UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) May 18, 2006
NORDSTROM, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
WASHINGTON 001-15059 91-0515058
(STATE OR OTHER JURISDICTION (COMMISSION FILE (I.R.S. EMPLOYER
OF INCORPORATION) NUMBER) IDENTIFICATION NO.)
1617 SIXTH AVENUE, SEATTLE, WASHINGTON 98101
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (206) 628-2111
INAPPLICABLE
(FORMER NAME OR FORMER ADDRESS IF CHANGED SINCE LAST REPORT)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions (see General Instruction A.2 below):
___ Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
___ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
___ Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
___ Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 2.02 Results of Operations and Financial Condition
On May 18, 2006, Nordstrom, Inc. issued an earnings release announcing
its results of operations for the quarter ended April 29, 2006, its financial
position as of April 29, 2006, and its cash flows for the quarter ended April
29, 2006. A copy of this earnings release is attached as Exhibit 99.1.
ITEM 7.01 Regulation FD Disclosure
On May 18, 2006, Nordstrom, Inc. issued an earnings release announcing
its results of operations for the quarter ended April 29, 2006, its financial
position as of April 29, 2006, and its cash flows for the quarter ended April
29, 2006. A copy of this earnings release is attached as Exhibit 99.1.
ITEM 9.01 Financial Statements and Exhibits
99.1 Nordstrom earnings release dated May 18, 2006 relating to
the Company's results of operations for the quarter ended April 29, 2006, its
financial position as of April 29, 2006, and its cash flows for the quarter
ended April 29, 2006.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
NORDSTROM, INC.
By: /s/ Michael G. Koppel
-----------------------
Michael G. Koppel
Executive Vice President and
Chief Financial Officer
Dated: May 18, 2006
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
99.1 Nordstrom earnings release dated May 18, 2006 relating to
the Company's results of operations for the quarter ended April 29, 2006, its
financial position as of April 29, 2006, and its cash flows for the quarter
ended April 29, 2006.
For Immediate Release
- ---------------------
May 18, 2006
NORDSTROM REPORTS FIRST QUARTER EARNINGS PER SHARE OF 48 CENTS
SEATTLE - May 18, 2006 - Nordstrom, Inc. (NYSE: JWN) today reported net
earnings of $131.2 million, or $0.48 per diluted share, for the first quarter
ended April 29, 2006. For the same period last year, net earnings and
earnings per diluted share were $104.5 million and $0.38, respectively.
Total sales for the first quarter of 2006 increased 8.0 percent to $1.8
billion, compared to sales of $1.7 billion in the same period last year.
First quarter same-store sales increased 5.4 percent.
FIRST QUARTER HIGHLIGHTS
Net earnings increased 25.5 percent in the first quarter compared to the
same quarter last year, reflecting continued progress in merchandise
execution, inventory management and expense control. The company remains
committed to providing a superior shopping experience and achieving long-term
profitable growth.
- Same-store sales increased 5.4 percent for the quarter, higher than the
company's one to three percent same-store sales guidance. Merchandise
divisions with performance above the company's average were accessories,
cosmetics and men's apparel.
- Gross profit, as a percent of sales, increased 40 basis points. Better
than plan sales resulted in incremental leverage on buying and occupancy
expenses, while overall merchandise margin remained flat versus last
year.
- The same-store sales increase combined with expense control resulted in a
48 basis point reduction in selling, general and administrative expenses
on a percent to sales basis. For the quarter, fixed expenses were
maintained at or below budgeted levels.
- We adopted SFAS No. 123(R), "Share-Based Payment," and as a result we
recorded compensation expense of $2.7 million in buying and occupancy
costs and $4.4 million in selling, general and administrative expenses.
EXPANSION UPDATE
During the first quarter Nordstrom opened one full-line store in Palm
Beach Gardens, Florida at the Gardens Mall on March 10th.
SHARE REPURCHASE
Nordstrom repurchased approximately 5.3 million shares of its common stock
during the first quarter for $212.9 million. This reduction in weighted-
average shares outstanding had no material impact on diluted earnings per
share for the quarter.
QUARTERLY DIVIDEND
The company's board of directors has approved a quarterly dividend of
$0.105 per share, payable on June 15, 2006, to shareholders of record on May
31, 2006.
2006 OUTLOOK
For the fiscal year ending February 3, 2007, the company anticipates
diluted earnings per share in the range of $2.24 to $2.32, which includes an
estimated expense of $0.06 per diluted share from the adoption of SFAS No.
