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Nordstrom shares rise as retailer’s earnings top estimates

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Pedestrians pass in front of a Nordstrom Inc. store in the Midtown neighborhood of New York, on March 20, 2020.

Gabby Jones | Bloomberg | Getty Images

Nordstrom shares got a lift Tuesday after the department store reported that its third-quarter sales picked up more than analysts had anticipated, suggesting it might have a stronger holiday season than some investors expected if trends continue.

Nordstrom shares were up more than 4% in extended trading Tuesday.

Nordstrom CEO Erik Nordstrom said the retailer has made strides with its online business, especially since its stores were temporarily shuttered. Digital sales in the three-month period were $1.6 billion and represented 54% of the retailer’s business.

He said the company is “continuing to amplify categories that are relevant with customers during the pandemic, such as activewear and wellness products. Yet he said it’s also looking toward the future with the Covid-19 vaccine and anticipates “pent-up customer demand, particularly around occasions like travel or in-person social events.”

He said the retailer’s off-price store, Nordstrom Rack, could be a major growth driver because it’s one of the few in this category with a large online presence. The company will expand its inventory, particularly at the lower price point, he said.

Here’s how the company did in the fiscal third quarter ended October 31, compared to what analysts were expecting, based on Refinitiv data:

  • Earnings per share: 34 cents vs. a loss of 6 cents expected
  • Revenue: $3.09 billion vs. $3.10 billion expected

Nordstrom said its net income fell to $53 million, or 34 cents per share, from $126 million, or 81 cents per share, a year earlier. Analysts surveyed by Refinitiv on average had expected the company to post a loss of 6 cents per share.

Total revenue for the company fell to $3.09 billion from $3.67 billion a year ago, and was lower than the $3.10 billion that analysts were expecting.

Nordstrom was among the retailers that were forced to close their doors in the early days of the coronavirus pandemic. Total sales were down 40% in the first quarter and 53% in the second quarter compared with the same period a year earlier.

In the third quarter, total sales were down only 16%. That includes an approximately 10-percentage point impact from the Anniversary Sale.

“Our Anniversary Sale serves as a strong proof point in our ability to amplify relevant categories, brands and trends to meet shifting customer preferences,” Chief Financial Officer Anne Bramman said during a conference call.

During the quarter, the company said its top performing merchandise categories were activewear, home, beauty and designer.

On the conference call, Bramman said the company expects sales to decrease in the low 20-percentage range in the fourth quarter. But the company expects to deliver positive operating cash flow, she said.

Yet she acknowledged the outlook is uncertain because of the pandemic and said that its expectations are based on stores remaining open.

Read the full earnings release here.


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Democratic governors accuse Trump administration of misleading them about vaccine stockpile

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Several Democratic governors are criticizing the Trump administration for apparently misleading public health officials about holding a stockpile of Covid-19 vaccines in reserve.

Health and Human Services Secretary Alex Azar said on Tuesday that the government would begin releasing doses of vaccine that were being held in “physical reserve” to ensure enough supply for second doses.

Both federally approved vaccines, made by Pfizer and Moderna, are administered in two shots spaced several weeks apart.

The Washington Post reported on Friday that despite Azar’s comments, no such federal stockpile of vaccines exists. The newspaper, citing state and federal officials, said the Trump administration had already started shipping its available supply in December.

The Democratic state leaders say the lack of a federal reserve will upset plans to increase the speed and scope of their vaccination campaigns.

“Last night, I received disturbing news, confirmed to me directly by General Perna of Operation Warp Speed: States will not be receiving increased shipments of vaccines from the national stockpile next week, because there is no federal reserve of doses,” Oregon Gov. Kate Brown wrote in a post on Twitter, referring to Army Gen. Gus Perna, the chief operating officer of Operation Warp Speed.

“This is a deception on a national scale,” Brown added. “Oregon’s seniors, teachers, all of us, were depending on the promise of Oregon’s share of the federal reserve of vaccines being released to us.”

Washington Gov. Jay Inslee, a Democrat, also took to the platform, saying that the administration “must answer immediately for this deception.”

“I’m shocked we were lied to and there is no national reserve,” Colorado Gov. Jared Polis, a Democrat, wrote on Twitter.

He said that the federal announcement about the stockpile release “led us to expect 210,000 doses next week” and that other governors had made similar plans.

