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Nordstrom Q2 net sales down 0.2 percent

By Prachi Singh

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Report

Nordstrom earnings per diluted share were 0.67 for the second quarter ended July 30, 2016, which the company said exceeded its expectations. Total company net sales decreased 0.2 percent and comparable sales decreased 1.2 percent, compared with the same period last year.

"Over the past several quarters, our team has been actively addressing our inventory, expense and capital, and in the second quarter, made substantial progress by bringing down inventory in-line with sales," said Blake Nordstrom, Co-President, Nordstrom, adding, "Those efforts, along with the strength of our Anniversary Sale and a great response from customers to that event, drove better than expected results for the second quarter."

Financial updates of the second quarter

Net earnings were 117 million dollars and EBIT were 221 million dollars or 6.1 percent of net sales, compared with net earnings of 211 million dollars and EBIT of 377 million dollars, or 10.5 percent of net sales, during the same period in fiscal 2015.

In the Nordstrom brand, including US and Canada full-line stores and Nordstrom.com, net sales when combined with Trunk Club, decreased 0.4 percent and comparable sales decreased 2.3 percent. Across US full-line stores and Nordstrom.com, the top-performing merchandise categories were beauty and shoes. The younger customer-focused departments in women's apparel continued to outperform, reflecting strength in denim and collaborations with new and emerging brands that have limited distribution. The Midwest was the top-performing geographic region.

In the Nordstrom Rack brand, which consists of Nordstrom Rack stores and Nordstromrack.com/HauteLook, net sales increased 11.2 percent and comparable sales increased 5.3 percent. The East was the top-performing geographic region.

Updates earnings outlook for FY16

The company expects 2.5 to 4.5 percent increase in net sales for the full fiscal year with comparable sales in the range of 1 percent decrease to 1 percent increase. Earnings per diluted share are expected to be in the range of 2.60 dollars to 2.75 dollars.

To date in fiscal 2016, the company relocated one full-line store and opened six Nordstrom Rack stores and operated 329 stores.

Picture:Nordstrom

NORDSTROM