Nordstrom achieves record sales for fiscal year 2010
Nordstrom Inc reported net earnings of $232 million, or $1.04 per diluted share, for the fourth quarter ended January 29, 2011. This represented an increase of 35 percent compared with net earnings of $172 million, or $0.77 per diluted share, for the same quarter last year.
Fourth quarter same-store sales increased 6.7 percent compared with the same period in fiscal 2009. Net sales in the fourth quarter were $2.82 billion, an increase of 10.9 percent compared with net sales of $2.54 billion during the same period in fiscal 2009. Additionally, total net sales of $9.31 billion for fiscal 2010 were the highest in the company's history.
Nordstrom's fourth quarter performance was a continuation of the positive trends experienced during 2010.
Multi-channel same-store sales increased 7.2 percent compared with the same period in fiscal 2009. Top-performing multi-channel merchandise categories included jewelry, dresses and shoes. The South and Midwest regions were the top-performing geographic areas for full-line stores relative to the fourth quarter of 2009.
Nordstrom Rack net sales increased $93 million, or 24.1 percent compared with the same period in fiscal 2009. Same-store sales increased 3.9 percent compared with the same period in fiscal 2009.
Gross profit, as a percentage of net sales, increased 34 basis points compared with last year's fourth quarter. The improvement was mainly driven by the ability to leverage buying and occupancy expenses during the quarter. The company ended the quarter with sales per square foot up 6.0 percent and inventory per square foot up 3.8 percent compared with the fourth quarter of 2009. Nordstrom ended the year with inventory turn of 5.6, an all-time high for the company.
Retail selling, general and administrative expenses increased $66 million compared with last year's fourth quarter. Higher sales volume and new stores accounted for the majority of this increase, with the remainder coming primarily from increased investments in marketing and technology. The company continues to make investments to improve the customer experience both online and within the stores.
The Credit segment continues to improve. Customer payment rates are increasing, resulting in improved delinquency and write-off trends. Delinquencies as a percentage of credit card receivables at the end of the fourth quarter were 3.0 percent, which was reduced from 3.5 percent at the end of the third quarter of 2010 and reduced from 5.3 percent at the end of the fourth quarter of 2009. As a result, the reserve for bad debt was reduced by $15 million.
Earnings before interest and taxes increased $96 million to $406 million, or 13.9 percent of total revenues, from $310 million, or 11.8 percent of total revenues, in last year's fourth quarter.
For the fiscal year ended January 29, 2011, net earnings were up $172 million to $613 million, an increase of 39 percent comparedwith net earnings of $441 million for the fiscal year ended January 30, 2010. Earnings per diluted share for the same periods were $2.75 and $2.01, respectively.