined inventory of driving</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>term. So you are going to see us getting over our skis re-correcting from an</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>inventory perspective, obviously this year wasn't where we wanted it to be,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>specifically women more so in our private brands being down and really</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>driving that 400 basis points of headwind sales. But as we move forward, we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>feel like will flow into the good drive sales but still be disciplined in</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>turn. And then we will use our promotional activity to help us with pricing</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>and take pricing where we can and then leverage those offers to drive</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>behavior because we know consumer likes a great deal. And we just know better</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>what drives those people into our stores, so you and I may not get the same</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>coupons and I think that's where we're going to be better than we have been</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>in the past.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Chuck Grom, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Okay, fair enough. And then women's it's I think about a 4 point 0 hit to the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>fourth quarter I guess is that the expectation that women's continue to be a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>drag in the first couple of quarters. I'm just trying to connect the dots on</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>inventory levels being where they are versus the expectation for women's to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>start to improve. Maybe, a little bit of color on that. And then I guess a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>follow-up on inventory would be, how much of your inventory is packaway now</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>versus, say, the past couple of years or historically speaking?</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>So I just want to clarify women's was not the full 400 point drag, and we use</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that as our example because it was kind of one of those extremes being down</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>at 45% on inventory, but there were other areas of the business says soft</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>home, has a lot of private label exposure, so that had some headwinds, men's</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>as well. Obviously, it was an apparel perspective had some headwinds. We use</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>women's as the anecdote, but it was not fully the 400 points. Contrary to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that, we do want to talk about active being up 25%. Their inventory was down</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>on average only about 10%. So that's kind of where you can see where we had</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the inventory, we're able to chase the sales, but not that we had to have</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>more inventory from that perspective. In terms of the pack and hold, it has</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>not been a muscle that we use. I think the pandemic allowed us to learn how</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to use that muscle, so we've started using it back in 2020 and we continue to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>use that where we needed to and 2021 obviously pushing that forward In 2022.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>It is small, it is not a huge portion of the amount of inventory that we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>have, I mean it's very small In terms of what it is; however, it allows us to</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>hold the inventory, not take the markdown and preserve the margin, and quite</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>honestly, Chuck, in this year, I get to preserve the margin and I don't have</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the commodity inflation in the back half and will reset some of these, so it</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>works both on top line and on the margin side this year, but it is not</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>something that we typically have done, but it is something that we can</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>utilize in these years that are unique, but again very small.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Chuck Grom, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Okay, great. Thank you. Jill</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Operator:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>And your next question comes from the line of Omar Saad from Evercore. Your</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>line is open.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Omar Saad, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Good morning, thanks for taking my question. Very helpful information. I want</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to just follow up a little bit on the gross margin question. I think Jill you</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>kind of hinted that you're expecting, I make sure I interpreted, but you gave</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>the example of 35 offers, 40 off. Are you expecting promotions to be down</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>year-over-year this year? Is that your underlying assumption given all the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>data analytics and personalization you have and also what's your competitive</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>kind of assumptions around the competitive landscape on the margin line as</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>well? And then I have one quick followup.