Le Lézard
Classified in: Business
Subjects: ERN, ERP

Nordstrom Reports Fourth Quarter 2023 Earnings


SEATTLE, March 5, 2024 /PRNewswire/ -- Nordstrom, Inc. (NYSE: JWN) today reported fourth quarter net earnings of $134 million, or $0.82 per diluted share ("EPS"), for the 14-week quarter ended February 3, 2024. Excluding a supply chain asset impairment and related charge, the Company reported adjusted EPS of $0.96.1

For the 53-week fiscal year ended February 3, 2024, net earnings were $134 million and diluted EPS was $0.82, with earnings before interest and taxes ("EBIT") of $251 million, or 1.8 percent of sales. Excluding charges related to the wind-down of Canadian operations reported in the first and third quarters and a supply chain asset impairment charge in the fourth quarter, adjusted EBIT was $567 million, or 4.0 percent of sales, and adjusted EPS was $2.12 for fiscal 2023.1

For the fourth quarter, total Company net sales increased 2.2 percent versus the same period in fiscal 2022, inclusive of approximately $190 million related to the 53rd week, and gross merchandise value ("GMV") increased 2.0 percent. Nordstrom banner net sales decreased 3.0 percent and GMV decreased 3.4 percent compared with the fourth quarter of 2022. Net sales for Nordstrom Rack increased 14.6 percent.

"We delivered on our 2023 guidance and are confident in our expectations for continued sales improvement and sustained profitability in 2024," said Erik Nordstrom, chief executive officer of Nordstrom, Inc. "We're laser-focused on efforts we know will drive growth and profitability across the business over the next few years, including new Rack store openings, Nordstrom digital growth and increasing comp store sales. We have a strong team dedicated to building on our heritage of service, and we look forward to helping our customers feel good and look their best in the year ahead."

In the fourth quarter, active, beauty and women's apparel had the strongest growth versus 2022. For fiscal 2023, active and beauty had the strongest growth versus 2022.

"In 2023, we continued to make progress against the priorities we identified at the outset of the year to improve the customer experience and drive better financial results. Across both banners, we improved our merchandise assortment by effectively managing our inventory levels and investing in the products and brands we know our customers respond to," said Pete Nordstrom, president of Nordstrom, Inc. "This year, we'll build on that progress in merchandising and other green shoots across our business as we focus our efforts on our refreshed 2024 priorities."

As previously announced on February 28, 2024, the board of directors declared a quarterly cash dividend of $0.19 per share to be paid to shareholders of record at the close of business on March 12, 2024, payable on March 27, 2024.

FOURTH QUARTER 2023 SUMMARY

STORES UPDATE

During fiscal 2023, the Company opened or relocated 20 stores:

City


Location


Square Footage

(000s)


Timing of Opening

Nordstrom Rack







Los Angeles, CA


NOHO West


26


April 13, 2023

Clovis, CA


Clovis Crossing


31


April 13, 2023

Delray Beach, FL


Delray Place


26


May 11, 2023

Chattanooga, TN


The Terrace at Hamilton Place


24


May 18, 2023

Las Vegas, NV


Best in the West


31


May 18, 2023

Birmingham, AL


The Summit (relocation from River Ridge)


27


May 25, 2023

Wichita, KS


Bradley Fair


28


May 25, 2023

San Clemente, CA


San Clemente Plaza


32


May 25, 2023

Aurora, CO


Southlands


29


August 17, 2023

Olympia, WA


Cooper Point Marketplace


32


September 7, 2023

San Antonio, TX


Northwoods


35


September 7, 2023

Union Gap, WA


Valley Mall


28


September 14, 2023

Salem, OR


Willamette Town Center


25


September 21, 2023

Visalia, CA


Sequoia Mall


29


October 5, 2023

Denton, TX


Denton Crossing


25


October 5, 2023

Overland Park, KS


Overland Crossing


27


October 12, 2023

Allen, TX


The Village at Allen


29


October 19, 2023

San Luis Obispo, CA


SLO Promenade


24


October 26, 2023

Sacramento, CA


The Promenade at Sacramento Gateway


26


October 26, 2023

Anaheim Hills, CA


Anaheim Hills Festival


24


November 9, 2023

The Company has also announced plans to open the following stores:

