Nordstrom joins retail bloodbath

Even luxury department stores got no love from shoppers in the first quarter.



Following a pattern set by Macy’s and Kohl’s, Nordstrom reported dismal results for the first quarter, including a steep drop in profit, with the only positive sign being the company’s off-price division. The retailer lowered its full-year outlook.



Nordstrom posted net income of $46 million in the quarter ended April 30, down from $128 million in the year-ago period, amid lower than expected sales and higher markdowns.



Total company net sales increased 2.5% to $3.2 billion. Same-store sales decreased 1.7%.



Full-price net sales, which consist of U.S. full-line stores and Nordstrom.com, combined with Canada and Trunk Club, fell 2.2%. Same-store sales were down 4.3%. In the full-price sector, the top performing category was beauty, and the Midwest was the top-performing geographic region.



The retailer’s off-price division, however, was another, much more positive story. Off-price net sales, which consist of Nordstrom Rack stores and Nordstromrack.com/HauteLook, rose 11.8% and comparable sales increased 4.6%.



“Our first quarter results were impacted by lower than expected sales,” said Blake Nordstrom, co-president, Nordstrom. “In response we have made further adjustments to our inventory and expense plans. “As the pace of change in retail continues to accelerate, we remain committed to serving customers by taking steps that will continue to meet their expectations while driving profitable growth.”



Nordstrom cut its outlook for 2016 sales growth to 2.5- to 4.5%, from its previous guidance of 3.5- to 5.5%.



It expects same-store sales in a range of a 1% decrease to 1 percent%, down from a previous outlook of flat to 2% increase.