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sure. I think the example I was m trying to give is we use couponing</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>obviously, but we also use just pricing and promotions every day in our</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>stores. So instead of having to take adjustments on what people see for</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>ticket, we can say inside of 40% off, 30% off and help us really offset some</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of those cost headwinds. Again, we use a pricing elasticity model, so we're</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>going to do is in a really thoughtful manner and understand where the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>customer wants to see value. Clearly our opening price points might be</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>someplace that we leave because they already have great value and other</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>places, we're able to take a little more ticket given what people are willing</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to buy for those products. So I use this as an example of a different tool</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that we may have, because we are not an everyday low price competitor from</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that perspective. In terms of promotional environment, obviously we have</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>talked about simplified pricing and promotions is one of our core strategies</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>when we rolled out our strategy back in October. We continue to leverage that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>really using the couponing in a more targeted manner versus making it just</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>general scale for everyone. Clearly, we'll still have those general public</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>offers. But really trying to drive more targeted behavior through</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>personalized offers is how you're going to see us move forward. So customers</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>may not see it as less promotional, so just be as more meaning promotions to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>drive their behavior coming into the store. I would also say, we will see a</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>tad less stackable offers. That's something that we've been doing. We know</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>our new customers buying confusion when they have to do a lot of math on</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>multiple offers. So really just standing for one big offer to drive that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>behavior because we weren't seeing those other stackable offers really drive</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>meaningful sales behavior and we are taking some margin pressure from that.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>So I think we'll continue to lean into that strategy as we move forward, but</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>obviously always evaluating the competitive landscape, because we are known</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>for value and we want to make sure we continue to compete on that core</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>strategy for Kohl's.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Omar Saad, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Great, thanks. And then one quick follow-up, I know it's really early, but</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>are you seeing any impact in your business from Ukraine, Russia, it is the</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>average American kind of Kohl's shopper paying attention is even if it's just</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>a CNN effect and it's going to go into the TVs or is it too early to tell?</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Yeah. Omar, I mean agreed and then I think we're prepared that is going to be</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>an environment of a lot of uncertainty and so as we message, we certainly</FONT></P>
<HR style='page-break-after:always;border:0;height:3pt;background-color:#909090;margin:8pt 0'><P style=line-height:0;margin:0></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>contemplated that as we guided the year, but I think more importantly for</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Kohl's, we feel like we've just got a ton of tailwinds with our initiatives</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>starting with Sephora and active, the new brands, getting back in inventory,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>so like everyone we'll stay close. We'll be responsive but we'll prepare for</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>kind of another period of time with pressure and uncertainty on the consumer.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Omar Saad, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thanks. Good luck for the year.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Operator:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>And your next question comes from the line of Dana Telsey from Telsey</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Advisory Group. Your line is open.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Dana Telsey, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Good morning, everyone. As you mentioned in the remarks about lower sourcing</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>costs, what are you seeing, how much of it is temporary, how much of it is</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>long term and what do you, are you in the middle of lowering -- lower</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>sourcing costs or how much lower could it go? And then just on the inflation</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>question, what are you taking in terms of price increases and does it vary by</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>category and you're seeing it the national brands as well as your own brands?</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>I can take the pricing on Dana, and then I'll have Jill speak to our sourcing</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>strategy. So as it relates to pricing, overall will speak to, Jill speak to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>some of the mitigation strategy we have underway around our sourcing</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>initiatives. We saw that benefit play out this year. We're expecting more</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>benefit again next year to mitigate some of the other pressures we face. But</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>as ever so to earlier it's really important for us to continue to offer great</FONT></P>
