<page> Exhibit 99.1
For Immediate Release
- ---------------------
November 16, 2004
NORDSTROM THIRD QUARTER EARNINGS INCREASE 71 PERCENT
----------------------------------------------------
SEATTLE - November 16, 2004 - Nordstrom, Inc. (NYSE: JWN) today reported net
earnings of $77.8 million, or $0.54 per diluted share, for the third quarter
ended October 30, 2004, which was ahead of expectations. For the same period
last year, net earnings and earnings per diluted share were $45.5 million and
$0.33, respectively.
Total sales for the third quarter of 2004 increased 9.4 percent, to $1.5
billion, compared to sales of $1.4 billion in the same period last year.
Third quarter same-store sales increased 8.1 percent.
THIRD QUARTER HIGHLIGHTS
Earnings increased 71 percent in the third quarter compared to the same
quarter last year, as the company continues to focus on merchandising
improvements, inventory productivity and expense management. The better-than-
expected performance reflects ongoing operating improvements consistent with
the company's key strategic initiatives.
- Same-store sales increased 8.1 percent, better than the company's plan
of a low single digit increase. The company continues to see strong
customer response to fashion, color and newness across all categories
and price points.
- As a percent to sales, gross profit improved 80 basis points primarily
as a result of sales leverage on buying and occupancy expenses.
- Selling, general and administrative expenses decreased 90 basis points
compared to last year due to leverage on core operating expenses.
During the quarter, the company completed a review of its current and
deferred tax liabilities, which resulted in a lower effective tax rate. This
change increased net income per diluted share approximately $0.02 for the
quarter.
FULL YEAR RESULTS
Through October 30, 2004, year-to-date net earnings increased 83 percent to
$253.5 million compared to net earnings of $138.5 million for the same period
last year. Earnings per share for these periods were $1.77 and $1.01,
respectively.
Year-to-date total sales increased 11.1 percent to $5.0 billion compared to
prior year sales of $4.5 billion. Same-store sales increased 9.1 percent.
<page>
SHARE REPURCHASE
As part of its recently announced share repurchase program, Nordstrom
repurchased 2 million shares of common stock during the third quarter for a
total of $75 million. This did not materially impact earnings per share for
the quarter, as the impact on weighted average shares outstanding was
insignificant.
EXPANSION UPDATE
During the third quarter Nordstrom did not open any stores. The final new
store planned for this year opened November 12th at Dadeland Mall in Miami,
increasing gross square footage for the year approximately 2 percent to
19,439,000.
2004 OUTLOOK
The company is providing the following fourth quarter forecast as well as
raising full-year expectations to $2.68 - $2.73 from the previously stated
forecast of $2.46 -$2.50:
<table>
<caption>
4th Quarter 2004 Full-Year 2004
---------------- --------------
<s> <c> <c>
Comp-store Sales 1%-3% increase 6%-8% increase
Gross Profit (%) 25-35 basis point increase 140-150 basis point increase
Selling, General and
Administrative Expense (%) 120-130 basis point decrease 90-100 basis point decrease
Service Charge Income ($) $2-$3 million increase $15-$16 million increase
Interest Expense $4-$5 million decrease $13-$14 million decrease
Effective Tax Rate 38.4% 38.3%
Earnings per Share $0.90 - $0.95 $2.68 - $2.73
Diluted Shares Outstanding 142.2 142.7
Prior Year Diluted EPS $0.74 $1.76
</table>
CONFERENCE CALL INFORMATION:
Company management will be hosting a conference call and webcast to discuss
third quarter results at 4:30p.m. (EST) today. Access to the conference call
is open to the press and general public in a listen only mode. To
participate, please dial, 1-212-547-0138 ten minutes prior to the call
(passcode: NORD). A telephone replay will be available for 48 hours beginning
approximately one hour after the conclusion of the call by dialing 866-415-
2343. Interested parties may also access the call over the Internet by
visiting the Investor Relations section of the company's corporate website at
http://about.nordstrom.com/aboutus/investor/webcasts.asp. An archived version
of the webcast will be available at this location for 30 days.
<page>
GAAP SALES PERFORMANCE
The additional information provided in this section is to comply with the
Securities and Exchange Commission's Regulation G. The company converted to a
4-5-4 Retail Calendar at the beginning of 2003. Year-to-date results for 2003
include one more day than the year-to-date for 2004. The company believes
that adjusting for this difference provides a more comparable basis from which
to evaluate sales performance. The following reconciliation bridges the year-
to-date 2003 GAAP sales to the 4-5-4 comparable sales.
