What: Neiman Marcus Group is transcending the volatile stock market and the nation’s sky-high inflation, and generating sales volumes and margin gains surpassing pre-covid-19 levels.

Why it is important: Neiman Marcus attributes their results largely to shoppers returning to stores, digital strength, robust full-price selling, adding luxury brands and exclusives to their offering, and a richer calendar of events “retail-tainment.”

Among the results that were made public, for their third fiscal quarter ended April 30, NMG reported:

• Comparable sales grew over 30 percent, beating pre-COVID-19 levels.
• Comparable gross merchandise value grew in the high 20 percent range compared to pre-pandemic 2019.
• Adjusted earnings before interest, taxes, depreciation and amortization margin expansion of over 300 basis points, compared to the 2019 quarter, and a 150-basis point expansion compared to last year’s quarter.
• Ample liquidity to invest in the business and no outstanding borrowings under the ABL facility.

Neiman Marcus is investing back in the business, including USD 300 million to renovate the Bal Harbour, Florida; Atlanta; White Plains, New York; St. Louis; Oak Brook, Illinois; Houston; Paramus, New Jersey; San Diego, and Tysons Galleria, Va. stores. The figure includes landlord and vendor contributions.

In several cases, men’s, shoe and handbag areas will be expanded, and several incoming brands require building dedicated shops. In some locations, bars and cafes will be added, and new restaurants in select stores are being considered. Food and beverage offerings encourage shoppers to stay longer in the store and buy more. In addition, beauty services will be enhanced, and fitting rooms will be enlarged.

Last year the company invested more than USD 200 million in technology initiatives such as Connect, a tool for associates to communicate with customers; the acquisition of Stylyze; the Neiman Marcus Stanley app, and Digital Labs. In addition, Neiman’s said it’s committed to spending more than USD 90 million to enhance its supply chain, including systems and fulfillment centers.

Neiman Marcus added over 600 new points of distribution with designers and brands in fiscal 2022, including over 200 brands for spring 2022, many of which were exclusive and had an ESG tie. He expects NMG to add another 140 points of distribution in fall 2022.

NGM’s performance reflects continued strong growth driven by their Revolutionizing Luxury Experiences strategy as well as a healthy U.S. luxury customer. They delivered comparable sales growth of over 30% and expanded EBITDA margin by over 150 basis points compared to this time last year, driven by strong full-price selling. While they continue to operate in a dynamic environment, they are well positioned for the future with their differentiated integrated luxury retail model, healthy balance sheet, and strong customer and luxury brand relationships.

Neiman Marcus Group tracks business above pre-covid-19 levels