Nordstrom reports Q4 earnings in line with expectations

Nordstrom, Inc. has reported earnings per diluted share for the fourth quarter ended February 2, 2019 of 1.48 dollars, which its said were in-line with the company’s updated expectations provided in its holiday sales release on January 15, 2019. Net sales decreased 4.7 percent, or increased 0.1 percent excluding the 53rd week in 2017 of approximately 220 million dollars, while comparable sales increased 0.1 percent.

For fiscal 2018, earnings per diluted share was 3.32 dollars, which included a 5 cents favourable income tax benefit related to prior periods and an estimated non-recurring credit-related charge of 28 cents. Net sales for fiscal 2018 increased 2.3 percent, or 3.8 percent excluding the 53rd week, while comparable sales increased 1.7 percent.

Summary of Nordstrom’s Q4 and full year results

Fourth quarter net earnings were 248 million dollars compared with 151 million dollars during the same period in fiscal 2017 due to lower income tax expense associated with corporate tax reform. EBIT was 333 million dollars or 7.6 percent of net sales, compared with 350 million dollars or 7.6 percent of net sales for the same period in fiscal 2017. Gross profit, as a percentage of net sales, of 35.1 percent decreased 33 basis points compared with the same period in fiscal 2017.

Full year net earnings were 564 million dollars compared with 437 million dollars for fiscal 2017. EBIT was 837 million dollars or 5.4 percent of net sales, compared with 926 million dollars or 6.1 percent of net sales, for fiscal 2017. Excluding an estimated non-recurring credit-related charge of 72 million dollars in 2018, EBIT as a percent of net sales was 5.9 percent. Gross profit, as a percentage of net sales, of 34.4 percent decreased 26 basis points compared with fiscal 2017.

In full-price, comparable sales decreased 1.6 percent, primarily driven by softer traffic trends in full-line stores, while the company added, off-price sales reflected continued momentum with a comparable sales increase of 4 percent, in-line with the company’s expectations. In full-price, full year comparable sales increased 0.9 percent and in off-price, comparable sales increased 3.5 percent.

The company’s expectations for fiscal 2019 include net sales growth of 1 percent to 2 percent, credit card revenues growth of mid to high single-digit, EBIT to range between 915 dollars to 970 million dollars, EBIT margin between 5.9 percent to 6.1 percent and earnings per diluted share (excluding the impact of any future share repurchase) in the range of 3.65 dollars to 3.90 dollars.

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