November 17, 2010
Nordstrom's Fashionable Shoppers Boost Store Results
Robert Doyle READ TIME: 2 MIN.
NEW YORK (AP) - Upscale department store chain Nordstrom Inc. said Monday that its third-quarter net income rose 43 percent, boosted by an increase in regular-price selling and tight inventory controls.
The company, based in Seattle, also raised its earnings outlook, but not as high as analysts expected on average, and Nordstrom shares fell 25 cents in aftermarket trading to $41.58. The shares had ended regular trading up 43 cents.
Nordstrom said it earned $119 million, or 53 cents per share, for the period that ended Oct. 30. That compares with $83 million, or 38 cents per share, a year earlier.
As the chain's mainly upper-income customers continued to spend more this year than last year, Nordstrom's revenue rose 11 percent, to $2.18 billion from $1.96 billion.
Revenue at stores opened at least a year rose 5.8 percent. The measure is a key indicator of a retailer's health because it excludes stores that open and close during the year.
Analysts surveyed by Thomson Reuters on average expected Nordstrom to report earnings of 51 cents per share and revenue of $2.09 billion.
Among the best sellers across its businesses including online were jewelry, dresses and shoes.
"Our customers are highly receptive to newness and fashion in spite of the soft economic climate," Blake Nordstrom, the company's president, told investors during a conference call.
Revenue at its lower-price Nordstrom Rack division rose 17.9 percent to $65 million. But revenue at Rack stores open at least a year fell 2.2 percent, a drop executives attributed to new stores siphoning business from established ones. Blake Nordstrom told investors the company is addressing the problem.
"The overall picture of the Rack is a positive one," he said. "It's helping us achieve more total sales."
The company expects to open 16 to 18 additional discount stores in 2011.
Nordstrom now expects to earn $2.60 to $2.65 per share for the year, up from a range of $2.50 to $2.65 per share it forecast in August. But analysts predicted $2.64 per share.
Nordstrom operates 118 Nordstrom stores and 86 Rack stores.
Long-term New Yorkers, Mark and Robert have also lived in San Francisco, Boston, Provincetown, D.C., Miami Beach and the south of France. The recipient of fellowships at MacDowell, Yaddo, and Blue Mountain Center, Mark is a PhD in American history and literature, as well as the author of the novels Wolfchild and My Hawaiian Penthouse. Robert is the producer of the documentary We Are All Children of God. Their work has appeared in numerous publications, as well as at : www.mrny.com.
