May 16, 2014
Nordstrom’s full line stores saw first quarter same store sales decline but the department store operator’s off price Rack division is doing just fine.
Total sales increased 6.8% to $2.8 billion with top-performing categories including accessories, women’s shoes, and cosmetics. A 3.9% overall same store sales increase was comprised of a 1.9% decline at full line stores and a 6.4% comp increase at the rapidly expanding Nordstrom Rack stores. Nordstrom’s direct (e-commerce) sales grew by 33% in the quarter on top of a 25% prior year increase and the company launched its Nordstromrack.com Web site.
Nordstrom said its profits declined to $140 million, or 72 cents a share, from $145 million, or 73 cents a share, due in large part to heavy investments in technology and supply chain to support omnichannel initiatives and entry into Canada. Despite the decline, the company’s earnings of 72 cents were four cents better than analysts expected and above the company’s guidance range of 60 cents to 70 cents.
Nordstrom ended the quarter with 117 full line stores, the same as the prior year, while the number of Rack outlets increased to 150 locations from 128. During the remainder of the year, three new full line stores are expected to open along with 17 Rack stores.
Source: Retailing Today
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