Daily Newsletter

29 August 2023

Daily Newsletter

29 August 2023

Nordstrom registers 8.7% increase in Q2 net earnings 

The retailer’s net sales declined by 8.3% to $3.66bn.

Jangoulun Singsit August 25 2023

Department store chain Nordstrom has reported net earnings of $137m for the second quarter of fiscal year (FY) 2023, an increase of 8.7% compared with $126m a year ago.

The retailer’s earnings per diluted share (EPS) increased to $0.84 from $0.77 a year ago.

For the quarter ended 29 July 2023, the company’s gross profit, as a percentage of net sales, declined by 20 basis points (bps) to 35% from 35.2% last year. 

Nordstrom recorded net sales of $3.66bn during the quarter, down 8.3% from $3.99bn in the prior year's quarter, primarily due to the scaling down of its Canadian operation.

During the quarter, net sales of the Nordstrom and Nordstrom Rack banners decreased 10.1% and 4.1% respectively compared with the same period of last year.

Digital sales decreased 12.9% compared with the second quarter of last year.

Its selling, general and administrative (SG&A) expenses, as a percentage of net sales, remained flat at 32.8%, driven by the improvements in variable costs from supply chain efficiency initiatives and other factors.

The company’s earnings before interest and taxes (EBIT) were $192m, down from $202m in the same period a year ago.

The gross merchandise value (GMV) of Nordstrom also fell 8.5% during the quarter compared with the prior year's quarter.

Nordstrom CEO Erik Nordstrom said: "We've worked hard to improve our operating model and our solid results reflect the continued progress we made against our top priorities to improve Nordstrom Rack performance, increase inventory productivity and deliver efficiencies through supply chain optimisation.

"These 2023 priorities improve the way we operate and drive profitability in the near term and better position us to succeed and deliver value to our shareholders in the long-term. Looking ahead, we remain confident in our ability to deliver on these priorities, all while keeping the customer at the centre of everything we do."

APAC duty-free market expected to grow fastest, fueled by rising income levels and international travelers

Per latest GlobalData estimates, the global duty-free market retailing market was valued at $49 billion in 2022, its highest level ever as it bounced back from the pandemic impact, and is expected to grow at a CAGR of more than 28% during the period 2020-2026, driven by government initiatives, rising passenger numbers, major global events (for instance global sporting tournaments) and the renewed popularity of cruise trips. Infrastructure investments will also play an important role, particularly airport expansion and space refurbishment, and investments in arrivals duty-free formats.

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