Nordstrom profit slides, but retailer unfazed
The Seattle-based luxury retailer’s profit fell about 6 percent as an anniversary sale that usually boosts sales was held earlier in the year.
The Associated Press
Nordstrom’s third-quarter profit fell about 6 percent, as its anniversary sale, which usually boosts results, took place this year entirely during the second quarter.
But the results Thursday beat expectations, and the Seattle company raised the lower end of its full-year earnings guidance.
The news comes as retailers prepare for the all-important holiday season, which can account for up to 40 percent of annual sales.
So far, retailers’ outlooks for the season have been mixed. Kohl’s and Wal-Mart Stores both lowered their forecast for the season, but Macy’s gave a bullish view on the holidays.
Overall the National Retail Federation, the nation’s largest retail-trade group, expects an increase of 3.9 percent to $602.1 billion in holiday sales.
There are six fewer shopping days this holiday season, but Nordstrom said that should not affect sales.
“We’ve looked at this over the years, and years where we’ve had more days and years where we’ve had less days, and we tend to see that the overall shopping bag is relatively the same,” said Chief Financial Officer Mike Koppel. “So we planned accordingly and we expect a good holiday season.”
Nordstrom ’s net income for the three months ended Nov. 2 fell to $137 million, or 69 cents a share, down from $146 million, or 71 cents a share, a year ago.
Revenue rose 3 percent to $2.88 billion from $2.81 billion last year. Revenue in stores open at least one year, a key retail metric, rose 0.1 percent.
Top sellers included makeup, women’s clothing and women’s shoes.
Analysts surveyed by FactSet had expected earnings of 67 cents a share on revenue of $2.87 billion.
The company adjusted its fiscal 2013 profit guidance to between $3.65 and $3.70 a share, from prior guidance of $3.60 to $3.70 a share. Analysts expect earnings of $3.68 per share.
Nordstrom expects revenue to rise 3.5 percent, versus prior guidance of 3 to 4 percent, implying revenue of $12.4 billion. Analysts expect $12.58 billion.
The retailer’s shares fell 90 cents, or 1.4 percent, to $62.53 in after-hours trading Thursday.