Nordstrom Reports Fourth Quarter Earnings Increase
SEATTLE, Feb 20, 2003 /PRNewswire-FirstCall via COMTEX/ -- Nordstrom, Inc.
(NYSE: JWN) today reported net earnings of $60.0 million, or $0.44 per diluted
share, for the fourth quarter of 2002, which ended January 31, 2003. For the
same period last year, net earnings and earnings per diluted share were $50.7
million and $0.38, respectively. The 18 percent improvement in fourth quarter
earnings was primarily driven by increased sales and lower selling, general and
administrative expense as a percentage of sales.
(Photo: http://www.newscom.com/cgi-bin/prnh/20001011/NORDLOGO )
Net sales for the fourth quarter of 2002 increased 7.3 percent, to $1.8 billion, compared to sales of $1.6 billion in the same period last year. On a calendar basis, fourth quarter 2002 same-store sales increased 1.9 percent.
For fiscal 2002, which consists of the twelve-month period ended January 31, 2003, net earnings and earnings per diluted share were $90.2 million and $0.66, respectively, compared to net earnings and earnings per diluted share of $124.7 million and $0.93 for the same period last year, a 28 percent decline. Excluding $71.0 million (net of tax) in non-recurring and impairment charges related to the cumulative effect of an accounting change, the purchase of a minority interest in Nordstrom.com and associated reintegration costs, and the write-down of an information technology investment(C), fiscal 2002 net earnings and earnings per diluted share were $161.3 million and $1.19, respectively. Higher-than-planned increases in same-store sales coupled with planned improvements in gross profit and selling, general and administrative expense, drove the 29 percent increase in earnings, excluding non-recurring and impairment charges.
Fiscal 2002 net sales of $6.0 billion increased 6.1 percent, compared to sales of $5.6 billion in the same period in 2001. On a calendar basis, fiscal 2002 same-store sales increased 1.4 percent.
The company said it made progress executing its 2002 key initiatives, which included driving sales increases, continuing to improve operational disciplines related to gross margin and selling, general and administrative expense, and completing the implementation of perpetual inventory. Progress towards these objectives included same-store sales increases for eight of the last nine months and modest improvements in both gross margin and expense levels, on a percentage of sales basis. In addition, all major elements of the perpetual inventory implementation were completed according to plan and under budget.
"We are proud of our people and the job that they did this past year," said President Blake Nordstrom. "We are also encouraged by the opportunities we see to continue to improve both performance and service to our customers."
During fiscal 2002 Nordstrom opened eight full-line stores, four Nordstrom Rack stores and one U.S. Faconnable boutique. Gross square footage for the year increased approximately 8.0 percent, from 17,048,000 to 18,428,000.
2003 PERFORMANCE OUTLOOK:
The Company is providing the following 2003 forecasts:
First Quarter 2003 Full-Year 2003
Comp-store Sales Flat Flat to low
single-digit positive
Gross Profit Moderate improvement Moderate improvement
Selling, General and
Administrative Expenses Slight improvement Slight improvement
Service Charge Income Increase $1-3 million Increase $6-10 million
Interest Expense Flat Flat
Effective Tax Rate 39% 39%
Earnings per Share $0.23 - $0.27 $1.33 - $1.39
Square footage growth 4%
Nordstrom, Inc. is one of the nation's leading fashion specialty retailers, with
142 US stores located in 27 states. Founded in 1901 as a shoe store in Seattle,
Nordstrom today operates 88 full-line stores, 47 Nordstrom Racks, five U.S.
Faconnable boutiques, one freestanding shoe store, and one clearance store.
Nordstrom also operates 23 international Faconnable boutiques, primarily in
Europe. Additionally, Nordstrom Direct serves customers through its online
presence at http://www.nordstrom.com and through its direct mail catalogs.
Certain statements in this news release contain "forward-looking" information (as defined in the Private Securities Litigation Reform Act of 1995) that involves risks and uncertainties, including anticipated results, store openings and distribution channels, planned capital expenditures, and trends in company operations. Actual future results and trends may differ materially from historical results or current expectations depending upon factors including, but not limited to, the company's ability to predict fashion trends, consumer apparel buying patterns, the company's ability to control costs, weather conditions, hazards of nature such as earthquakes and floods, trends in personal bankruptcies and bad debt write-offs, changes in interest rates, employee relations, the company's ability to continue its expansion plans, and the impact of economic and competitive market forces, including the impact of terrorist activity or the impact of a war on the company, its customers and the retail industry. Our SEC reports may contain other information on these and other factors that could affect our financial results and cause actual results to differ materially from any forward-looking information we may provide.
CONTACT: investors, Stephanie Allen, +1-206-303-3262, or press, Shasha Richardson, +1-206-373-3038, both of Nordstrom, Inc.
NORDSTROM, INC.
