Nordstrom Inc. late Thursday met expectations with a 39 percent jump in second-quarter earnings as healthy increases in sales in its other operations more than offset a slight decline in same-store sales at Nordstrom Rack.
For the three months ended July 31, net income was $146 million, or 66 cents a diluted share, compared with $105 million, or 48 cents, a year ago. Boosting the bottom line was a $12 million reduction in selling, general and administrative expenses for its credit operations, much of it attributable to a $15 million cut in its reserve for bad debt, a reflection of improved credit trends. Delinquencies dropped to 3.5 percent of accounts receivable from 4.2 percent at the end of the first quarter and 3.6 percent a year ago.
Sales rose 12.7 percent to $2.42 billion from $2.15 billion and, with the addition of funds from its credit card operation, total revenues increased to $2.52 billion from $2.23 billion. Nordstrom said multichannel comparable-store sales rose 9 percent, with an 8.2 percent comp increase in full-line stores and a 34.1 percent climb in direct sales. Comps during the anniversary sale event rose 9 percent, with jewelry, dresses and women’s shoes as the top-performing categories.
Comps at Nordstrom Rack dipped 0.9 percent, but executives on the company conference call said they continue to see the operation as a growth opportunity. On the company conference call, Mike Koppel, executive vice president and chief financial officer, called it “a productive business model and its new stores are performing above plan.”
The Seattle-based upscale retailer noted sales per square foot were up 8.3 percent while inventory per square foot rose 8.7 percent compared with the comparable 2009 period.
For the six months, income rose 40.9 percent to $262 million, or $1.18 a diluted share, from $186 million, or 86 cents, last year. Total revenues rose 14.4 percent to $4.6 billion from $4.02 billion.
Blake Nordstrom, president, said on the call that the “first half had exceeded our expectations. We’re particularly encouraged by our sales results and how the customer is responding to our merchandise and services.”
He added the anniversary sale event benefited from a shared inventory platform that combined its full-line and direct businesses, allowing the retailer to add more anniversary items in its direct fulfillment center to better meet customer demand.
“From our point of view, we have not seen any change throughout this year,” Nordstrom said of the state of consumer spending. “Nor do we expect in the foreseeable future a change upward or downward with our customers.”
The company maintained its forecast for fiscal 2010, with earnings per diluted share in the $2.50 to $2.65 range, and a 4 to 6 percent comps gain. Analysts had expected earnings per share of $2.62 for the year. Shares fell 4.3 percent to $32 in after-hours trading after closing down 0.4 percent at $33.44 prior to the announcement.
@fearofgod and @maxfieldla have teamed up on a pop-up installation. The store, located in the gallery space across from Maxfield’s Melrose Ave location, is the site of the brand’s House of God pop-up in which Fear of God founder @jerrylorenzo has created a church-inspired installation. A dozen vintage church pews sit in front of an LED screen playing 90s gospel singers in an effort to re-create an environment akin to a Southern Baptist Church, Lorenzo explained. Read more about the pop-up on WWD.com #wwdfashion (📷: Jennifer Johnson)
Known for his sleek, sophisticated American glamour, Norman Norell is the subject of an upcoming exhibition at @fitnyc. “Norell: Dean of American Fashion,” which runs from February 9 through April 14, will feature approximately 100 ensembles and accessories. His best work is exemplified by the designer’s glittering “mermaid” gowns frosted with thousands of hand-sewn sequins – like the one pictured. (📷: William Helburn) #wwdfashion
For pre-fall 2018, @balmain didn’t let go of the glitz. A crystal embroidered baseball jacket priced at around $40,000 hangs in the “couture” section of the brand’s first men’s pre-collection. Sporting the words “Balmain Army” across the back, the item took around two months to make. “When it was completed, it was like Christmas, it was like, ‘It’s done, it’s exactly what I wanted,’” said Balmain’s creative director @olivier_rousteing during a tour of the collection in a Paris showroom on Monday. #wwdfashion
Eighty degree temperatures and outdoor installations at the annual Art Basel Miami Beach called for bright, elevated beachwear. See more street style pictures on WWD.com. #theyarewearing #ABMB (📷: @lifeinreverie)
Following September’s emotional tribute to her brother Gianni, Donatella Versace wanted to bring the spring show’s deep sense of intimacy to her @versace_official pre-fall collection. Donatella found inspiration in Versace Palazzo in Milan and from Gianni’s opulent apartment. Archival patterns and new motifs were splashed on silk shirtdresses and fitted jersey frocks. See the rest of the photos on WWD.com. #wwdfashion
Demna Gvasalia continues to shake up the Paris fashion calendar — and experiment with new runway timetables for his @vetements_official brand. WWD has learned that Vetements plans to stage its next coed show for the fall 2018 season on January 19 during Men’s Fashion Week in the French capital. Details about the timing and venue have not been confirmed — stay tuned on WWD.com to catch the latest. #wwdnews (📷: @giovanni_giannoni_photo)
@zacposen's go-to holiday gift? Cookies! "I'll usually bake cookies and send them as a gift," said the designer, who recently released his cookbook "Cooking With Zac: Recipes from Rustic to Refined." Get the recipe for his Brown Butter-Chocolate Chip Cookies via link in bio 🍪🍪🍪 #wwdeye #cookingwithzac
For @monsemaison’s pre-fall 2018 collection, Fernando Garcia and Laura Kim honed in on the brand’s many signatures — men’s wear, which was tweaked and feminized through deconstruction, proportion play and lots of bare shoulders. See the rest of the photos on WWD.com #wwdfashion (📷: George Chinese)
On Friday night, @yohjiyamamotoofficial received the Design for Asia Lifetime Achievement Award in Hong Kong. The 75-year-old designer has been celebrated for many years and is best known for his dark and avant-garde tailoring. “In my long career, in design, architecture, [I’ve been to] so many parties, this is the very first time that I have such a warm feeling, I really appreciate this,” Yamamoto said. #wwdfashion (📷: @dominiquemaitre)