City


Location


Square Footage

(000s)


Timing of Opening

Nordstrom Rack







Pinole, CA


Pinole Vista Crossing


23


Spring 2024

Kennesaw, GA


Barrett Place


25


Spring 2024

Elk Grove, CA


The Ridge Elk Grove


25


Spring 2024

Gilroy, CA


Gilroy Crossing


25


Spring 2024

Oceanside, CA


Pacific Coast Plaza


31


Spring 2024

Wheaton, IL


Danada Square East


29


Spring 2024

Snellville, GA


Presidential Markets


35


Spring 2024

Macedonia, OH


Macedonia Gateway


28


Spring 2024

Jacksonville Beach, FL


South Beach Regional


30


Spring 2024

Queen Creek, AZ


Queen Creek Marketplace


28


Spring 2024

Bay Shore, NY


Gardiner Manor Mall


24


Spring 2024

San Mateo, CA


Bridgepointe Shopping Center


36


Fall 2024

San Diego, CA


Clairemont Town Square


26


Fall 2024

Mason, OH


Deerfield Towne Center


30


Fall 2024

San Antonio, TX


Bandera Pointe


25


Fall 2024

Mooresville, NC


Mooresville Crossing


28


Fall 2024

Franklin, TN


Cool Springs Market


24


Fall 2024

Noblesville, IN


Hamilton Town Center


25


Fall 2024

Omaha, NE


Village Pointe


30


Fall 2024

Houston, TX


Meyerland Plaza


34


Fall 2024

Fort Myers, FL


Bell Tower


31


Fall 2024

Raleigh, NC


Triangle Town Place


32


Fall 2024

Davis, CA


The Davis Collection


25


Spring 2025

Matthews, NC


Sycamore Commons


25


Spring 2025

Geneva, IL


Randall Square


25


Spring 2025

Manalapan Township, NJ


Manalapan Commons


26


Spring 2025

The Company had the following store counts as of quarter-end:


February 3, 2024


January 28, 2023

Nordstrom




Nordstrom ? U.S.

93


94

Nordstrom ? Canada

?


6

Nordstrom Local service hubs

6


7

ASOS | Nordstrom

?


1

Nordstrom Rack




Nordstrom Rack ? U.S.

258


241

Nordstrom Rack ? Canada

?


7

Last Chance clearance stores

2


2

Total

359


358


Gross store square footage

26,259,000


27,571,000

During the fourth quarter, the Company closed one ASOS | Nordstrom store and one Nordstrom Rack store.

FISCAL YEAR 2024 OUTLOOK

The Company expects fiscal 2024 to be a year of continued momentum in its growth and profitability drivers, including opening new Rack stores, growing Nordstrom banner digital sales and driving comparable store sales across both banners. As such, the Company is providing the following financial outlook for fiscal 2024:

The 53rd week in fiscal 2023 creates a timing shift in the 4-5-4 calendar for fiscal 2024 that is expected to impact comparisons to the prior year.

CONFERENCE CALL INFORMATION

The Company's senior management will host a conference call to provide a business update and to discuss fourth quarter 2023 financial results and fiscal year 2024 outlook at 4:45 p.m. EST today. To listen to the live call online and view the speakers' prepared remarks and the conference call slides, visit the Investor Relations section of the Company's corporate website at investor.nordstrom.com. An archived webcast with the speakers' prepared remarks and the conference call slides will be available in the Quarterly Results section for one year. Interested parties may also dial 201-689-8354. A telephone replay will be available beginning approximately three hours after the conclusion of the call by dialing 877-660-6853 or 201-612-7415 and entering Conference ID 13744568, until the close of business on March 12, 2024.

