Neiman Marcus's fiscal 2Q profit nearly doubles
DALLAS (AP) — Neiman Marcus Inc. saw earnings nearly double in its fiscal second quarter, as the luxury retailer benefited from holiday spending by its well-heeled customers. The company also got a boost from a decline in interest expense.
Like its upscale rivals, Neiman Marcus, based in Dallas, has seen consumer spending on luxury goods rebound since the recession as shoppers feel more comfortable about splurging on status goods.
The privately held retailer, which operates websites and stores under its namesake as well as one Bergdorf Goodman location in Manhattan, posted earnings of $40.1 million in the three months ended Jan. 28. That compares with $21 million in the year-ago period.
Revenue rose 9.2 percent to $1.28 billion from $1.17 billion in the year-ago period.
Revenue at stores opened at least a year rose 9.0 percent. The barometer is a key indicator of a retailer's health.
The company reported long-term debt of $2.68 billion, down 6.8 percent from $2.88 billion in the year-ago period.
Interest expense dropped 22 percent to $43.08 million in the period.
The debt is related to the company's $5.1 billion leveraged buyout by its current owners TPG Capital and Warburg Pincus LLC.
Meanwhile, Neiman Marcus is responding to the explosion of technology that's changing how shoppers are buying luxury goods.
It announced on Thursday it's testing this spring a new iPhone-only app in four markets —in Dallas and Austin, Texas, and in San Francisco and Palo Alto, Calif. — to help deepen relationships between its sales staff and shoppers.
Using the app, Neiman Marcus's clientele can find out immediately which of their favorite sales associates is in the store. In turn, when a customer checks in, sales associates are notified and can access information about the customer's buying history and cater to his or her needs. The customer also can get messages about upcoming events and new products. Even when they're not in the store, customers using the app can mark favorite products to show sales clerks.
Neiman Marcus has found that customers who shop with the same associate three times spend almost 10 times more than those who go to a random sales clerk, spokeswoman Ginger Reeder said.
