US department store chain Nordstrom has disclosed its fourth quarter (Q4) financial results for the fiscal year 2024 (FY24), with revenue, comparable sales and profits aligning with or surpassing top-end projections.
Net sales in Q4 reached $4.20bn, a 2.1% decline compared to the corresponding period of the previous fiscal year.
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The company’s namesake brand experienced a 3.7% reduction in Q4 net sales, which transforms into a 0.5% increase upon adjusting for the additional week in the fiscal calendar.
The Nordstrom Rack brand saw a 1.2% rise in net sales for the same period.
The company’s digital sales fell 1.8% but showed a 2.6% increase when the impact of the 53rd week is excluded from the comparison with fiscal 2023.
Digital sales accounted for 38% of total sales in Q4 FY24.
During the quarter, Nordstrom’s gross profit margin expanded to 37.3%, up by 290 basis points from the previous year, driven primarily by enhanced merchandise margins due to markdown timing under cost accounting, improved shrinkage and reduced loyalty promotions.
Its operating expenses, represented as selling, general and administrative costs, rose to 34.4% of net sales – an increase of 200 basis points due to elevated labour expenses, privatisation fees and an accelerated charge for technology depreciation.
The company’s earnings before interest and taxes (EBIT) for the quarter stood at $242m in Q4 FY24, up from $215m in the same quarter of fiscal 2023. The EBIT margin was 5.8%.
In full year 2024, total revenue of Nordstrom, encompassing retail sales and credit card income, saw 2.2% growth or a 3.6% increase after excluding the additional week’s influence. Comparable sales also climbed by 3.6%.
The company’s net earnings for the concluded fiscal year were $294m with earnings per share of $1.74 and an EBIT of $495m.
Gross profit percent of net sales for the fiscal year improved to 35.5%, compared to 34.6% in the preceding year.
Nordstrom chief executive officer Erik Nordstrom stated: “Customers responded positively to the strength of our offering across both banners in the fourth quarter. We maintained the momentum we built throughout the year, which resulted in full-year sales and profitability coming in at the high end of our expectations.”
In December 2024, Nordstrom revealed that it had entered an agreement with Nordstrom family members and El Puerto de Liverpool to acquire all outstanding common shares not already under their ownership.
The transaction is set for completion in the first half of 2025 pending shareholder approval and other conditions, subsequently delisting Nordstrom’s common stock from public markets.