ABOUT NORDSTROM

At Nordstrom, Inc. (NYSE: JWN), we exist to help our customers feel good and look their best. Since starting as a shoe store in 1901, how to best serve customers has been at the center of every decision we make. This heritage of service is the foundation we're building on as we provide convenience and true connection for our customers. Our interconnected model enables us to serve customers when, where and how they want to shop ? whether that's in-store at more than 350 Nordstrom, Nordstrom Local and Nordstrom Rack locations or digitally through our Nordstrom and Rack apps and websites. Through it all, we remain committed to leaving the world better than we found it.

Certain statements in this press release contain or may suggest "forward-looking" information (as defined in the Private Securities Litigation Reform Act of 1995) that involves risks and uncertainties that could cause results to be materially different from expectations. The words "will," "may," "designed to," "outlook," "believes," "should," "targets," "anticipates," "assumptions," "plans," "expects" or "expectations," "intends," "estimates," "forecasts," "guidance" and similar expressions identify certain of these forward-looking statements. The Company also may provide forward-looking statements in oral statements or other written materials released to the public. All statements contained or incorporated in this press release or in any other public statements that address such future events or expectations are forward-looking statements. Important factors that could cause actual results to differ materially from these forward-looking statements are detailed in the Company's Annual Report on Form 10-K for the fiscal year ended January 28, 2023, its Form 10-Qs for the fiscal quarters ended April 29, 2023, July 29, 2023 and October 28, 2023, and our Form 10-K for the fiscal year ended February 3, 2024, to be filed with the SEC on or about March 15, 2024. In addition, forward-looking statements contained in this release may be impacted by the actual outcome of events or occurrences related to the wind-down of business operations in Canada. These forward-looking statements are not guarantees of future performance and speak only as of the date made, and, except as required by law, the Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events, new information or future circumstances. In addition, the actual timing, price, manner and amounts of future share repurchases, if any, will be subject to the discretion of our board of directors, contractual commitments, market and economic conditions and applicable Securities and Exchange Commission rules.

1

Adjusted EBIT and adjusted EPS are non-GAAP financial measures. Refer to the "Adjusted EBIT, Adjusted EBITDA, Adjusted EBIT Margin and Adjusted EPS" section of this release for additional information as well as reconciliations between the Company's GAAP and non-GAAP financial results.

2

Adjusted EBIT and adjusted EBIT margin are non-GAAP financial measures. Refer to the "Adjusted EBIT, Adjusted EBITDA, Adjusted EBIT Margin and Adjusted EPS" section of this release for additional information as well as reconciliations between the Company's GAAP and non-GAAP financial results.

3

Comparable sales are calculated as GMV, excluding the impact of estimated adjustments for future customer returns and breakage from gift cards and Nordy Club points and Notes, for our digital platform and stores that have been open for over 13 full months and not closed during the period. The 53rd week is not included in comparable sales calculations.

 

NORDSTROM, INC.

CONSOLIDATED STATEMENTS OF EARNINGS

(unaudited; amounts in millions, except per share amounts)



Quarter Ended


Year Ended


February 3, 2024

January 28, 2023


February 3, 2024

January 28, 2023

Net sales

$4,293

$4,200


$14,219

$15,092

Credit card revenues, net

127

119


474

438

Total revenues

4,420

4,319


14,693

15,530

Cost of sales and related buying and occupancy costs

(2,815)

(2,807)


(9,303)

(10,019)

Selling, general and administrative expenses

(1,390)

(1,325)


(4,855)

(5,046)

Canada wind-down costs

?

?


(284)

?

Earnings before interest and income taxes

215

187


251

465

Interest expense, net

(26)

(27)


(104)

(128)

Earnings before income taxes

189

160


147

337

Income tax expense

(55)

(41)


(13)

(92)

Net earnings

$134

$119


$134

$245







Earnings per share:






Basic

$0.83

$0.75


$0.83

$1.53

Diluted

$0.82

$0.74


$0.82

$1.51







Weighted-average shares outstanding:






Basic

162.5

160.1


161.8

160.1

Diluted

164.6

161.6


163.4

162.1







Percent of net sales:






Gross profit

34.4 %

33.2 %


34.6 %

33.6 %

Selling, general and administrative expenses

32.4 %

31.5 %


34.2 %

33.4 %

Earnings before interest and income taxes

5.0 %

4.5 %


1.8 %

3.1 %

 

NORDSTROM, INC.

