Macy's Same-Store Sales Rise, Affirms Full-Year Outlook--Update
May 15 2019 - 9:42AM
Dow Jones News
By Aisha Al-Muslim
Macy's Inc. posted stronger-than-expected sales growth in the
latest period as the retailer said it benefited from more customers
making purchases through digital channels.
Sales at stores open at least a year grew 0.6% for the period
ended May 4, above the FactSet estimate of a 0.6% decrease.
Including licensed departments, same-store sales rose 0.7%.
Overall, the Cincinnati-based company reported Wednesday net
sales for the first quarter fell less than 1% to $5.5 billion.
The company posted a profit of $136 million, or 44 cents a
share, down from $139 million, or 45 cents a share, a year earlier.
Excluding impairment and other costs, adjusted earnings were 44
cents a share, higher than the 33 cents a share that analysts
polled by FactSet were looking for.
Macy's also affirmed its sales and earnings guidance for the
current fiscal year. The company expects net sales to be roughly
flat from the last fiscal year, with comparable sales to be flat to
up 1%. Excluding settlement charges, impairment and other costs,
the company forecasts adjusted earnings per share of $3.05 to
$3.25.
The stock rose more than 4% to $22.74 in premarket trading.
Shares are down 27% in the past year.
In February, Macy's signaled 2019 would be a challenging year,
predicting sales wouldn't grow and announcing another round of cost
cuts. The company said it would streamline senior management as
part of a plan to save $100 million a year, resulting in the
elimination of 100 jobs.
Last month, reports surfaced that Macy's might build an office
tower on top of its flagship Herald Square store in New York.
In April, Macy's said it would bring its Story concept shop to
36 stores in 15 states. Macy's acquired Story in May 2018, which at
the time was a New York City location with a rotating store design
and merchandise every four-to-eight weeks.
The retailer operates about 680 department stores under the
Macy's and Bloomingdale's names, and nearly 190 specialty stores
that include Bloomingdale's The Outlet, Bluemercury, Macy's
Backstage and Story.
Retailers could soon feel the pain as trade tensions rise. Last
week, 25% tariffs on more than $40 billion of goods that are
imported from China took effect, affecting clothing, luggage,
handbags and furniture, among other consumer products. In response,
merchants may have to decide whether to absorb the added costs of
the new tariffs themselves, spread them across their vendors or
pass them on to consumers.
The tariffs come as retailers' profit margins are already under
pressure as they spend on upgrading their digital capabilities and
remodeling their stores.
Write to Aisha Al-Muslim at aisha.al-muslim@wsj.com
(END) Dow Jones Newswires
May 15, 2019 09:27 ET (13:27 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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