Nordstrom 3Q profit slips, but tops expectations

AP News
Posted: Nov 14, 2013 5:51 PM
Nordstrom 3Q profit slips, but tops expectations

SEATTLE (AP) — Luxury retailer Nordstrom's third-quarter net income fell almost 7 percent as an anniversary sale that usually boosts sales was held earlier in the year.

But the results on Thursday beat expectations and the company raised the lower end of its full-year earnings guidance.

The news comes as retailers prepare for the all-important holiday season, which can account for up to 40 percent of annual sales. So far, retailers' outlooks for the season have been mixed. Kohl's Inc. and Wal-Mart Stores Inc. both lowered their forecast for the season, but Macy's Inc. gave a bullish view on the holidays.

Overall the National Retail Federation, the nation's largest retail trade group, expects an increase of 3.9 percent to $602.1 billion in holiday sales. There are six fewer shopping days this holiday season but the company said that should not affect sales.

"We've looked at this over the years and years where we've had more days and years where we've had less days and we tend to see that the overall shopping bag is relatively the same," said CFO Mike Koppel. "So we planned accordingly and we expect a good holiday season."

Nordstrom Inc.'s net income for the three months ended Nov. 2 fell to $137 million, or 69 cents per share, down from $146 million, or 71 cents per share, a year ago.

Revenue rose 3 percent to $2.88 billion from $2.81 billion last year. Revenue in stores open at least one year, a key retail metric, rose 0.1 percent. Top sellers included makeup, women's clothing and women's shoes.

Analysts surveyed by FactSet expected earnings of 67 cents per share on revenue of $2.87 billion.

The company adjusted its fiscal 2013 net income guidance to $3.65 to $3.70 per share, from prior guidance of $3.65 to $3.70 per share. Analysts expect earnings of $3.68 per share.

Nordstrom expects revenue to rise 3.5 percent, versus prior guidance of 3 percent to 4 percent, implying revenue of $12.4 billion. Analysts expect $12.58 billion.

Its shares fell $1.08 to $62.35 in after-hours trading.