For the first quarter, Nordstrom, Inc. reported net earnings of 20 million dollars and earnings per diluted share (EPS) of 13 cents.
Excluding a gain on the sale of the company's interest in a corporate office building and an impairment charge related to a Trunk Club property, the company posted an adjusted loss per share of 6 cents.
The company said in a release that for the first quarter, net sales increased 18.7 percent versus the same period in fiscal 2021, exceeding pre-pandemic sales levels, and gross merchandise value (GMV) increased 19.6 percent.
"In the first quarter, we drove strong topline growth with broad-based improvement across core categories and geographies. Importantly, we made progress on our strategic initiatives and continue to focus on increasing profitability on the path to achieving our financial targets," said Erik Nordstrom, chief executive officer of Nordstrom, Inc.
Highlights of Nordstrom’s first quarter trading
During the quarter, Nordstrom banner net sales increased 23.5 percent and GMV increased 24.8 percent. Net sales for Nordstrom Rack increased 10.3 percent and continued to show sequential improvement towards pre-pandemic sales levels.
The company added that core categories including men's and women's apparel, shoes and designer had the strongest growth against 2021 as customers refreshed their wardrobes for occasions such as social events, travel and return to office. Improvements were broad-based across regions, with urban stores having the strongest growth.
The company added that digital sales were flat compared with the same period in fiscal 2021 as customers increasingly chose to shop in-store. Digital sales represented 39 percent of total sales during the quarter.
Gross profit, as a percentage of net sales, of 32.8 percent increased 190 basis points compared with the same period in fiscal 2021. EBIT was 73 million dollars in the first quarter compared with loss before interest and taxes of 85 million dollars during the same period in fiscal 2021, while adjusted EBIT was 32 million dollars for the first quarter of 2022.
"We're pleased with the momentum we're seeing in the business and excited about our plans for the upcoming Anniversary Sale. Looking ahead, we are committed to driving additional merchandise margin improvement and increasing supply chain productivity, to deliver incremental profitability while continuing to elevate the customer experience," added Pete Nordstrom, president and chief brand officer of Nordstrom, Inc.
The company’s board of directors declared a quarterly cash dividend of 19 cents per share to be paid to shareholders of record at the close of business on May 31, 2022, payable on June 15, 2022. The board of directors also authorised a new 500 million dollars share repurchase program on May 18, 2022.
Nordstrom updates outlook
The company is updating its outlook to reflect first quarter performance, including a gain on the sale of the company's interest in a corporate office building and an impairment charge related to a Trunk Club property.
For fiscal 2022 revenue growth, including retail sales and credit card revenues is expected to range between 6 to 8 percent versus fiscal 2021.
EBIT margin is expected to be between 5.8 to 6.2 percent of sales, adjusted EBIT margin of 5.6 to 6 percent of sales, EPS of 3.38 dollars to 3.68 dollars, excluding the impact of share repurchase activity, and adjusted EPS of 3.20 dollars to 3.50 dollars.