Nordstrom Inc., buoyed by its strong anniversary sale amid an otherwise sluggish sales climate, as well as inventory and expense reductions, beat profit expectations, posting earnings per share of 67 cents in the second quarter, compared with predictions of 56 cents.

Based on its better-than-expected performance, the company lifted its full-year profit forecast to $2.60 to $2.75 a share, from $2.50 to $2.70 previously. Wall Street liked the results, boosting the stock 10.7 percent in after hours trading to $52.65.

Earlier in the day, Macy’s Inc. and Kohl’s Corp. also saw a lift in their stock prices, based on better-than-expected results, as well. The news that Macy’s would shutter 100 stores, primarily in the beginning of next year, also was well-received.

Nordstrom’s second-quarter earnings before interest and taxes, or EBIT, were $221 million, or 6.1 percent of net sales, compared with $377 million, or 10.5 percent of net sales, during the same period in fiscal 2015. Net earnings were $117 million compared with $211 million in the year-ago period.

Total sales were practically flat at $3.6 billion while comparable sales decreased 1.2 percent. Nordstrom full-line, nordstrom.com and Trunk Club sales on a combined basis decreased 0.4 percent on a total basis, and were down 2.3 percent on a comparable basis.

Combined sales at Nordstrom Rack, nordstromrack.com and HauteLook increased 11.2 percent, while comparable sales gained 5.3 percent.

Overall, the top-performing merchandise categories were beauty and shoes. The younger customer-focused departments in women’s apparel “continued to outperform, reflecting strength in denim and collaborations with new and emerging brands that have limited distribution,” Blake Nordstrom, copresident, said.

“Over the past several quarters, our team has been actively addressing our inventory, expense and capital, and in the second quarter, made substantial progress by bringing down inventory in line with sales,” said Nordstrom. “Those efforts, along with the strength of our anniversary sale and a great response from customers to that event, drove better-than-expected results for the second quarter.”

During a conference call, Nordstrom said the during the past several quarters, the team has been “actively addressing” inventories and capital expenditures so they are in line with sales trends.

“We are in one of the best inventory positions we have been in many years,” said Blake Nordstrom. He characterized the last anniversary sale as generating an all-time high sales volume, driving better than expected results in the quarter. The anniversary sale offers new merchandise at marked-down prices and, according to Nordstrom executives, primarily attracts customers looking for fashion newness, rather than discounted goods. When the sale ends, the merchandise is marked back up. Nordstrom typically adjusts the timing of the sale, and this year, one week of the event extended into the third quarter.

Nordstrom is also gaining some traction from its recently expanded loyalty program, so that all customers can earn points regardless of how they choose to pay. Previously, only Nordstrom customers using the Nordstrom credit card could get points.

In Canada, Nordstrom has a store opening Sept. 16 inside Toronto’s Eaton Centre, another slated to open Oct. 21 in Yorkdale and one more to bow in Sherway Gardens, bringing the total operating in the country to six.

Fifteen Rack stores are seen ultimately operating in Canada, with the first expected to open in 2018.

In 2017, volumes generated by the six Nordstrom stores in Canada will start to mitigate costs to get them up and running, according to the company.

Nordstrom is also opening in Austin, Tex., on Sept. 30. Nordstrom’s Manhattan flagship under construction on 57th Street is expected to open in 2019 and management is hopeful it will open in time for the holiday season.

In addition, 15 Nordstrom Rack units will open in the U.S. in the fall. About 15 percent of the merchandise at Rack stores comes from the Nordstrom full-line stores; the rest is from top vendor closeouts.

Mike Koppel, executive vice president and chief financial officer, said, “Merchant and planning teams are making continuous adjustments, inventories are well positioned, current and in line with sales trends.”

Nordstrom has a “modest” reduction to its Rack expansion to just under 300 stores by 2020, whereas before, it was set to hit the 300 mark.

Commenting on merchandise performance, Pete Nordstrom, copresident, said, “We experienced some good success. Beauty and shoes in particular.” He singled out boots, denim and sweaters.

“We are happy about the sales but we are very cautious to not over invest,” he said. “We are still taking a cautious approach [for] the second half.”

Aside from the anniversary sale during the quarter, “We did get some lift from the enhancement of our rewards program,” noted Erik Nordstrom, copresident. He added that those who don’t use the Nordstrom card receive one point per dollar spent, while Nordstrom cardholders get two points.

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