Nordstrom Inc., impacted by declining revenues and charges related to the withdrawal from Canada, reported a net lack of $205 million in the primary quarter, in comparison with a profit of $20 million within the year-ago period.

For the primary quarter ended April 29, the Seattle-based retailer recorded $309 million of estimated pre-tax charges related to the wind-down of Canadian operations, consistent with its previously estimated range of $300 million to $350 million. The primary quarter 2023 results include Canadian operations through March 2, when it discontinued support for Nordstrom Canada. The corporate is early within the wind-down process and your entire shutdown of Nordstrom’s Canada operations — six shops, seven Rack units and e-commerce — needs to be accomplished this month.

Nordstrom’s loss before interest and tax was $259 million in the primary quarter of 2023, compared with EBIT of $73 million through the same period in fiscal 2022. Adjusted EBIT of $50 million in the primary quarter of 2023 excluded one-time charges of $309 million related to the wind-down of Canadian operations. Adjusted EBIT of $32 million in the primary quarter of 2022 excluded a $51 million gain on the sale of the corporate’s interest in a company office constructing and a $10 million impairment charge related to costs related to the wind-down of Trunk Club.

Net sales decreased 11.6 percent versus the identical period in fiscal 2022, including a 175 basis point negative impact from the wind-down of Canadian operations, and gross merchandise value decreased 11.9 percent. 

By division, Nordstrom banner net sales decreased 11.4 percent and GMV decreased 11.8 percent. Net sales for Nordstrom Rack fell 11.9 percent.

“We’re pleased with the progress we’re making against the important thing priorities we laid out for 2023 as we proceed to boost our overall customer experience, improve Nordstrom Rack performance, increase inventory productivity and optimize our supply chain operations,” Erik Nordstrom, chief executive officer, said in a press release Wednesday. “We’re encouraged by our momentum, especially given the uncertain macroeconomic environment. We remain focused on executing with agility and delivering long-term value to our shareholders.”

“Our deal with these key priorities allows us to higher serve our customers through great brands at great prices on the Rack and more product newness and higher flow across our banners, while also positioning us for more profitable growth,” added Pete Nordstrom, president and chief brand officer. “We’re grateful to our team for his or her labor and focus, and we’re excited to serve our customers with latest and fresh selections from the perfect brands at our upcoming Anniversary Sale.”

In after market trading, Nordstrom’s share price rose 7 percent, or $1.08, to $16.38, after being down 6 percent at market close. Investors apparently reacted favorably to the commentary on improving operations and the adjusted earnings per share of seven cents last quarter in comparison with a 6-cent loss per share a 12 months ago.

Most categories within the U.S. were down in the primary quarter versus 2022, which benefited from strong pent-up demand for a return to occasions after the pandemic. Energetic was the strongest category, while beauty and men’s apparel performed above average.

In a conference call with retail analysts and investors, Pete Nordstrom said designer was the hardest category. “Trends decelerated after strong demand through the pandemic, but designer sales remain above pre-pandemic levels. They’re normalizing after a giant run-up within the last two years. The high-end customer is resilient but additionally cautious. Men’s dress wear was the number-one volume driver.”

Erik Nordstrom in the decision said “Customer demand continues to be pressured under the present economic backdrop.” He cited the three key priorities for attaining improved profitability — the primary, improving Rack where the penetration of top-performing strategic brands is growing and the off-price division continues to open stores. Twenty units are being opened this 12 months.

The second priority cited was “managing with leaner and more current inventories” for improved sell-through which leads to gross margin increases.

The third priority is improving the availability chain via continuing reduced transportation costs and shorter delivery times to customers.

Digital sales decreased 17.4 percent compared with the identical period in fiscal 2022. The corporate reported that eliminating store success for Nordstrom Rack digital orders through the third quarter of fiscal 2022 and sunsetting Trunk Club earlier in fiscal 2022 negatively impacted first-quarter digital sales by about 800 basis points. Digital sales represented 36 percent of total sales through the quarter.

Ending inventory decreased 7.8 percent compared with the identical period in fiscal 2022, versus an 11.6 percent decrease in sales.

For this 12 months, Nordstrom expects revenues to say no, including retail sales and bank card revenues, by 4 to six percent versus fiscal 2022, including an about 250 basis point negative impact from the wind-down of Canadian operations and an roughly 130 basis point positive impact from the 53rd week.

At the tip of the quarter, Nordstrom Inc. has $1.4 billion in available liquidity and what executives described as a powerful balance sheet.