Retail
Nordstrom posts strong first-quarter profit
By Seattle Business Magazine May 13, 2011
Seattle-based high-end retailer Nordstrom announced a strong first quarter, with a 24 percent increase in profits as prices returning to pre-recession levels.
The company reported profits of $145 million, or 65 cents a share, for the quarter ending April 30. One year ago, the company reported profits of $116 million, or 52 cents a share. Factoring out the companys recent acquisition of online daily-deals retailer HauteLook, profits would have totaled 69 cents a share, beating Wall Street estimates of 66 cents a share.
More positive news comes from the fact that prices have returned to 2006-07 levels, suggesting that customers are once again purchasing expensive, luxury items. Menswear, high-end designer apparel and jewelry were some of the best-selling items over the past quarter, the company reported.
Overall, first-quarter sales hit $2.23 billion, an increase of 12 percent compared to the same period last year. Same-store sales increased 6.5 percent.
Despite the good news, Nordstrom reduced its 2011 outlook because of the HauteLook acquisition. The company believes the purchase will dilute shares by 20 cents, but expects HauteLook to break even for the year and generate $160 to $180 million in annual sales.
For the fiscal year, Nordstrom now expects to generate a profit of between $2.80 and $2.95 per share. Anthony Adragna