<HR style='page-break-after:always;border:0;height:3pt;background-color:#909090;margin:8pt 0'><P style=line-height:0;margin:0></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>value to the consumer. I think one of our advantages in an environment like</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>that is that we have got a phenomenal brand and category portfolio. So</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>everything from your more aspirational brands products to your opening price</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>points, if you take denim, as an example, which is a trending category. We</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>have a very big denim business. We have Levi's on one end and we've got</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Sonoma jeans on the other, and which is also great quality. So just making</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>sure we can meet the customer where they are. As it relates national brands,</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>there are certain national brands that are taking pricing. We like others</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>will be in a competitive same competitive environment as they take price. We</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>will of course be taking out along with them, but we'll see growth close to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>it. And again, of course we've got other options for the consumer for those</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>who are feeling that pressure and then to your point, are there variances</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>across the business? Absolutely. And I think we're much better positioned</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>today, given the investments that we've made in tools and technology. So we</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>have a very robust US city model that not only looks at our pricing and</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>behavior, but relative to competition, and so there are categories that are</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>more elastic like your basics where the consumers are going to give you a lot</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>of permission to take price, but then you have other categories that are less</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>elastic things that are more seasonal or fashion where we can make sure that</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>we're being thoughtful. But I think that's the key operative word is being</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>thoughtful, being agile and making sure that we are making the right moves</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>for the consumer in this process and then Jill, do you want to speak to</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>sourcing</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Jill Timm, Chief Financial Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Yes, for sourcing, I think last year we had talked about this when we rolled</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>out our strategy and we said it would start in 2021 and it will continue into</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>2022. So we'll start seeing a lot of those efforts. Those were around</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>centralized sourcing doing direct factory negotiation, reducing our reliance</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>on third-party agents, and also really continuing to evolve that sourcing</FONT></P>
<HR style='page-break-after:always;border:0;height:3pt;background-color:#909090;margin:8pt 0'><P style=line-height:0;margin:0></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>strategy, seeking for more production in the Western Hemisphere, which</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle mentioned earlier helps us balance speed with costs. So I would tell</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>you that we are definitely, I think in the middle innings of that ever, but</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>there is more for us to continue to get, which will help us I think as we try</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>to mitigate some of these bigger inflationary cost as we move forward into</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>2022 like I mentioned a lot of that will be back-half loaded for us.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Dana Telsey, Analyst:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Michelle Gass, Chief Executive Officer:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>All right. Well, thanks to everyone listening on the call today. We hope you</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>can join us on Monday for our Investor Day</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Operator:</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you, ladies and gentlemen, this concludes today's conference call.</FONT></P>
<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>Thank you for participating, you may now disconnect.</FONT></P>
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<P style='font:11pt Calibri;margin-top:0pt;margin-bottom:8pt'><FONT style='font-family:Times New Roman'>################################ END OF STORY 1 ##############################</FONT></P>
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<P align=center style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><B>THE FOLLOWING IS A TRANSCRIPT FROM AN INTERVIEW WITH CNBC ON MARCH 1, 2022</B></P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style='color:#0000FF;border-bottom:1px solid #0000FF'>CNBC: The Exchange</FONT> 1:25 PM </P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style=background-color:#FFFFFF>Courtney Reagan: Joining us now is michelle gass. &gt;&gt; thank you for joining us here today. a big day for your company when you're talking about earnings but also when you're looking forward to the year ahead. i want to start sort of with your strategy going forward. particularly as there have been discussions as your company has admitted about potential buyouts, potential takeovers, the board discussion you've turned it down offers for $64 or share saying it didn't value the company enough but how would you explain that to shareholders when shares are trading just below $56 a share now. why is your strategy going forward better than a sale at those offers </FONT></P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style=background-color:#FFFFFF>Michelle: Great to see you again, Courtney first off, let me say the results we reported today we're proud of 2021 was a fickle year for the company. one of the key objectives to restructure this company more profitable growth and on the profitability side, the team has made tremendous progress we delivered record earning $7.33 against what was the all-time high a couple of years ago in 2018. i think importantly our confidence and conviction in strategy, as you mentioned, is our capital allocations strategy doubling our dividends at $3 billion share buy back program, and a billion dollars this year. and i think importantly, we are now set up for profitable growth we have initiatives we've never had before so as we look ahead, Sephora the new brand and the like and, you know, as it relates to the offerings you mentioned. first, let me say the board is deeply involved in there and takes its fiduciary responsibility very responsibly. we start with a plan we mentioned we see a lot of upside value and return to shareholders the board is testing and manufacturing other paths up against this plan. we're highly engaged in terms of bids coming in pro active outreach let me say the thoughtful approach i'll end where i started, which we have great convention in the strategy we put out the capital allocation we'll return back to shareholders. </FONT></P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style=background-color:#FFFFFF>Courtney: You mentioned that. obviously, increasing the dividend you're doing the buy back program. have you had discussions with your biggest shareholders about the board's you put up compared to the activists put up? do you believe that shareholders are sticking with kohls' vision?