SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission File Number 0-6074
Nordstrom, Inc.
______________________________________________________
(Exact name of Registrant as specified in its charter)
Washington 91-0515058
_______________________________ ___________________
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1501 Fifth Avenue, Seattle, Washington 98101
____________________________________________________
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (206) 628-2111
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the Registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
YES X NO
_____ _____
Common stock outstanding as of May 27, 1996: 81,363,043 shares of
common stock.
1 of 8
NORDSTROM, INC. AND SUBSIDIARIES
--------------------------------
INDEX
-----
Page
Number
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)
Consolidated Statements of Earnings
Three months ended April 30, 1996
and 1995 3
Consolidated Balance Sheets
April 30, 1996 and 1995 and
January 31, 1996 4
Consolidated Statements of Cash Flows
Three months ended April 30, 1996
and 1995 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 8
Item 6. Exhibits and Reports on Form 8-K 8
2 of 8
NORDSTROM, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(dollars in thousands except per share amounts)
(unaudited)
Three Months
Ended April 30,
-------------------
1996 1995
-------- --------
Net sales $905,962 $815,598
Costs and expenses:
Cost of sales and related buying
and occupancy 617,112 553,753
Selling, general and administrative 268,787 239,771
Interest, net 9,394 7,673
Service charge income and other, net (34,580) (31,276)
-------- --------
Total costs and expenses 860,713 769,921
-------- --------
Earnings before income taxes
and extraordinary item 45,249 45,677
Income taxes 17,900 18,000
-------- --------
Earnings before extraordinary item 27,349 27,677
Extraordinary charge related to the
early extinguishment of debt, net
of income taxes of $900 1,452 ---
-------- --------
Net earnings $ 25,897 $ 27,677
======== ========
Earnings before extraordinary item
per average share of common stock
outstanding $ .34 $ .34
======== ========
Net earnings per average share of
common stock outstanding $ .32 $ .34
======== ========
Cash dividends paid per share of
common stock outstanding $ .125 $ .125
======== ========
These statements should be read in conjunction with the Notes to
Consolidated Financial Statements contained herein and in the Nordstrom
1995 Annual Report to Shareholders.
3 of 8
NORDSTROM, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
(unaudited)
April 30, January 31, April 30,
1996 1996 1995
---------- ---------- ----------
ASSETS
Current Assets:
Cash and cash equivalents $ 33,426 $ 24,517 $ 68,744
Accounts receivable, net 864,137 893,927 666,901
Merchandise inventories 731,647 626,303 692,652
Prepaid income taxes and other 67,759 68,029 59,952
---------- ---------- ----------
Total current assets 1,696,969 1,612,776 1,488,249
Property, buildings and
equipment, net 1,109,287 1,103,298 1,001,288
Other assets 16,943 16,545 15,073
---------- ---------- ----------
TOTAL ASSETS $2,823,199 $2,732,619 $2,504,610
========== ========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Notes payable $ 303,423 $ 232,501 $ 158,582
Accounts payable 356,965 277,584 306,045
Accrued salaries, wages
and taxes 141,304 185,540 132,863
Accrued expenses 51,487 47,834 44,105
Accrued income taxes 18,282 14,644 17,736
Current portion
of long-term debt 74,210 74,210 65,967
---------- ---------- ----------
Total current liabilities 945,671 832,313 725,298
Long-term debt 322,440 365,733 339,768
Deferred lease credits and
other deferred items 111,121 111,601 77,669
Shareholders' Equity:
Common stock, without par value:
250,000,000 shares authorized;
81,256,947, 81,113,144 and
82,274,034 shares issued
and outstanding 176,596 168,440 164,012
Retained earnings 1,267,371 1,254,532 1,197,863
---------- ---------- ----------
Total shareholders' equity 1,443,967 1,422,972 1,361,875
---------- ---------- ----------
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $2,823,199 $2,732,619 $2,504,610
========== ========== ==========
These statements should be read in conjunction with the Notes to
Consolidated Financial Statements contained herein and in the Nordstrom
1995 Annual Report to Shareholders.
4 of 8
NORDSTROM, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
(unaudited)
Three Months
Ended April 30,
---------------------
1996 1995
-------- --------
OPERATING ACTIVITIES:
Earnings before extraordinary item $ 27,349 $ 27,677
Adjustments to reconcile earnings
to net cash provided by (used in)
operating activities:
Extraordinary charge related to the
early extinguishment of debt, net
of income taxes of $900 (1,452) ---
Depreciation and amortization 38,080 29,577
Change in:
Accounts receivable, net 29,790 8,990
Merchandise inventories (105,344) (64,722)
Prepaid income taxes and other 270 1,443
Accounts payable 79,381 32,961
Accrued salaries, wages and taxes (44,236) (57,638)
Accrued expenses 3,653 3,115
Income tax liabilities and other 1,190 (6,253)
Deferred lease credits 1,969 14,548
-------- --------
Net cash provided by (used in) operating
activities 30,650 (10,302)
-------- --------
INVESTING ACTIVITIES:
Additions to property, buildings
and equipment, net (43,548) (46,541)
Other (920) (115)
-------- --------
Net cash used in investing activities (44,468) (46,656)
-------- --------
FINANCING ACTIVITIES:
Increase in notes payable 70,922 71,194
Proceeds from issuance of common stock 8,156 678
Principal payments on long-term debt (43,293) (10,175)
Cash dividends paid (10,141) (10,280)
Purchase and retirement of common stock (2,917) ---
Proceeds from issuance of long-term debt, net --- 41,788
-------- --------
Net cash provided by financing activities 22,727 93,205
-------- --------
Net increase in cash and cash equivalents 8,909 36,247
Cash and cash equivalents at
beginning of period 24,517 32,497
-------- --------
Cash and cash equivalents at end of period $ 33,426 $ 68,744
======== ========
These statements should be read in conjunction with the Notes to
Consolidated Financial Statements contained herein and in the Nordstrom
1995 Annual Report to Shareholders.
5 of 8
NORDSTROM, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED APRIL 30, 1996 AND 1995
(dollars in thousands)
(unaudited)
Note 1:
The consolidated balance sheets of Nordstrom, Inc. and subsidiaries (the
"Company") as of April 30, 1996 and 1995, and the related consolidated
statements of earnings and cash flows for the periods then ended, have
been prepared from the accounts without audit.
