Nordstrom Reports $134M Net Earnings in 2023

Nordstrom, Inc. has recently released its 10-K report, revealing a net earnings of $134 million, or 0.9% of net sales, in 2023. The company reported a 5.8% decrease in total net sales compared to 2022, with Nordstrom's net sales decreasing by 8.2% and Nordstrom Rack's by 0.6%. Digital sales as a percentage of total net sales decreased by 10% compared to 2022.

The company's gross profit decreased by $157 million in 2023 compared to the previous year, primarily due to lower sales, partially offset by lower markdowns and lower buying and occupancy costs. The ending inventory as of February 3, 2024, decreased by 3% compared to January 28, 2023, reflecting continued strong inventory discipline.

Selling, general, and administrative expenses (SG&A) decreased by $191 million in 2023 compared to 2022, primarily due to lower variable costs driven by lower sales and supply chain efficiency initiatives, partially offset by higher labor costs and a $32 supply chain asset impairment and related charge.

The company recognized charges associated with the wind-down of Nordstrom Canada, totaling $284 million in the year ended February 3, 2024. Earnings Before Interest and Income Taxes (EBIT) decreased by $214 million and 130 basis points as a rate of net sales in 2023 compared to 2022, primarily due to expenses associated with the wind-down of Canadian operations, a supply chain asset impairment and related charge, and lower sales.

Interest expense, net, decreased by $24 million in 2023 compared to 2022, primarily due to an increase in interest income from higher prevailing rates. Income tax expense decreased to $13 million in 2023 with an effective tax rate of 8.6%, compared to $92 million and an effective tax rate of 27.2% in 2022.

In fiscal 2024, Nordstrom, Inc. expects a total revenue range, including retail sales and credit card revenues, of a 2% decline to 1% growth compared with the 53-week fiscal 2023, which includes an approximately 135 basis point unfavorable impact from the 53rd week. Today the company's shares have moved 0.1% to a price of $18.68. If you want to know more, read the company's complete 10-K report here.

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