</FONT></P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style=background-color:#FFFFFF>Michelle: Well, what i would say is i talked to our shareholders all the time we have a lot of their support they like our capital return allocations strategy, believe in our strategies ahead, and as it relates to the board, i mean, what i can tell you is we have an incredible board. it's refreshed we run on six new members just in the last three years with diverse experiences. we have great balance in the 10-year and the new board members coming in. three of those six actually came through the settlement with the activists last year. so i think this board is incredibly well equipped to guide the strategy of the company going forward. </FONT></P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style=background-color:#FFFFFF>Courtney: Michelle, your inventory you mentioned on the call didn't come in as planned largely due to what was going on on the supply chain and the disruption they're in. particularly affecting the women's category which is very important to you you believe once it normalizes, you can better capture the demand again how do you ensure that customer will come back they weren't disappointed in looking for something that wasn't available in the most recent quarter. </FONT></P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style=background-color:#FFFFFF>Michelle: Yeah. so, i mean, it's important question we serve $65 million customers we have a great loyal customer base and we have been navigating this supply chain, like many, for across the entire year and in q4 in particular. we did have more unexpected receipts during the holiday season they came in a little too late and our private brand that was what was most affected including businesses like womens we have done a lot of course correcting the team got after it last fall in terms of our spring receipts those are flowing in we're more bullish on the year we guided 2 to 3%. as you can imagine, the merchants are buying lots of inventory and continue to maintain the great disciplines the women's finance, in particular, it's early days in the year we did share that we expect a full year to be positive 2 to 3% overall. that will likely build as our sephora shops are built occupy the early signs are promising. we're at the early stages </FONT></P>
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<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style=background-color:#FFFFFF>but lots of fresh receipts and looking forward to a strong year for the company overall and all of our businesses. </FONT></P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style=background-color:#FFFFFF>Courtney: Before we let you go, michelle, can you give us a glimpse into how Kohl&#8217;s is dealing with inflation going forward. what your expectations are and what customers should expect to pay, frankly, that they come into the stores and shop join loop if. </FONT></P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style=background-color:#FFFFFF>Michelle: Online i think everybody is impacted by the pressures today. i would be remiss to say there's a lot of things to be unsettled about. our hearts and thoughts go out to people impacted around the world and in ukraine so that is something deeply concerning for all of us as it relates to your question on inflation, i mean, this was something we're dealing with before it's probably only going to get worse. in terms of kohls, inflationary pressures are contemplated in our guide. i'll first start on the margin side the team has done a lot to mitigate those pressures with have a solid pricing promotion strategy we've been working on the sourcing that's in our guide from margin standpoint then as it relates to kohls stands for value i think one of the points that differentiates kohls is we have a broad portfolio. we have aspirational national brands and we've got the entry price point private brands if you take denim, which is a trending category now, we offer levis and sonoma jeans national brands price their goods to be competitive and we have strong models to make sure we're relevant to the consumer it always starts and ends with the consumer and i think with the team has demonstrated is, you know, in every moving environment we can be agile and responsive. </FONT></P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style=background-color:#FFFFFF>Courtney: There's certainly are a lot of moving parts in today's market and in the retail business michelle gass, we appreciate you joining us here today. ceo of kohls leave it there and back to kelly. it's a busy day in the markets.</FONT></P>
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<P align=center style='font:11pt Arial;margin-top:0pt;margin-bottom:8pt;color:#222222;background-color:#FFFFFF'><B>THE FOLLOWING IS A TRANSCRIPT FROM AN INTERVIEW WITH BLOOMBERG ON MARCH 1, 2022</B></P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style='color:#0000FF;border-bottom:1px solid #0000FF'>Bloomberg Markets: The Close 2:33 PM</FONT> </P>
<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF>we have quarterly results from&#160;</FONT><FONT style=color:#1F2D3D;background-color:#FFFFFF><B>Kohl&#8217;s</B></FONT><FONT style=background-color:#FFFFFF>. they are reporting better. the Jefferies analyst which we had on this program a few times he a lot about the increase in the dividend, the buyback and the upside ceiling the confidence in the future cash flow. hoping that the margin upside will continue. </FONT></P>
<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF><B>Caroline Hyde:</B> confidence in the financial targets, we go on from that great set up. thank you for spending some time with us. you have an uncertain distance that involves the consumer. how are you so confident? </FONT></P>
