Pedestrians go in entrance of a Nordstrom Inc. keep in the Midtown community of New York, on Friday, March 20, 2020.
Gabby Jones | Bloomberg by way of Getty Visuals
Nordstrom said Monday it is suspending its dividend, halting share buybacks and has drawn down $800 million on its revolving credit rating facility, in the midst of the coronavirus pandemic.
“We are proactively getting methods to strengthen our fiscal versatility to aid us navigate by means of this unparalleled problem,” CEO Erik Nordstrom mentioned in a statement.
Nordstrom said it “stays committed” to having to pay a dividend more than the very long phrase, and will determine out when it can resume payments “when correct.”
The Seattle-dependent section shop chain reported it ended 2019 with $853 million of hard cash on hand.
The business is now targeting reducing fees by additional than $500 million this yr, up from an original financial savings goal of $200 million to $250 million in fiscal 2020. “This incorporates ongoing initiatives to realign stock to income trends,” it mentioned.
Nordstrom included in its push launch that, “whilst there is no quick require to raise money at the present time, [it] intends to appraise accessing the financing markets and will seem to raise money, when and if the business deems it prudent, to even more fortify its stability sheet.”
Nordstrom experienced previously announced on March 17 that it would briefly shut its extra than 360 retailers all over the U.S., Canada and Puerto Rico for two weeks. When it made the announcement, Nordstrom also withdrew its 2020 earnings outlook.
The news from Nordstrom will come after Macy’s said Friday that it has absolutely drawn its $1.5 billion revolving credit facility. The division store chain reported it did so as a “proactive measure.”
Macy’s has also withdrawn its 2020 profits and earnings outlook, and is suspending its quarterly money dividend.
Kohl’s said final week that it has totally drawn its $1 billion unsecured credit score facility to improve its funds placement and “maintain its economical adaptability,” in the midst of so a lot uncertainty.
Kohl’s has also briefly suspended share buybacks and has withdrawn its earnings outlook for the present-day quarter and fiscal 12 months. Further, Kohl’s mentioned it is evaluating its dividend design.
Nordstrom, Macy’s and Kohl’s join a developing listing of merchants taking equivalent actions to test to maintain their organizations, as hundreds of outlets throughout the U.S., like total malls, have briefly absent dim.
J.C. Penney, Abercrombie & Fitch and L Models are amid the names that have withdrawn their outlooks, unclear what the long term will hold. Numerous are also tapping credit score lines for aid.
Nordstrom shares shut Monday down more than 12.5%, amid a broader market selloff. Its stock is down additional than 61% this year.