- Prachi Singh |
Nordstrom said its fourth quarter earnings exceeded expectations, reflecting continuous improvements to its operating model. Earnings per diluted share were 1.15 dollars. Net sales increased 2.4 percent and comparable sales decreased 0.9 percent for the quarter. For fiscal 2016, earnings per diluted share of 2.02 dollars. Net sales increased 2.9 percent and comparable sales decreased 0.4 percent for the fiscal year.
Excluding the fourth quarter tax effect of the Trunk Club goodwill impairment, adjusted earnings per diluted share were 1.37 dollars. Fourth quarter results also included a non-operational gain of 0.10 dollar. Excluding the Trunk Club impairment charge, adjusted earnings per diluted share was 3.14 dollars for the year, above the company's outlook of 2.85 dollars to 2.95 dollars.
Nordstrom reports increase in FY16 sales
In 2016, the company reached sales of 14.5 billion dollars. Nordstrom said it achieved the following milestones in executing its growth plans. The company continued market expansion into Canada for a total of five full-line stores, including two Toronto store openings in fall 2016 that contributed 300 million dollars in total sales. Nordstrom.com sales reached over 2.5 billion dollars, representing approximately 25 percent of Nordstrom full-price sales, Nordstrom Rack sales grew 11 percent to 4.5 billion dollars driven by 21 new store openings and 32 percent online growth; Nordstromrack.com/HauteLook reached 700 million dollars, representing over 15 percent of off-price sales and Nordstrom Rewards active customers increased by 56 percent to 7.8 million; sales from Nordstrom Rewards customers represented 44 percent of sales.
Full year net earnings were 354 million dollars and EBIT was 0.8 billion dollars or 5.6 percent of net sales, compared with net earnings of 600 million dollars and EBIT of 1.1 billion dollars or 7.8 percent of net sales, for the same period in fiscal 2015. Retail EBIT decreased 210 million dollars relative to last year.
Fourth quarter result highlights
Fourth quarter net earnings were 201 million dollars and EBIT was 424 million dollars or 10 percent of net sales, compared with net earnings of 180 million dollars and EBIT of 324 million dollars or 7.8 percent of net sales for the same period in fiscal 2015. Retail EBIT increased 84 million dollars compared with the same quarter last year, reflecting non-operational items in 2016 and 2015. Excluding these items, Retail EBIT increased 12 million dollars, or 3.3 percent.
Total company net sales of 4.2 billion dollars increased 2.4 percent compared with net sales of 4.1 billion dollars during the same period in fiscal 2015. Total company comparable sales decreased 0.9 percent. In the Nordstrom brand, including US and Canada full-line stores and Nordstrom.com, net sales when combined with Trunk Club, decreased 1.1 percent and comparable sales decreased 2.7 percent. Across US full-line stores and Nordstrom.com, the top-performing merchandise categories were women's apparel and beauty.
In the Nordstrom Rack brand, which consists of Nordstrom Rack stores and Nordstromrack.com/HauteLook, net sales increased 10.7 percent and comparable sales increased 4.3 percent. The East was the top-performing geographic region. Retail gross profit, as a percentage of net sales, of 36 percent increased 112 basis points compared with the same period in fiscal 2015.
Nordstrom has announced plans to open one new full-line store, 15 new Nordstrom Rack stores, two full-line store relocations and one Nordstrom Rack store relocation in 2017.