123(R) regarding expensing of stock options. For the second quarter, the
company expects low single digit same-store sales growth and earnings per
share in the range of $0.59 to $0.64.
CONFERENCE CALL INFORMATION:
Company management will be hosting a conference call and webcast to
discuss first quarter results at 4:15 p.m. (ET) today. Access to the
conference call is open to the press and general public in a listen only mode.
To participate, please dial 212-547-0138 ten minutes prior to the call
(passcode: NORD). A telephone replay will be available for 48 hours beginning
approximately one hour after the conclusion of the call by dialing 866-463-
4967. Interested parties may also access the call over the Internet by
visiting the Investor Relations section of the company's corporate website at
http://about.nordstrom.com/aboutus/investor/webcasts.asp. An archived version
of the webcast will be available at this location for 30 days.
Nordstrom, Inc. is one of the nation's leading fashion specialty
retailers, with 156 US stores located in 27 states. Founded in 1901 as a shoe
store in Seattle, today Nordstrom operates 99 full-line stores, 49 Nordstrom
Racks, five Faconnable boutiques, one free-standing shoe store, and two
clearance stores. Nordstrom also operates 34 international Faconnable
boutiques in Europe. Additionally, Nordstrom serves customers through its
online presence at http://www.nordstrom.com and through its catalogs.
Nordstrom, Inc. is publicly traded on the NYSE under the symbol JWN.
Certain statements in this news release contain "forward-looking"
information (as defined in the Private Securities Litigation Reform Act of
1995) that involves risks and uncertainties, including anticipated results for
the fiscal year ending February 3, 2007 and the second quarter, store openings
and trends in company operations. Actual future results and trends may differ
materially from historical results or current expectations depending upon
factors including, but not limited to, the impact of economic and competitive
market forces, the impact of terrorist activity or the impact of a war on the
company, its customers and the retail industry, the company's ability to
predict fashion trends, consumer apparel buying patterns, trends in personal
bankruptcies and bad debt write-offs, changes in interest rates, employee
relations, the company's ability to continue its expansion plans, changes in
government or regulatory requirements, the company's ability to control costs,
weather conditions and hazards of nature. Our SEC reports, including our Form
10-K for the fiscal year ended January 28, 2006 and our Form 10-Q for the
quarter ended April 29, 2006 to be filed with the SEC, contain other
information on these and other factors that could affect our financial results
and cause actual results to differ materially from any forward-looking
information we may provide. The company undertakes no obligation to update or
revise any forward-looking statements to reflect subsequent events, new
information or future circumstances.
Investor Contact: Media Contact:
RJ Jones, 206-303-3007 Deniz Anders, 206-373-3038
NORDSTROM, INC.
CONSOLIDATED STATEMENTS OF EARNINGS - 1st Quarter
-----------------------------------------------------
(unaudited; amounts in thousands, except per share data and percentages)
Quarter % of sales (1) Quarter % of sales1
Ended (except as ended (except as
4/29/06 indicated) 4/30/05 indicated)
-------- ---------- -------- ---------
- -
Net sales $1,787,223 100.0% $1,654,474 100.0%
Cost of sales and related buying
& occupancy costs (1,123,003) (62.8%) (1,046,165) (63.2%)
--------- ---------
Gross profit 664,220 37.2% 608,309 36.8%
Selling, general and administrative
expenses (494,220) (27.7%) (465,422) (28.1%)
--------- ---------
Operating income 170,000 9.5% 142,887 8.6%
Interest expense, net (10,751) (0.6%) (12,639) (0.8%)
Other income including
finance charges, net 53,838 3.0% 42,732 2.6%
--------- ---------
Earnings before income tax expense 213,087 11.9% 172,980 10.5%
Income tax expense (81,856) (38.4%) (2) (68,442) (39.6%)
(2)
--------- ---------
Net earnings $131,231 7.3% $104,538 6.3%
========= =========
Earnings per share
Basic $0.49 $0.38
Diluted $0.48 $0.38
ADDITIONAL DATA
- ---------------
Weighted average shares outstanding
Basic 267,490 273,070
Diluted 272,831 278,395
(1) Subtotals and totals may not foot due to rounding.
(2) Percent of earnings before income taxes.
NORDSTROM, INC.