CONSOLIDATED BALANCE SHEETS

(unaudited; amounts in millions)



February 3, 2024

January 28, 2023

Assets



Current assets:



Cash and cash equivalents

$628

$687

Accounts receivable, net

334

265

Merchandise inventories

1,888

1,941

Prepaid expenses and other current assets

286

316

Total current assets

3,136

3,209




Land, property and equipment (net of accumulated depreciation of $8,251 and $8,289)

3,177

3,351

Operating lease right-of-use assets

1,359

1,470

Goodwill

249

249

Other assets

523

466

Total assets

$8,444

$8,745




Liabilities and Shareholders' Equity



Current liabilities:



Accounts payable

$1,236

$1,238

Accrued salaries, wages and related benefits

244

291

Current portion of operating lease liabilities

240

258

Other current liabilities

1,102

1,203

Current portion of long-term debt

250

?

Total current liabilities

3,072

2,990




Long-term debt, net

2,612

2,856

Non-current operating lease liabilities

1,377

1,526

Other liabilities

535

634




Commitments and contingencies






Shareholders' equity:



Common stock, no par value: 1,000 shares authorized; 162.4 and 160.1 shares issued

and outstanding

3,418

3,353

Accumulated deficit

(2,578)

(2,588)

Accumulated other comprehensive gain (loss)

8

(26)

Total shareholders' equity

848

739

Total liabilities and shareholders' equity

$8,444

$8,745

 

NORDSTROM, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited; amounts in millions)



Year Ended


February 3, 2024

January 28, 2023

Operating Activities



Net earnings

$134

$245

Adjustments to reconcile net earnings to net cash provided by operating activities:



Depreciation and amortization expenses

586

604

Canada wind-down costs

207

?

Asset impairment

30

80

Right-of-use asset amortization

184

185

Deferred income taxes, net

(60)

(83)

Stock-based compensation expense

52

59

Other, net

(71)

(46)

Change in operating assets and liabilities:



Merchandise inventories

(61)

265

Other current and noncurrent assets

(39)

(1)

Accounts payable

40

(190)

Accrued salaries, wages and related benefits

(42)

(94)

Lease liabilities

(272)

(269)

Other current and noncurrent liabilities

(67)

191

Net cash provided by operating activities

621

946




Investing Activities



Capital expenditures

(569)

(473)

Decrease in cash and cash equivalents resulting from Canada deconsolidation

(33)

?

Proceeds from the sale of assets and other, net

31

80

Net cash used in investing activities

(571)

(393)




Financing Activities



Proceeds from revolving line of credit

?

100

Payments on revolving line of credit

?

(100)

Change in cash book overdrafts

2

(14)

Cash dividends paid

(123)

(119)

Payments for repurchase of common stock

(1)

(62)

Proceeds from issuances under stock compensation plans

20

29

Other, net

(7)

(20)

Net cash used in financing activities

(109)

(186)




Effect of exchange rate changes on cash and cash equivalents

?

(2)

Net (decrease) increase in cash and cash equivalents

(59)

365

Cash and cash equivalents at beginning of year

687

322

Cash and cash equivalents at end of year

$628

$687

NORDSTROM, INC.
ADJUSTED EBIT, ADJUSTED EBITDA, ADJUSTED EBIT MARGIN
AND ADJUSTED EPS (NON-GAAP FINANCIAL MEASURES)
(unaudited; amounts in millions, except per share amounts)

The following are key financial metrics and, when used in conjunction with GAAP measures, we believe they provide useful information for evaluating our core business performance, enable comparison of financial results across periods and allow for greater transparency with respect to key metrics used by management for financial and operational decision-making. Adjusted EBIT, adjusted EBITDA, adjusted EBIT margin and adjusted EPS exclude certain items that we do not consider representative of our core operating performance. The financial measure calculated under GAAP which is most directly comparable to adjusted EBIT and adjusted EBITDA is net earnings. The financial measure calculated under GAAP which is most directly comparable to adjusted EBIT margin is net earnings as a percent of net sales. The financial measure calculated under GAAP which is most directly comparable to adjusted EPS is diluted EPS.