<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF><B>Michelle Gass</B>: and it has been an important day for&#160;</FONT><FONT style=color:#1F2D3D;background-color:#FFFFFF><B>kohls</B></FONT><FONT style=background-color:#FFFFFF>. 2021 was a pivotal year for us. we delivered record results and earnings. far surpassing what was our height back in 2018. importantly, we have been working to restructure this business for greater profitability and drive future growth. we have brought in not only restructuring for the margin side of things, but setting ourselves up for great growth going forward. we introduced our most trust formation of partnership in Sephora -- are most revolutionary partnership in Sephora. are active business has been strong -- our active business has been strong. when you add all of those things up, what positioned us to grow is to do that profitably. I believe the best day for&#160;</FONT><FONT style=color:#1F2D3D;background-color:#FFFFFF><B>kohls</B></FONT><FONT style=background-color:#FFFFFF>&#160;is ahead of us. </FONT></P>
<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF><B>R</B><B>omaine</B><B> Bostick</B>: talk about the inventory situation, you said that there was some inventory issues. are you getting some trouble -- are you having trouble getting inventory?</FONT></P>
<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF><B>Michelle Gass</B> something that we navigated all of last year and it or in the fourth quarter. it cost us around 400 basis points based on our analysis. that was across the board, but in our private brands in categories like women's and men's apparel. we had a stronger inventory in active and we had tremendous sales up 20% on a two year basis. we have done a lot of course correcting on this. if you are navigating supply chains, we were doing the best that we could. we have long lead times. we made sure to get in front of it. we have to have the merchandise to support that. we added a bit more time to our lead time on top of what we had done for last year and we had a more ambitious plan. the merchants are buying more goods. our inventory is up and our confidence is reflecting that positive growth. </FONT></P>
<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF><B>T</B><B>aylor</B><B> Riggs</B><B>:</B> what did you tell activist investors who say that the transformation is clear in margins and the bottom line for not showing up in that top line? </FONT></P>
<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF><B>Michelle Gass</B> look at the health of our business. look at the restructure of the business, the whole thing has to be healthy and the team has done phenomenal work. the question around navigating during the sum certain times, I think the results we have put up for the year demonstrates that this can be agile and deliver even in uncertain times. we are in a position for growth, we did a lot to do the fundamental restructuring of the business. we brought new brands in, has relevancy of&#160;</FONT><FONT style=color:#1F2D3D;background-color:#FFFFFF><B>kohls</B></FONT><FONT style=background-color:#FFFFFF>&#160;to bring in these partners, Sephora is a game changer for us. </FONT></P>
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<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF>the other brands, the active category and when you add all of that up, we have a lot of tailwind going into this year. some exciting initiatives we will be sharing next week. </FONT></P>
<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF><B>Caroline</B><B> Hyde</B>: you set incredibly optimistic and of the view that the best is yet to come -- sound incredibly optimistic and of the view that the best is yet to come, activists are in focus. you have Goldman Sachs entertaining these offers, what you think works best for the investor base? Macy&#8217;s looking at spinning off its digital part of the business and they decided to keep it whole. what do you think would suit you the best in terms of offers? </FONT></P>
<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF><B>Michelle Gass</B> I would start with the board's responsibility and the fiduciary obligation we have to evaluate all past board -- paths forward. we have a lot of confidence in the path ahead. we have seen a significant capital return to our shareholders. we must do our diligence. we are pressure testing alternatives that have come forward. we have bids and we are being proactive to make sure that we are looking at all of our alternatives. I think it is important for the board to look at all ideas and have a robust process. we will make the best decision for shareholders. </FONT></P>
<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF><B>R</B><B>omaine</B><B> Bostick</B><B>:</B> when we talk about getting investors off your back, it comes back to the underlying fundamentals of the business. any sort of earnings you cannot post here above what the street expects. the kindness we got seems to satisfy some investors. people are wondering why that is so higher above appears in your space. what makes you think that&#160;</FONT><FONT style=color:#1F2D3D;background-color:#FFFFFF><B>kohls</B></FONT><FONT style=background-color:#FFFFFF>&#160;can outperform those companies? </FONT></P>
<P style='font:10.5pt Open Sans;margin-top:0pt;margin-bottom:8pt;color:#475669'><FONT style=background-color:#FFFFFF><B>Michelle Gass</B> it goes back to the initiative that we have in front of us. Sephora, we were only in 200 stores. we are building another 400 this year. in the Sephora stores, you get a single digit sales list for the entire store versus those who do not have Sephora. when you do the math on Sephora alone, being launched across the chain will be more than half our chains. there will get to know&#160;</FONT><FONT style=color:#1F2D3D;background-color:#FFFFFF><B>kohls</B></FONT><FONT style=background-color:#FFFFFF>&#160;-- they will get to know&#160;</FONT><FONT style=color:#1F2D3D;background-color:#FFFFFF><B>kohls</B></FONT><FONT style=background-color:#FFFFFF>&#160;and buy into our brand. we feel confident that 2%-3% welcome back. romaine: would you want with another company in regards to in-store? </FONT></P>
<P style='font:10pt Arial;margin-top:0pt;margin-bottom:8pt'><FONT style='font:10.5pt Open Sans;color:#475669;background-color:#FFFFFF'><B>Michelle Gass</B> one thing about&#160;</FONT><FONT style='font:10.5pt Open Sans;color:#1F2D3D;background-color:#FFFFFF'><B>kohls</B></FONT><FONT style='font:10.5pt Open Sans;color:#475669;background-color:#FFFFFF'>&#160;is that we have a unbelievable platform. we have 1200 a source across the country, we have a very strong digital business and we leverage on these channels. all of that is really attractive to partners. we have built momentous brand partners and we are a top retailer of some of the most coveted rants like Levi&#8217;s -- brands like Levi&#8217;s. Sephora, they saw the potential. we continue to work on a pipeline of whether it is product or services, amazon is another great example. we are really convenient for people to bring their returns in. we are bring in hundreds of new customers through that. We are a very healthy company, we generate a lot of cash. As you&#8217;ve seen this year we are investing in capital to build out the Sephora stores and returning it to shareholders as well. </FONT></P>
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