CONSOLIDATED STATEMENTS OF EARNINGS - 4th Quarter
(unaudited;amounts in thousands, except per share data and percentages)
3 months % of sales 3 months % of sales
ended (except as ended (except as
1/31/03 indicated) 1/31/02 indicated)
Net sales(A) $1,750,586 100.0 $1,631,090 100.0
Cost of sales and
related buying &
occupancy (1,168,963) (66.8) (1,089,560) (66.8)
Gross profit 581,623 33.2 541,530 33.2
Selling, general and
administrative
expenses (499,180) (28.5) (468,920) (28.8)
Operating income 82,443 4.7 72,610 4.4
Interest expense, net (21,435) (1.2) (18,321) (1.1)
Service charge income
and other, net 37,326 2.1 29,050 1.8
Earnings before
income taxes 98,334 5.6 83,339 5.1
Income tax expense (38,300) (38.9)(B) (32,600) (39.1)(B)
Net earnings $60,034 3.4 $50,739 3.1
Earnings per share
Basic $0.44 $0.38
Diluted $0.44 $0.38
ADDITIONAL DATA
Average number of
shares outstanding
Basic 135,438 134,397
Diluted 135,838 134,917
2002 sales increase/(decrease)
presented on a 4-5-4 basis
(compared to prior-year period) 3 months 3 months
ended ended
Nov Dec Jan 1/31/03 1/31/02
Total sales 4.3% 9.2% 6.7% 7.1% (2.8%)
Same-store sales
Full-Line stores (1.9%) 2.9% 0.5% 0.9% (4.4%)
Rack & other 9.3% 9.4% 2.9% 7.6% (6.0%)
Total (1.0%) 3.4% 0.8% 1.5% (4.6%)
(A) Nordstrom reports quarterly financial results on a calendar basis.
The Company reports monthly sales according to the 4-5-4 Retail
Calendar. Total sales for fourth quarter 2002 and 2001 were
$1,729.3 million and $1,615.2 million, respectively, on a 4-5-4 Retail
Calendar basis.
(B) Percent of earnings before income taxes.
NORDSTROM, INC.
CONSOLIDATED STATEMENTS OF EARNINGS - Year-to-Date
(unaudited;amounts in thousands, except per share data and percentages)
12 months % of sales 12 months % of sales
ended (except as ended (except as
1/31/03 indicated) 1/31/02 indicated)
Net sales(A) $5,975,076 100.0 $5,634,130 100.0
Cost of sales and
related buying
& occupancy (3,971,372) (66.5) (3,765,859) (66.8)
Gross profit 2,003,704 33.5 1,868,271 33.2
Selling, general
and administrative
expenses (1,813,968) (30.3) (1,722,635) (30.6)
Operating income 189,736 3.2 145,636 2.6
Interest expense, net (81,921) (1.4) (75,038) (1.4)
Minority interest
purchase and
reintegration costs (53,168) (0.9) -- --
Service charge
income and other, net 140,977 2.4 133,890 2.4
Earnings before
income taxes and
cumulative effect of
accounting change 195,624 3.3 204,488 3.6
Income tax expense (92,041) (47.0)(B) (79,800) (39.0)(B)
Earnings before
cumulative effect
of accounting change 103,583 1.7 124,688 2.2
Cumulative effect of
accounting change
(net of $8,541 tax) (13,359) (0.2) -- --
Net earnings $90,224 1.5 $124,688 2.2
Earnings per share
Basic $0.67 $0.93
Diluted $0.66 $0.93
Diluted earnings per
share excluding
non-recurring charges
and accounting change $1.19(C) $0.93
ADDITIONAL DATA
Average number of shares
outstanding
Basic 135,107 134,105
Diluted 135,724 134,339
2002 sales increase/(decrease)
presented on a 4-5-4 basis
(compared to prior-year period) 12 months 12 months
ended ended
1/31/03 1/31/02
Total sales 6.1% 1.9%
Same-store sales
Full-Line stores 0.7% (2.6%)
Rack & other 7.4% (6.0%)
Total 1.3% (2.9%)
(A) Nordstrom reports year-to-date financial results on a calendar basis.
The Company reports monthly sales according to the 4-5-4 Retail
Calendar. Total sales for year-to-date 2002 and 2001 were
$5,966.5 million and $5,622.6 million, respectively, on a 4-5-4 Retail
Calendar basis.
(B) Percent of earnings before income taxes. For year-to-date 2002,
income tax expense as a percent of earnings before income taxes is
higher than Nordstrom's effective tax rate as the Company did not
recognize a tax benefit for certain costs related to the minority
interest purchase.
(C) Net earnings excluding non-recurring and impairment charges is the sum
of net earnings of $90,224, the cumulative effect of accounting change
of $13,359 (net of tax), the minority interest purchase and
reintegration costs of $48,184 (net of tax), and the write-down of an
IT investment in a supply chain tool of $9,498 (net of tax).
SOURCE Nordstrom, Inc.
CONTACT: investors, Stephanie Allen, +1-206-303-3262, or press, Shasha
Richardson, +1-206-373-3038, both of Nordstrom, Inc.
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