Adjusted EBIT, adjusted EBITDA, adjusted EBIT margin and adjusted EPS are not measures of financial performance under GAAP and should be considered in addition to, and not as a substitute for, net earnings, net earnings as a percent of net sales, operating cash flows, earnings per share, earnings per diluted share or other financial measures performed in accordance with GAAP. Our method of determining non-GAAP financial measures may differ from other companies' financial measures and therefore may not be comparable to methods used by other companies.

The following is a reconciliation of net earnings to adjusted EBIT and adjusted EBITDA and net earnings as a percent of net sales to adjusted EBIT margin:


Quarter Ended


Year Ended


February 3, 2024

January 28, 2023


February 3, 2024

January 28, 2023

Net earnings

$134

$119


$134

$245

Income tax expense

55

41


13

92

Interest expense, net

26

27


104

128

Earnings before interest and income taxes

215

187


251

465

Supply chain asset impairment and related charges

32

?


32

70

Canada wind-down costs

?

?


284

?

Trunk Club wind-down costs

?

?


?

18

Gain on sale of interest in a corporate office building

?

?


?

(51)

Adjusted EBIT

247

187


567

502

Depreciation and amortization expenses

156

151


586

604

Amortization of developer reimbursements

(17)

(17)


(69)

(72)

Adjusted EBITDA

$386

$321


$1,084

$1,034







Net sales

$4,293

$4,200


$14,219

$15,092

Net earnings as a % of net sales

3.1 %

2.8 %


0.9 %

1.6 %

EBIT margin %

5.0 %

4.5 %


1.8 %

3.1 %

Adjusted EBIT margin %

5.7 %

4.5 %


4.0 %

3.3 %

The following is a reconciliation of diluted EPS to adjusted EPS:


Quarter Ended


Year Ended


February 3, 2024

January 28, 2023


February 3, 2024

January 28, 2023

Diluted EPS

$0.82

$0.74


$0.82

$1.51

Supply chain asset impairment and related charges

0.19

?


0.19

0.44

Canada wind-down costs

?

?


1.74

?

Trunk Club wind-down costs

?

?


?

0.11

Gain on sale of interest in a corporate office building

?

?


?

(0.31)

Income tax impact on adjustments1

(0.05)

?


(0.63)

(0.06)

Adjusted EPS

$0.96

$0.74


$2.12

$1.69



1

The income tax impact of non-GAAP adjustments is calculated using the estimated tax rate for the respective non-GAAP adjustment.

NORDSTROM, INC.
SUMMARY OF NET SALES
(unaudited; amounts in millions)

Our Nordstrom brand includes Nordstrom.com, Nordstrom U.S. stores and Nordstrom Local. Nordstrom also included Canada operations prior to March 2, 2023, inclusive of Nordstrom.ca, Nordstrom Canadian stores and Nordstrom Rack Canadian stores, ASOS | Nordstrom prior to December 2023 and TrunkClub.com prior to October 2022. Our Nordstrom Rack brand includes NordstromRack.com, Nordstrom Rack U.S. stores and Last Chance clearance stores. The following table summarizes net sales for the quarter and year ended February 3, 2024, compared with the quarter and year ended January 28, 2023:


Quarter Ended


Year Ended


February 3, 2024

January 28, 2023


February 3, 2024

January 28, 2023

Net sales:






Nordstrom

$2,866

$2,955


$9,436

$10,279

Nordstrom Rack

1,427

1,245


4,783

4,813

Total net sales

$4,293

$4,200


$14,219

$15,092







Net sales (decrease) increase:






