Kohl's Corp., the fourth-largest U.S. department store chain, said Thursday its third quarter profit rose 20 percent, helped by the launch of exclusive brands such as lines by Jennifer Lopez and Marc Anthony.

The Menomonee Falls, Wisconsin-based company posted net income  of $211 million for the quarter ended Oct. 29, or 80 cents per diluted share, compared with $176 million, or 57 cents a share, in the same year-ago period, beating Wall Street estimates by a penny.

Net sales were $4.4 billion, an increase of 3.8 percent over the comparable prior year quarter. Sales at stores open at least a year climbed 2.1 percent.

Revenue was up 3.8 percent to $4.4 billion, from $4.2 billion a year ago, matching analysts' view.

Kohl's gross margin, a measure of the profitability of goods sold, widened slightly to 38.6 percent, from 38.5 percent in the same year-ago period. Rival Macy's reported Wednesday a bigger-than-expected drop in gross margin, shrinking to 39.4 percent from 40 percent a year earlier.

The company's increase in gross margin is a result of its increased penetration of private and exclusive brands and disciplined inventory management, Kevin Mansell, Kohl's CEO said in a statement. He expects a strong holiday season delivered by Kohl's collection of strong brands and significant marketing investments.

Kohl's raised its full-year outlook from $4.34 to $4.49 per diluted share to $4.41 to $4.52 per diluted share.

The company, which caters to middle-class shoppers, opened 40 stores during 2011, including 31 in the third quarter, and now has 1,127 stores in 49 states, compared with 1,089 stores at the same time last year.

Kohl's on Wednesday declared a quarterly cash dividend of 25 cents per share of its common stock. The dividend is payable Dec.28, 2011 to shareholders of record at the close of business on Dec.7, 2011.

Sears Holdings Corp. and J.C. Penney Co. -- the largest and third largest in the industry -- are scheduled to release their third quarter earnings on Nov.17 and No.14, respectively.

Kohl's shares rose 2.23 percent to $55.50 in early afternoon trading. The shares were little changed this year before today, gaining only 0.1 percent.