CONSOLIDATED BALANCE SHEETS
-----------------------------------------------------
(unaudited; amounts in thousands)
4/29/06 1/28/06 4/30/05
---------- ---------- ----------
Assets
Current assets:
Cash and cash equivalents $ 261,326 $ 462,656 $ 315,695
Short-term investments 30,000 54,000 53,750
Accounts receivable, net 619,095 639,558 629,788
Investment in asset backed securities 565,854 561,136 427,302
Merchandise inventories 1,078,750 955,978 1,016,640
Current deferred tax assets 161,001 145,470 114,127
Prepaid expenses and other 56,982 55,359 53,934
---------- ---------- ----------
Total current assets 2,773,008 2,874,157 2,611,236
Land, buildings and equipment, net 1,748,399 1,773,871 1,763,766
Goodwill 51,714 51,714 51,714
Acquired tradename 84,000 84,000 84,000
Other assets 129,518 137,607 108,891
---------- ---------- ----------
Total assets $ 4,786,639 $ 4,921,349 $ 4,619,607
========== ========== ==========
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $ 638,983 $ 540,019 $ 582,381
Accrued salaries, wages and related benefits 174,300 285,982 172,167
Other current liabilities 372,446 409,076 336,246
Income taxes payable 59,978 81,617 45,181
Current portion of long-term debt 306,636 306,618 100,458
---------- ---------- ----------
Total current liabilities 1,552,343 1,623,312 1,236,433
Long-term debt, net 624,949 627,776 928,175
Deferred property incentives, net 361,446 364,382 357,694
Other liabilities 219,477 213,198 204,353
Shareholders' equity:
Common stock, no par value: 1,000,000 shares
authorized; 265,741, 269,549 and 273,265
shares issued and outstanding 733,663 685,934 619,640
Unearned stock compensation - (327) (593)
Retained earnings 1,294,351 1,404,366 1,266,337
Accumulated other comprehensive earnings 410 2,708 7,568
---------- ---------- ----------
Total shareholders' equity 2,028,424 2,092,681 1,892,952
---------- ---------- ----------
Total liabilities and shareholders' equity $ 4,786,639 $ 4,921,349 $ 4,619,607
========== ========== ==========
NORDSTROM, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
-----------------------------------------------------
(unaudited; amounts in thousands)
Quarter Quarter
Ended Ended
4/29/06 4/30/05
---------- ---------
Operating Activities
Net earnings $ 131,231 $ 104,538
Adjustments to reconcile net earnings to net
cash provided by operating activities:
Depreciation and amortization of
buildings and equipment 70,425 69,204
Amortization of deferred property incentives
and other, net (8,677) (6,903)
Stock-based compensation expense 7,336 1,428
Deferred income taxes, net (7,395) 19,610
Tax benefit of stock option exercises and
employee stock purchases 13,538 16,546
Excess tax benefits from stock-based payments (11,617) -
Provision for bad debt 2,650 5,118
Change in operating assets and liabilities:
Accounts receivable 17,834 10,578
Investment in asset backed securities (7,927) (9,210)
Merchandise inventories (109,648) (99,065)
Prepaid expenses (1,410) 666
Other assets (572) 409
Accounts payable 91,905 97,507
Accrued salaries, wages and related benefits (111,343) (118,548)
Other current liabilities (34,126) (20,781)
Income taxes payable (21,639) (46,971)
Property incentives 3,826 9,839
Other liabilities 4,360 7,237
---------- ---------
Net cash provided by operating activities 28,751 41,202
---------- ---------
Investing Activities
Capital expenditures (47,513) (53,021)
Proceeds from sale of assets 18 -
Purchases of short-term investments (100,000) (165,500)
Sales of short-term investments 124,000 153,575
Other, net (1,941) (691)
---------- ---------
Net cash used in investing activities (25,436) (65,637)
---------- ---------
Financing Activities
Principal payments on long-term debt (1,124) (1,021)
Decrease in cash book overdrafts (1,807) (3,756)
Proceeds from exercise of stock options 18,657 39,139
Proceeds from employee stock purchase plan 8,370 8,640
Excess tax benefits from stock-based payments 11,617 -
Cash dividends paid (28,326) (17,758)
Repurchase of common stock (212,920) (47,746)
Other, net 888 2,009
---------- ---------
Net cash used in financing activities (204,645) (20,493)
---------- ---------
Net decrease in cash and cash equivalents (201,330) (44,928)
Cash and cash equivalents at beginning of period 462,656 360,623
---------- ---------
Cash and cash equivalents at end of period $ 261,326 $315,695
========== ==========
