Nordstrom Inc. (JWN), a leading fashion specialty retailer, reported fiscal 2009 fourth quarter earnings of $172 million or 77 cents per share compared to $68 million or 31 cents in the year-ago quarter. The quarterly earnings marginally missed the Zacks Consensus Estimate by a penny.

For fiscal 2009, Nordstrom reported earnings of $441 million or $2.01 per share versus $401 million or $1.83 per share in the previous fiscal year. The fiscal earnings beat the Zacks Consensus Estimate by 5 cents.

During the quarter, net sales increased 10.3% year-over-year to $2.54 billion, while total revenue rose 10.5% to $2.64 billion. The increase in sales was primarily due to an improved merchandise offering. Same-store sales during the quarter increased 6.9% compared to the year-earlier quarter, as most of the company’s merchandise categories generated positive same-store sales.

Same-store sales of Nordstrom Rack increased 4.6% in the fourth quarter compared with the same period in fiscal 2008. Gross profit of the company (as a percentage of net sales) increased approximately 530 basis points during the quarter due to improvement in merchandise margin. Furthermore, Nordstrom improved its inventory position during the quarter and ended the year with an inventory turn of 5.4, the highest in its recent history.

Selling, general and administrative expenses increased $56 million during the quarter due to higher expenses related to new store openings, and higher variable expenses. However, growth in revenues and higher gross margin more than offset the increase in operating expenses. Consequently, Nordstrom recorded a strong 98.7% growth in operating income to $310 million from $156 million in the year-ago period.

At year-end 2009, Nordstrom had cash and equivalents of $795 million and long-term debt of $2.3 billion, compared to $72 million of cash and $2.2 billion of long-term debt in the year-ago period. The company opened 3 full-line stores and 13 Nordstrom Rack stores since fourth quarter 2008 Incorporatedreasing its retail square footage by 0.9 million, or 4.1%.

During fiscal 2010, Nordstrom plans to open 3 full-line stores. The company expects same-store sales to increase 2.0% to 4.0% during fiscal 2010, with earnings in the range of $2.35 to $2.55 per share. Management further intends to continually align the key drivers of its business (inventory, expenses, working capital and capital expenditures) to improve its profitability and augment free cash flow during the next fiscal.

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