Neiman Marcus Inc. practically doubled its profits during its first quarter ended Oct. 29, but executives kept their cool, citing the potential impact of stock market gyrations and troubled economies around the world.
“We do remain concerned with the broader economy and effects on our customers. Our customers are very attuned to the fluctuations of the stock market and sensitive to the world economic news,” Karen Katz, Neiman’s president and chief executive officer, told investors during a conference call Monday. “As we move into the holidays, we are ever mindful of the uncertainty of the economic news here and abroad.”
However, Katz also said Neiman’s is “well positioned with luxury fashion and the latest trends.”
Although business has been good, Neiman’s executives declined to forecast Christmas or beyond. Katz did offer some positives, however, noting the company’s fortunes are not as tied to Black Friday and that Neiman’s customers tend to shop steadily through the holiday period. “We view the holidays as a time to introduce a full array of gift suggestions. A person can find something from $50 to $50,000.”
She even said certain “fantasy gifts” offered in Neiman’s Christmas catalogue have sold already, such as a $125,000 custom-made library from Assouline that includes wall-to-wall interior design and 250 books; five Johnny Walker Scotch tasting parties for $5,000 each, and 10 bespoke Ferrari cars, priced $395,000 each.
For the quarter, Neiman’s generated $48.4 million in net earnings, compared with $25.7 million a year ago. Sales totaled $1 billion, compared with $927.2 million in the prior year, and comparable revenues rose 8 percent.
Operating earnings from the specialty store group comprised of Neiman Marcus, Bergdorf Goodman and Last Call clearance centers rose to $125.3 million from $108 million. Neiman Marcus Direct saw operating earnings grow to $28.1 million from $25 million.
Revenues at the specialty group rose to $811.8 million from $761.1 million; direct marketing grew to $191.3 million from $166.1 million.
After the call, Katz told WWD that “a great product offering” and increased full-price selling fueled the quarter’s results. She also said resort merchandise in the stores now and the upcoming spring collections look strong. “There’s color, femininity and new trends,” she said.
Katz cited women’s contemporary sportswear, shoes, designer handbags, precious jewelry accessories, beauty and men’s wear as standout categories in the last quarter in stores. The best-performing regions were the West and Southeast, notably Texas and Florida.
With business going well, Katz said, “We don’t feel the need to be more promotional. Inventories are in good control, and we are going on the same kind of promotional cadence as we did last year.” As far as buying, the approach for pre-fall is “kind of cautious.”
Since taking over the reins from Burt Tansky over a year ago, Katz has accelerated technology initiatives to capture greater e-commerce sales and strengthen communications with customers. Smartphones are being distributed to sales associates so they can contact customers via texts, e-mails, phone calls and photographs of products. Currently, smartphones are in the hands of associates at 10 stores. The goal is to have all 42 full-line Neiman Marcus locations outfitted by the end of July, which marks the conclusion of Neiman’s fiscal year.
Neiman’s is also improving its Web site to streamline the checkout procedure, reduce the number of clicks between the entry page and those featuring merchandise, enhance visuals, introduce vendors and refine e-mails so they’re more targeted and personalized to customers. “Clientele management is at the heart of our business model,” Katz said. “If a customer shops contemporary exclusively, we probably would not send an e-mail on fine apparel.” The Last Call clearance Web site has also been enhanced with a new graphic design and simplified navigation.
Neiman’s capital budget for the current fiscal year has been boosted to $160 million to $170 million from less than $100 million, primarily to pay for technology enhancements as well as store renovations and building a new full-line store in Walnut Creek, Calif., which is scheduled to open in March.
The company is also measuring service and loyalty levels through a 10-question survey called the NPS or Net Promoter Score. Among other inquiries, it asks how likely a customer is to recommend Neiman Marcus for shopping. “When we compare ourselves to industry standards, we’re performing very well and although our scores are high, we still aim to be higher and we’re using the customer feedback to drive improvements to our service and to our merchandise offerings,” Katz said.
“What he has done at Vuitton is really exceptional,” said @gameofthrones’ actress Gwendoline Christie on @mrkimjones’ final show for @louisvuitton. “He has rebooted luxury in terms of making it commercial, viable and contemporary. And most importantly artistic. He has never compromised his artistic vision for the sake of commodity.” (📷: @zefashioninsider)
After seeing a demand for men’s wear from its customers, British contemporary women’s wear label @ariesarise has added a men’s wear component and will launch a unisex collection with @mrporterlive. The 20-piece collection includes jackets, denim, logo T-shirts and more with deconstructed ‘90s vibes. Set to launch on January 18, you can shop the pieces on Aries’ website and on mrporter.com. #wwdfashion
“And so spending so much time with a character who thinks like that, inevitability you try and analyze yourself and go back and think about your own demons and dark chapters that you had in your life,” says @thedanielbruhl of his role in TNT’s “The Alienist.” The show, set in the Gilded Age of New York, also stars Dakota Fanning and Luke Evans. Head to WWD.com to read about how 39-year-old Brühl prepared for the role and why he thinks the show is so relevant to today #wwdeye ( 📷: @Eriktanner)
Now that Celine Dion’s collection has topped $10 million in sales, the pop superstar, fashion icon and newly-minted industry player is eyeing growth in Asia. Read the full report by @tiffanyap, link in bio. #wwdnews #celinedion
“My personal philosophy to beauty is paying attention to oneself. I love to be outdoors, lots of fresh air, trying to take care of yourself as best you can. I always notice that comes through,” says Felicity Jones, the global face of @shiseido-owned @cledepeaubeauteus, which launches today. Head to WWD.com to read more about the actress’ love for beauty and how she prepared for her new role in “The Basis of Sex,” playing the young Ruth Bader Ginsburg. #wwdbeauty (📷: @dandoperalski)
Among the familiar faces at @off____white’s show was a surprise figure: Japanese artist @takashipom, pictured here on Wednesday morning. Other show-goers included @jerrylorenzo, who spoke about his upcoming project: a @nike collaboration for back to school, with designs inspired by his childhood on the West Coast. Sitting in the front row were Future, Don Crawley, @miguel and more. See the rest of the photos on WWD.com #wwdeye (📷: Stephane Feugere)
According to @laurentsai, former “Terrace House: Aloha State” cast member, she didn’t know she was auditioning for the Japanese version of “Real World.” “I was telling a couple of my friends and someone’s like, ‘That sounds a lot like Terrace House.’ I was like, ’No it can’t be.’” Turns out, it was. But Tsai isn’t just a reality star — she’s an illustrator who has worked with Starbucks Japan and most recently, she’s dipping her toes into the fashion world. Head to WWD.com to read about her time on the show, modeling and her art. #wwdeye (📷: @danieldorsa)
More changes are coming to New York Fashion Week: Beginning with the spring 2019 collection, @alexanderwangny will move his New York show to June from September, adopting a biannual schedule with collections shown in June and December. Additionally, the @cfda is planning for an official summer/winter fashion season taking place as soon as June and December 2018. Read more about the upcoming changes on WWD.com. #wwdnews #wwdfashion (📷: @slovekinpics)