Nordstrom

(3.0 %)

(2.4 %)


(8.2 %)

6.6 %

Nordstrom Rack

14.6 %

(8.1 %)


(0.6 %)

1.1 %

Total Company

2.2 %

(4.1 %)


(5.8 %)

4.8 %







Digital sales as % of total net sales1

38 %

40 %


36 %

38 %



1

Sales conducted through a digital platform such as our websites or mobile apps. Digital sales may be self-guided by the customer, as in a traditional online order, or facilitated by a salesperson using a virtual styling or selling tool. Digital sales may be delivered to the customer or picked up in our Nordstrom stores, Nordstrom Rack stores or Nordstrom Local service hubs. Digital sales also includes a reserve for estimated returns.

NORDSTROM, INC.
ADJUSTED RETURN ON INVESTED CAPITAL ("ADJUSTED ROIC")
(NON-GAAP FINANCIAL MEASURE)
(unaudited; amounts in millions)

We believe that Adjusted ROIC is a useful financial measure for investors in evaluating the efficiency and effectiveness of the capital we have invested in our business to generate returns over time. In addition, we have incorporated it in our executive incentive measures and we believe it is an important indicator of shareholders' return over the long term. 

Beginning in the second quarter of 2023, the Adjusted ROIC calculation was updated to exclude certain items that we do not consider representative of our core operating performance. Refer to non-operating related adjustments included within adjusted net operating profit after tax and adjusted average invested capital. Prior periods have been modified to conform with current period presentation.

Adjusted ROIC is not a measure of financial performance under GAAP and should be considered in addition to, and not as a substitute for, return on assets, net earnings, total assets or other GAAP financial measures. Our method of calculating a non-GAAP financial measure may differ from other companies' methods and therefore may not be comparable to those used by other companies. The financial measure calculated under GAAP which is most directly comparable to Adjusted ROIC is return on assets. The following shows the components to reconcile the return on assets calculation to Adjusted ROIC:


Four Quarters Ended


February 3, 2024

January 28, 2023

Net earnings

$134

$245

Income tax expense

13

92

Interest expense

137

138

Earnings before interest and income tax expense

284

475




Operating lease interest1

86

85

Non-operating related adjustments2

316

38

Adjusted net operating profit

686

598

Adjusted estimated income tax expense3

(172)

(162)

Adjusted net operating profit after tax

$514

$436




Average total assets

$8,766

$9,069

Average noncurrent deferred property incentives in excess of operating lease right-of-use (ROU) assets4

(157)

(197)

Average non-interest bearing current liabilities

(2,954)

(3,185)

Non-operating related adjustments5

394

?

Adjusted average invested capital

$6,049

$5,687




Return on assets

1.5 %

2.7 %

Adjusted ROIC

8.5 %

7.7 %



1

Operating lease interest is a component of operating lease cost recorded in occupancy costs. We add back operating lease interest for purposes of calculating adjusted net operating profit for consistency with the treatment of interest expense on our debt.

2

Non-operating related adjustments primarily relate to the wind-down of our Canadian operations for the four quarters ended February 3, 2024 and supply chain impairment and related charges, partially offset by the gain on sale of our interest in a corporate office building for the four quarters ended January 28, 2023. See the Adjusted EBIT and Adjusted EBITDA section, as well as our 2022 Annual Report, for detailed information on certain non-operating related adjustments.

3

Adjusted estimated income tax expense is calculated by multiplying the adjusted net operating profit by the adjusted effective tax rate (which removes the impact of non-operating related adjustments) for the trailing twelve-month periods ended February 3, 2024 and January 28, 2023. The adjusted effective tax rate is calculated by dividing adjusted income tax by adjusted earnings before income taxes for the same trailing twelve-month periods.

4

For leases with property incentives that exceed the ROU assets, we reclassify the amount from assets to other current liabilities and other liabilities on the Consolidated Balance Sheets. The current and noncurrent amounts are used to reduce average total assets above, as this better reflects how we manage our business. 

