Nordstrom’s net income slips in Q4; plans 31 new stores

Seattle – Holiday markdowns and costs associated with growing its Nordstrom Rack outlet brand and planned entry into Canada had a negative impact on net earnings at Nordstrom Inc. during fourth quarter 2013. Fourth quarter net earnings slipped 6% compared to the same quarter the prior year, to $268 million from $284 million.



Net earnings for the full fiscal year remained almost flat, slightly rising to $735 million from $734 million. Both earnings figures fell short of Wall Street expectations.



Nordstrom did better with its net sales results. For the quarter, net sales rose slightly to $3.61 billion from $3.59 billion, and for the year grew 3% to $12.16 billion from $11.76 billion. Same-store sales grew 2.2% during the quarter and 2.3% during the fiscal year. For fiscal 2014, Nordstrom expects total sales to grow 5.5 to 7.5% and same-store sales to rise 2 to 4%. For the first quarter, total sales are expected to rise 3.5 to 5.5%.



Looking ahead, Nordstrom plans to open 28 Nordstrom Rack stores and three full-line Nordstrom stores during fiscal 2014. In addition, the company expects its planned entry into Canada to continue to be dilutive to earnings, primarily due to ongoing infrastructure investments and pre-opening costs. The estimated loss before interest and taxes for Canada is expected to be approximately $35 million in fiscal 2014, compared with a loss before interest and taxes of $14 million in fiscal 2013. This outlook also incorporates Nordstrom Rack's accelerated store expansion and increased technology investments to improve service and experience across all channels.