Nordstrom Inc. reported an 11.7 percent increase in fourth-quarter earnings to $201 million, from $180 million a year ago, exceeding expectations and outperforming competitors Macy’s Inc. and Dillard’s, which earlier this week posted declines.
Net sales increased 2.4 percent to $4.24 billion from $4.14 billion, and comparable sales decreased 0.9 percent.
The company was lifted by gains at its offprice division and cited “continuous improvements to its operating model.”
Across U.S. full-line stores and nordstrom.com, the top-performing merchandise categories were women’s apparel and beauty. The younger customer-focused departments in women’s apparel continued to outperform, reflecting strength in denim and collaborations with new and emerging limited distribution brands, the company said.
Combined, sales at Nordstrom’s U.S. and Canada full-line stores, Nordstrom.com, and Trunk Club decreased 1.1 percent and comparable sales fell 2.7 percent.
Nordstrom Rack and Nordstromrack.com/HauteLook combined net sales increased 10.7 percent and comparable sales increased 4.3 percent.
Nordstrom said the East was the top-performing geographic region.
Retail gross profit increased 112 basis points compared with the same period in fiscal 2015, reflecting “strong inventory execution in addition to reduced competitive markdowns.” Inventory declined 2.5 percent which reflected a positive spread of 5 percentage points relative to sales growth.
For the year, net earnings fell to $354 million from $600 million, with earnings before interest and taxes of $1.1 billion representing a decrease of $210 million relative to last year, primarily due to asset impairment charges and other non-operational items in 2016 and 2015. Excluding these items, retail EBIT decreased $55 million, primarily due to higher technology and fulfillment costs supporting multi-channel growth.
Total net sales for the year reached $14.5 billion, a 2.9 percent increase compared to net sales of $14.1 billion in 2015. Comparable sales for the fiscal year 2016 decreased 0.4 percent.