5

Non-operating related adjustments primarily relate to the wind-down of our Canadian operations for the trailing twelve-month period ended February 3, 2024.

NORDSTROM, INC.
ADJUSTED DEBT TO EBITDAR (NON-GAAP FINANCIAL MEASURE)
(unaudited; dollars in millions)

Adjusted debt to earnings before interest, income taxes, depreciation, amortization and rent ("EBITDAR") is one of our key financial metrics and we believe that our debt levels are best analyzed using this measure, as it provides a reflection of our creditworthiness which could impact our credit ratings and borrowing costs. This metric is calculated in accordance with the updates in our Revolver covenant and is a key component in assessing whether our revolving credit facility is secured or unsecured, as well as our ability to make dividend payments and share repurchases. Our goal is to manage debt levels to achieve and maintain investment-grade credit ratings while operating with an efficient capital structure.

Adjusted debt to EBITDAR is not a measure of financial performance under GAAP and should be considered in addition to, and not as a substitute for, debt to net earnings, net earnings, debt or other GAAP financial measures. Our method of calculating a non-GAAP financial measure may differ from other companies' methods and therefore may not be comparable to those used by other companies. The financial measure calculated under GAAP which is most directly comparable to Adjusted debt to EBITDAR is debt to net earnings. The following shows the components to reconcile the debt to net earnings calculation to Adjusted debt to EBITDAR:


February 3, 2024

Debt

$2,862

Operating lease liabilities

1,617

Adjusted debt

$4,479



Four Quarters Ended February 3, 2024

Net earnings

$134

Income tax expense

13

Interest expense, net

104

Earnings before interest and income taxes

$251



Depreciation and amortization expenses

586

Operating lease cost1

278

Amortization of developer reimbursements2

69

Canada wind-down costs

284

Supply chain asset impairment and related charge

32

Other Revolver covenant adjustments3

36

Adjusted EBITDAR

$1,536



Debt to Net Earnings

21.4

Adjusted debt to EBITDAR

2.9



1

Operating lease cost is fixed rent expense, including fixed common area maintenance expense, net of developer reimbursement amortization.

2

Amortization of developer reimbursements is a non-cash reduction of operating lease cost and is therefore added back to operating lease cost for purposes of our Revolver covenant calculation.

3

Other adjusting items to reconcile net earnings to Adjusted EBITDAR as defined by our Revolver covenant include interest income, certain non-cash charges and other gains and losses where relevant. For the four quarters ended February 3, 2024, other Revolver covenant adjustments primarily included interest income.

NORDSTROM, INC.
FREE CASH FLOW (NON-GAAP FINANCIAL MEASURE)
(unaudited; amounts in millions)

Free Cash Flow is one of our key liquidity measures and, when used in conjunction with GAAP measures, we believe it provides investors with a meaningful analysis of our ability to generate cash from our business.

Free Cash Flow is not a measure of financial performance under GAAP and should be considered in addition to, and not as a substitute for, operating cash flows or other financial measures prepared in accordance with GAAP. Our method of calculating a non-GAAP financial measure may differ from other companies' methods and therefore may not be comparable to those used by other companies. The financial measure calculated under GAAP which is most directly comparable to Free Cash Flow is net cash provided by operating activities. The following is a reconciliation of net cash provided by operating activities to Free Cash Flow:


Year Ended


February 3, 2024

January 28, 2023

Net cash provided by operating activities

$621

$946

Capital expenditures

(569)

(473)

Change in cash book overdrafts

2

(14)

Free Cash Flow

$54

$459

 

INVESTOR CONTACT:


James Duies



Nordstrom, Inc.



[email protected]




MEDIA CONTACT:


Stephanie Corzett



Nordstrom, Inc.



[email protected]

 

Nordstrom Incorporated logo. (PRNewsFoto) (PRNewsfoto/Nordstrom, Inc.)

 

SOURCE Nordstrom, Inc.


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