The consolidated financial information is applicable to interim periods
and is not necessarily indicative of the results to be expected for the
year ending January 31, 1997.
It is not considered necessary to include detailed footnote information
as of April 30, 1996 and 1995. The financial information should be read
in conjunction with the Notes to Consolidated Financial Statements
contained in the Nordstrom 1995 Annual Report to Shareholders.
In the opinion of management, the consolidated financial information
includes all adjustments (consisting only of normal, recurring
adjustments) necessary to present fairly the financial position of
Nordstrom, Inc. and subsidiaries as of April 30, 1996 and 1995, and the
results of their operations and cash flows for the periods then ended,
in accordance with generally accepted accounting principles applied on a
consistent basis.
Certain reclassifications of prior year balances have been made for
consistent presentation.
Note 2:
During the first quarter of 1996, the Company elected to prepay $43,100
of Nordstrom Credit, Inc. 9.375% sinking debentures in order to take advantage
of lower short-term interest rates. This resulted in an extraordinary charge
of $1,452, net of applicable income taxes of $900 ($0.02 per share).
Note 3: The summarized combined results of operations of Nordstrom
Credit, Inc. and Nordstrom National Credit Bank are
as follows:
Three Months Ended April 30, 1996 1995
------- -------
Total revenue $39,212 $29,523
Earnings before income taxes
and extraordinary item 13,531 8,727
Extraordinary charge related
to the early extinguishment
of debt, net of income taxes
of $900 1,452 ---
Net earnings 7,109 5,587
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NORDSTROM, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the
Management Discussion and Analysis section of the Nordstrom 1995 Annual
Report to Shareholders.
Results of Operations:
- ----------------------
During the first quarter of 1996, sales increased 11.1% when compared
with the same quarter in 1995. Sales for comparable stores increased
3.9% during the quarter, with the remainder of the increase coming from
new units. Comparable store sales results were the strongest they have
been in over a year, most notably in the California market. The Company,
however, remains cautious with respect to sales projections for the
remainder of the year.
Cost of sales and related buying and occupancy costs increased as a
percentage of sales when compared to the same quarter in 1995 due
primarily to higher occupancy costs resulting from new stores and
remodeling projects.
Selling, general and administrative expenses increased as a percentage
of sales when compared to the same quarter in 1995. Factors that contributed
to the increase included higher bad debt expenses resulting from growth in the
Company's VISA card program as well as an increase in the level of write-offs,
and higher sales promotion costs due to accelerating certain promotional
activities from the third to the first quarter in 1996. These increases were
partially offset by lower distribution costs for the Company's direct sales
division and decreased spending on development of a new payroll system which
was implemented in early 1996.
Interest expense increased as a percentage of sales when compared to the same
quarter in 1995 primarily due to higher levels of debt outstanding during the
quarter. The increase was partially offset by a decrease in interest rates.
Service charge income and other, net was affected by two primary factors. Net
revenues from the Company's VISA and proprietary card programs increased by
40% compared to the prior year as result of growth in these programs. The
impact of this increase was offset by the effect of one-time gains in the
prior year on the sale of a closed distribution facility and a full-line
store, totalling $6.3 million ($0.05 per share after income taxes).
Certain other information required by this item is included in Note 2 to the
financial statements under Part I, Item 1, which note is incorporated herein
by reference.
Financial Condition:
- --------------------
During the quarter, the Company opened two new full-line stores in the
King of Prussia Plaza in King of Prussia, Pennsylvania and at the Dallas
Galleria in Dallas, Texas, and opened a clearance store in the Village
Square of Northbrook in Northbrook, Illinois. Construction is
progressing as planned on new stores scheduled to open later this year
and in 1997.
7 of 8
NORDSTROM, INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
- --------------------------
The Company is not involved in any material pending legal proceedings,
other than routine litigation in the ordinary course of business.
Item 6. Exhibits and Reports on Form 8-K
- -----------------------------------------
(a) Exhibits
--------
(27.1) Financial Data Schedule is filed herein as an Exhibit.
(b) Reports on Form 8-K
-------------------
No reports on Form 8-K were filed during the quarter for which this
report is filed.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NORDSTROM, INC.
(Registrant)
/s/ John A. Goesling
------------------------------------------
John A. Goesling, Executive Vice President
and Treasurer
(Principal Financial and Accounting Officer)
Date: June 10, 1996
- --------------------
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NORDSTROM, INC. AND SUBSIDIARIES
Exhibit Index
Exhibit Method of Filing
- ------- ----------------
27.1 Financial Data Schedule Filed herewith electronically
5
1,000
3-MOS
JAN-31-1997
APR-30-1996
33,426
0
864,137
0
731,647
1,696,969
1,109,287
0
2,823,199
945,671
322,440
176,596
0
0
1,267,371
2,823,199
905,962
905,962
617,112
860,713
0
0
9,394
45,249
17,900
0
0
1,452
0
25,897
0.32
0.32
