In Neiman’s fiscal year, net earnings reached $163.7 million, versus $140.1 million in fiscal 2012. Comparable revenues increased 4.9 percent, while total revenues rose to $4.65 billion from $4.35 billion in the prior year. Neiman’s revenues have been built back up to right around pre-recession levels.
In other figures, the group’s brick-and-mortar operations generated $862.3 million in sales last quarter and $3.62 billion in sales for the year. The online business generated $256.8 million last quarter and $1.03 billion in sales for the year.
The stores generated $45.2 million in operating income in the quarter and $411.4 million for the year. Online accounted for $32.9 million and $157.7 million in operating income for the quarter and year, respectively.
Overall operating earnings for fiscal 2013 reached $446.4 million compared to $403.6 million for fiscal 2012. With wind at its back and management no longer distracted by the strain of the sale process, the Neiman’s team can return to fully focusing on growth strategies. In addition, some analysts believe the luxury market will gain steam as the economy improves. As a result of the deal, the luxury retailer has changed its name slightly from Neiman Marcus Inc. to Neiman Marcus Group Ltd.
The company did not have its usual conference call to discuss the business and its performance due to the pending transaction. But market sources pegged the strong results on tightened expenses and good inventory management. “They were lean and mean going into its filing last June for an initial public offering,” said one retail source. The IPO won’t happen now that Ares and the Canada fund have agreed to purchase the company from TPG and Warburg Pincus.
It is also believed that to further reduce expenses and show greater profitability, Neiman’s didn’t fill as many vacant jobs as it normally would have, and bought inventory more wisely for spring, leaving less merchandise to clear out. The apparel business, particularly women’s, has been tough in the last few years, and that is said to have affected Neiman’s buy. For 2013, Neiman’s capital expenditure and interest expense were slightly less than the year before.
The change in ownership raises questions about Neiman’s future strategies. The new owners have already said that priorities involve investing in the stores as well as technology, and Karen Katz, Neiman’s chief executive officer since October 2009, backed that up by saying they were keen on investing in long-term growth strategies. Neiman’s previously set $135 million in capital expenditures for 2013, largely for renovating the Michigan Avenue store in Chicago, as well as renovations at Bergdorf Goodman and a few other Neiman’s locations.
Since taking the reins, Katz has demonstrated a willingness to test new waters, in technology, service and other fronts. Last week she cited the possibility of opening more Last Call outlets. Neiman’s has 35 outlets, though its most direct competitors, Saks Inc. and Nordstrom, both operate many more outlets.
Katz has been driving the contemporary fashion side of the business, having recast the category into Cusp in-store departments throughout the full-line luxury chain and just now beginning to spend on marketing Cusp to customers. Cusp has six freestanding stores, yet the company has been reluctant to open additional Cusp freestanding units.
International expansion needs to be explored since with 41 full-line Neiman’s stores across the country, as well as having two Bergdorf Goodman stores in Manhattan, virtually all domestic store-growth opportunities have been tapped. However, a store in the Roosevelt Field mall in Garden City, N.Y., is planned. Most Neiman’s stores are highly productive and deliver strong service but not all. The Orlando, Fla., and Natick, Mass., units are said to be among the weaker locations.
While no overseas stores are in the works, Neiman’s does conduct business online in China, and has invested $38 million in Glamour Sales Holdings, an Asian-based e-commerce site specializing in flash sales, representing a 44 percent stake. Glamour helped Neiman’s launch neimanmarcus.com.cn and is helping migrate shoppers to the Neiman’s site. In addition to products, the site features editorial content, fashion expertise and behind-the-scenes videos about luxury brands. Neiman’s also ships products to other countries, though the retailer hit some road bumps in China and decided to downsize the China team and ship from its U.S. inventories rather than holding inventory in Chinese warehouses. Neiman’s continues to have personnel in China involved in customer care, marketing and Web merchandising in Shanghai.
While some analysts believe Neiman’s has an international reputation, others have said that Saks, due to its Fifth Avenue flagship drawing shoppers from all over the world, has greater overseas potential.
On the technology front, Katz has outfitted sales associates with smartphones to provide better service to customers. The mobile communication enables associates to quickly and easily communicate events, promotions and new merchandise in the stores.
@margotrobbie steps out onto the red carpet wearing @miumiu. The actress is nominated for “Outstanding Performance by a Female Actor in a Leading Role” in “I, Tonya” at the #SagAwards. (📷: Stewart Cook) #wwdfashion
For @massimogiorgetti of @msgm, the Nineties are his favorite decade. “They had a huge impact on my personal growth. What I like of the Nineties is that they are not so precise in terms of style as other decades…there was actually a bit of everything,” he said. As seen on MSGM’s Spring 2018 show: tie-dye and a bit of grunge, two styles that are synonymous with the decade #wwdfashion #wwddecades (📷: @kukukuba)
Breaking News: @hedislimane joins @celine as its new artistic, creative and image director. One of fashion’s preeminent image-makers and trendsetters, Slimane is to join the LVMH brand on Feb. 1 and unveil his first fashion proposition for men and women next September during Paris Fashion Week. It marks a major homecoming for Slimane, who cemented his reputation – and influenced men’s tailoring for more than a decade – as the designer of Dior Homme between 2000 and 2007. He went on to reinvent and ignite the house of Yves Saint Laurent, which he rechristened Saint Laurent, between 2012 and 2016 – all the while maintaining a close relationship with the Arnault family, which controls LVMH and Dior. Read the full exclusive story on WWD.com. Link in bio. #wwdnews #wwdfashion
“Personally I believe the Eighties have been the richest and more vivacious period for international fashion,” Giorgio Armani said when asked what his favorite decade of fashion is. It was a moment of disruption and experimentation and only thinking back to the first years of that decade is always an emotion for me, for what they have meant to me and my work.” The influence is clear in @giorgioarmani spring 2018 collection, pictured here, which was full of bright colors and unexpected prints. Read more about which decades designers loved most on WWD.com #wwdfashion #wwddecades (📷: @aitorrosasphoto)
For Lady Gaga’s only Italian show on her “Joanne World Tour,” the singer wore a range of @versace_official outfits. The standout piece: this custom-made bodysuit inspired by the brand’s spring 2018 collection. #wwdfashion (RG: @ladygaga)
@_camillaruth_ is expanding on the wellness-craze concept with @westbourne – a new NYC restaurant that’s both a healthy-minded café as well as a business that gives back to the community. Marcus works with the Robin Hood foundation to give back to The Door, a non-profit providing youth development services, and also hires employees through The Door. Read our full interview with Marcus on giving back through food on WWD.com. #wwdeye (📷: @lexieblacklock)