“Now we find out we’ll only get 79,000 next week,” Polis wrote.

Gov. Tim Walz of Minnesota, a Democrat, said at a press conference that “they were lying,” referring to the federal government.

Walz and Democratic Govs. Gretchen Whitmer of Michigan and Tony Evers of Wisconsin said in a joint statement on Friday that “it has become abundantly clear that not only has the Trump administration botched the rollout of the safe and effective COVID-19 vaccine, but also that the American people have been misled about these delays.”

The governors requested permission to purchase vaccines directly from manufacturers.

“Without additional supply or authorization to purchase directly, our states may be forced to cancel plans for public vaccination clinics in the coming weeks, which are expected to vaccinate tens of thousands. It’s time for the Trump administration to do the right thing and help us end this pandemic,” the governors wrote.

Azar responded to the governors in a thread on Twitter on Saturday, calling their claims “completely misleading” and a “debasement.”

“We had a stockpile of reserved second doses from December. We started releasing those second doses at the end of December so people could get their second doses. We progressively continued that release,” Azar wrote.

The HHS chief said that the announcement this week “was that we are releasing the remaining reserved second doses according to the established cadence—ensuring second doses would be available at the right interval—and that going forward we’d no longer have a reserve of second doses.”

“The effort of some governors to mislead the American people to distract from their own distribution failures is unfortunate,” Azar said, referencing data that showed that Michigan, Oregon and Wisconsin had yet to administer the bulk of the vaccines that had already been distributed to those states.

The Trump administration has sparred with Democratic state officials since the beginning of the Covid-19 crisis, at first over supplies of tests and other medical equipment and more recently over vaccine distribution.

President-elect Joe Biden, who will be inaugurated Wednesday, has pledged to elevate the role of the federal government in vaccine delivery. Biden has pledged to have 100 million doses of vaccine administered in his first 100 days in office.

To date, vaccination efforts have lagged far behind official predictions. According to the Centers for Disease Control and Prevention, about 12 million doses have been administered. Health officials had hoped to get that number to 20 million by January.

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Close coffee shops and nurseries during lockdown, voters say in new poll | Coronavirus

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Most people now believe takeaway coffee shops, cafes and children’s nurseries should be closed in a further tightening of the national lockdown, according to the latest Opinium poll for the Observer.

A majority of voters also think lockdown rules should be tightened on outside exercise with a ban on people walking or exercising with anyone from a different household.

The findings are in line with a growing view among voters that the government is not responding fast or strongly enough to the virus.

The proportion who think ministers are under-reacting is now 51% (+7 points) compared with a week ago, while the proportion who think they haven’t reacted quickly enough is 75%, (up 3) on last week and the highest Opinium has recorded. This latter figure includes 60% of people who voted Conservative at the last general election in December 2019.

Some 51% believe takeaway coffee shops and cafes should close while 61% say it is time for nurseries to shut. There are broadly similar majorities in favour of tighter rules on outside exercise (53%), with 55% supporting the suspension of click and collect services in all but essential shops.

Labour holds a four-point lead over the Conservatives in the latest poll, on 41% (up 1 point on a week ago) with the Tories on 37% (-2). This is the joint highest lead Opinium has recorded for Labour since the last election. The Liberal Democrats and SNP are on 6%, the Green Party on 4%, and Plaid Cymru on 1%.

Johnson has also recorded his lowest score on Opinium’s “best prime minister” tracker, with just 29% picking him against 32% who would prefer Labour leader Keir Starmer. Johnson also records his lowest net approval since the last general election in December 2019, at -14 (34% approve while 49% disapprove).

Starmer’s net approval has also dropped since last week from +15 to +10 now. Just 37% approve of the job he is doing as Labour leader, with 27% disapproving.

Adam Drummond of Opinium said: “One of the consistent themes of this pandemic has been a government which is petrified of being punished by the voters for putting in place too many restrictions, and a public crying out for further restrictions because they are petrified of the spread of the virus.

“The data from this week’s poll is probably the most extreme example of this trend, and perhaps one of the reasons why we have seen such a drop in support for the government.”

Just 30% (-1) now approve of how the government has handled Coronavirus, compared to 50% (+2) who disapprove.


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U.S. health officials push hospitals to administer unused Covid antibody drugs

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U.S. health officials push hospitals to administer unused Covid antibody drugs