Nordstrom Q3 Profit Down, But Beats Street - Update

(RTTNews) - Luxury store chain Nordstrom Inc. (JWN), Thursday reported a drop in profit for the third quarter, hurt largely by a shift in timing of its anniversary sale and higher costs. Nevertheless, both earnings and revenues for the quarter came in ahead of Wall Street analysts' estimates. Moving ahead, the company also lifted the lower end of its full year earnings outlook.

Nordstrom said total revenues for the quarter grew 2.9 percent to $2.88 billion from $2.81 billion last year. Twenty-one analysts polled by Thomson Reuters estimated revenues of $2.87 billion for the quarter.

Total company same-store sales for the third quarter increased 0.1 percent. Slower same-store sale growth was negatively impacted by the shift in timing of Nordstrom's Anniversary Sale. The Anniversary Sale, which historically is the company's largest sale event of the year, took place fully in the second quarter this year, while last year it ran across both second and third quarter.

The high-end retailer said the estimated impact of this event shift reduced earnings for the third quarter by about $0.06 per share.

Seattle, Washington-based Nordstrom's third-quarter profit dropped to $137 million or $0.69 per share from $146 million or $0.71 per share last year. Analysts expected earnings of $0.66 per share for the quarter. Analysts' estimates typically exclude special items.

Third-quarter gross margins decreased 41 basis points due mainly to higher occupancy costs related to accelerated Rack store expansion, while selling, general and administrative expenses, as a percentage of sales, increased 65 basis points.

Looking forward to the full year 2013, the company now expect earnings of $3.65 to $3.70 per share and revenue growth of 3.5 percent. Analysts currently estimate earnings of $3.68 per share and sales growth of 3.6 percent.

Previously, the company expected earnings of $3.60 to $3.70 per share and revenue growth of 3 to 4 percent.

Nordstrom now sees same-store sales of about 2.5 percent for the full year compared to prior outlook of 2 to 3 percent.

JWN closed Thursday's regular trade at $63.43, up $0.05 or 0.08%, on the NYSE. The stock, however, shed $1.07 or 1.69% in after-hours trade.