<table>
<caption>
Dollar % Change % Change
Sales Reconciliation ($M) YTD 2003 YTD 2004 Increase Total Sales Comp Sales
-------- -------- ---------- ----------- ----------
<s> <c> <c> <c> <c> <c>
Number of Days GAAP 274 273
GAAP Sales $4,529.4 $5,031.0 $501.6 11.1% 8.6%
Less Feb. 1, 2003 sales ($18.2) ---
--------- -------
Reported 4-5-4 sales $4,511.2 $5,031.0 $519.8 11.5% 9.1%
======== ========
4-5-4 Adjusted Days 273 273
</table>
Nordstrom, Inc. is one of the nation's leading fashion specialty retailers,
with 150 US stores located in 27 states. Founded in 1901 as a shoe store in
Seattle, Nordstrom today operates 94 full-line stores, 49 Nordstrom Racks,
five U.S. Faconnable boutiques, one freestanding shoe store, and one clearance
store. Nordstrom also operates 31 international Faconnable boutiques,
primarily in Europe. Additionally, Nordstrom Direct serves customers through
its online presence at http://www.nordstrom.com and through its direct mail
catalogs.
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,
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 company's ability to
predict fashion trends, consumer apparel buying patterns, the company's
ability to control costs, weather conditions, hazards of nature, 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 and the impact of economic
and competitive market forces, including the impact of terrorist activity or
the impact of a war on the company, its customers and the retail industry.
Our SEC reports may 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.
<page>
NORDSTROM, INC.
CONSOLIDATED STATEMENTS OF EARNINGS - 3rd Quarter
-------------------------------------------------
(unaudited; amounts in thousands, except per share data and percentages)
<table>
<caption>
Quarter % of sales Quarter % of sales
ended (except as ended (except as
10/30/04 indicated) 11/1/03 indicated)
------ --------- ------ ---------
<s> <c> <c> <c> <c>
Net sales $1,542,075 100.0% $1,409,109 100.0%
Cost of sales and related buying
& occupancy costs (984,908) (63.9%) (911,429) (64.7%)
--------- ---------
Gross profit 557,167 36.1% 497,680 35.3%
Selling, general and administrative
expenses (465,769) (30.2%) (439,006) (31.1%)
-------- --------
Operating income 91,398 5.9% 58,674 4.2%
Interest expense, net (13,485) (0.9%) (26,681) (1.9%)
Service charge income
and other, net 45,000 3.0% 42,576 3.0%
-------- --------
Earnings before income taxes 122,913 8.0% 74,569 5.3%
Income tax expense (45,085) (36.7%)(1) (29,100) (39.0%)(1)
-------- --------
Net earnings $77,828 5.0% $45,469 3.2%
======== ========
Earnings per share
Basic $ 0.55 $ 0.33
Diluted $ 0.54 $ 0.33
</table>
ADDITIONAL DATA
- ---------------
Average number of shares outstanding
<table>
<caption>
<s> <c> <c>
Basic 140,698 136,304
Diluted 143,149 138,103
</table>
<page>
NORDSTROM, INC.
CONSOLIDATED STATEMENTS OF EARNINGS - Year-to-Date
--------------------------------------------------
(unaudited; amounts in thousands, except per share data and percentages)
<table>
<caption>
Year-to-Date % of sales Year-to-Date % of sales
ended (except as ended (except as
10/30/04 indicated) 11/1/03 indicated)
------ --------- ------ ---------
<s> <c> <c> <c> <c>
Net sales $5,031,045 100.0% $4,529,430 100.0%
Cost of sales and related buying
& occupancy costs (3,228,732) (64.2%) (2,991,953) (66.1%)
--------- ---------
Gross profit 1,802,313 35.8% 1,537,477 33.9%
Selling, general and administrative
expenses (1,454,736) (28.9%) (1,351,628) (29.8%)
-------- --------
Operating income 347,577 6.9% 185,849 4.1%
Interest expense, net (64,260) (1.3%) (73,043) (1.6%)
Service charge income
and other, net 127,489 2.6% 114,289 2.5%
-------- --------
Earnings before income taxes 410,806 8.2% 227,095 5.0%
Income tax expense (157,336) (38.3%)(1) (88,600) (39.0%)(1)
-------- --------
Net earnings $253,470 5.0% $138,495 3.1%
======== ========
Earnings per share
Basic $ 1.81 $ 1.02
Diluted $ 1.77 $ 1.01
</table>
ADDITIONAL DATA
- ---------------
Average number of shares outstanding
<table>
<caption>
<s> <c> <c>
Basic 140,181 135,907
Diluted 142,868 136,659
</table>
Investor Contact: Media Contact:
Stephanie Allen, 206-303-3262 Deniz Anders, 206-373-3038
(1)Percent of earnings before income taxes. For third quarter and year-to-
date 2004, the company's effective tax rate has been updated based on a review
of current and deferred tax liabilities.