Department store’ business rebounds in North America: Macy’s, Nordstrom and Dillard’s boost their profits in first quarter
After going through heavy adjustments and restructuring, the US distribution giants regained momentum and finished the first three months of the year with improved fiscal results.
Brick-and-mortar retailers regain momentum in the United States. After going through heavy adjustments and restructuring, the US distribution giants ended up the first quarter of 2018 with improved fiscal results. Three of them, Macy’s, Nordstrom and Dillard’s, boosted their net profits during the period with double-digit increases.
Macy’s boosted gains in the first quarter to 139 million dollars (117.7 million euros), up 78% compared to the same period of 2017. The company also posted a 3.5% rise in sales, from 5,350 million dollars (4,531.7 million euros) in Q1 2017 to 5,541 million dollars (4,693.5 million euros) in Q1 2018.
Jeff Gennette, the company’s chairman and CEO explained that results have exceeded expectations in all group chains, Macy’s, Bloomingdale's and Bluemercury. According to him, the group has strengthened its physical store network, improved ecommerce operations, worked towards an omnichannel strategy and now obtains a positive consumer response.
Macy’s net profit skyrocketed by 78% in Q1; Nordstrom, by 38%, and Dillard’s, with a 21.4% increase
Despite of a good start in the year, Macy’s remain cautious in their forecasts for fiscal 2018. According to the department store chain, the estimated sales evolution includes a broad span that goes from a 1% decrease to a 5% increase.
Nordstrom, on the other hand, has also increased its net profit in the first quarter of 2018. The grouped gained 87 million dollars (73.7 million euros), up 38% compared to the same period of 2017. The company’s revenue rose by 5.8%, from 3,279 million dollars (2,777.5 million euros) to 3,469 million dollars (2,938.4 million euros) in the first three months of 2018.
In early 2018, Nordstrom launched its first men’s-only store in New York, took the Nordstrom Rack chain to Canada and continued to shore up its online business. In fact, the group already generates 29% of revenues through digital channels.
Nordstrom has maintained an expansive strategy in this period, opening eight new stores and just one closure
Thus it has maintained an expansive strategy, opening eight stores and closing only one. Nordstrom emphasized as well that 64% of turnover comes from full-price sales, although they’ve fallen a 2.9% during the first quarter of 2018, while discounting grew up by 2.3%.
Eventually, Dillard’s posted a double-digit growth rate in profits, which stood at 80.5 million dollars (68.2 million euros), up 21.4%. Turnover increased as well, with a 2.7% upsurge to 1.45 billion dollars (1.23 billion euros).
William T. Dillard, Dillard’s CEO, explained that the economic climate favours consumption. At the end of the quarter, the chain operated with nearly 300 stores in the United States.
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