What: The department store says it’s seeing a “rebound” in business, which is expressed to stakeholders in a confidential report with preliminary fiscal third-quarter results.

Why is it important: The report details a Q3 rebound in sales that challenges speculation on the state of its business since emerging from bankruptcy last September.

The report provides guidance on comparable fiscal third-quarter sales, indicating a 43 to 44% gain in the third quarter compared to the 2020 period, and a 6 to 7% decline from the third quarter of 2019. The report also indicates that Neiman’s USD 900 million asset-backed loan, led by Bank of America and a consortium of commercial banks, is fully undrawn.

In the recent months, the company has been dogged by speculation of declining support by certain vendors curbing wholesale distribution, switching to concession business models, and being outperformed by competitors, putting Neiman’s under steady scrutiny. The third-quarter report challenges some of the months of speculation on the state of the business.

Citing some trends, the report said see now, buy now and newness are selling, and that the company is working with brands to support that with more frequent merchandise drops. While women’s is generally still soft, the department store have seen a shift in women’s contemporary, bridal and swim indicating signs of a recovery More shorts were sold in February this year than in June last year. The uptick in women’s contemporary reflects women starting to get out and socialize. Men’s sneakers and the designer business are strong, and much of the men’s business is coming from younger customers.

NMG’s CEO sees “a real desire for luxury and we are capturing more share of that demand.…We finished Q2 and entered Q3 with much less inventory than prior years. Full-price selling is significantly up. We moved markdowns later, by four to six weeks. Historically we would have May markdowns. We moved them to June and July. We are promoting full price and it is working.” On the downside, tourism continues to be really nonexistent.

Though Neiman’s is presenting a brighter picture, it must significantly sustain revenue gains to manage its remaining debt and maintain solid relationships with vendors. NMG’s total revenues for its last fiscal year were USD 3.65 billion, compared to USD 4.66 billion the year before.

Neiman Marcus Group Cites Sales Rebound