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Macy's Adds Sales But Cuts Guidance, Identifies Store Closures

Friday January 4th, 2013 - 1:56PM


In the five weeks ended December 29, 2012, Macy's, Inc. said total sales gained 3.6% to $5.1 billion versus the 2011 month as comparable store sales advanced 4.1% year over year. As it released sales figures, Macy’s also announced what it characterized as normal course store portfolio adjustments that include shuttering six locations.

A consensus analyst estimate for December comps was 4%.

In the November/December holiday timeframe, Macy’s noted, comps increased by 2.5% compared to the same period in 2011.

Online sales at macys.com and bloomingdales.com combined increased 51.7% in December. The retailer uses online sales in the comp calculation for Macy's, Inc.

"Last month was our fourth consecutive December with same-store sales growth, which is indicative of the sustainability of our key business strategies," said Terry Lundgren, Macy’s chairman, president and CEO. "While the rate of growth was somewhat less than we had expected in the first two months of the fourth quarter, it came amid some significant headwinds from uncertain economic news and the lingering effects of Hurricane Sandy. All said, we are proud of our accomplishments in driving growth this holiday season, and we believe we continued to gain market share.”

Macy’s announced that it expects earnings per diluted share for the fourth quarter to be in the range of $1.91 to $1.96, excluding costs associated with a previously announced debt tender offer and the impact of store closings. Previous guidance was in the range of $1.94 to $1.99 per diluted share, excluding those costs, the retailer said.

Macy’s locations subject to closure under the portfolio adjustment are Paseo, CO, Pasadena, CA, Belmont, MA, Downtown Honolulu, HI, Downtown St. Paul, MN and Downtown Houston. Macy’s also plans to shutter a Bloomingdales location, the Fashion Show Home Store, Las Vegas.

"We remain committed to operating a successful and growing stores business as part of our company's omnichannel strategy for serving customers wherever, whenever and however they prefer to shop," said Karen Hoguet, Macy's CFO. "This leads us to open new stores where we see the opportunity to fill gaps in important markets, as well as to make the tough decision to selectively close underperforming stores that no longer meet our performance requirements or where leases are not being renewed."

Macy's operates about 840 department stores in 45 of the United States, the District of Columbia, Guam and Puerto Rico under the names of Macy's and Bloomingdale's, as well as the macys.com and bloomingdales.com e-commerce websites. The company also operates 12 Bloomingdale's Outlet stores in the U.S. After it implements slated store adjustments, Macy's will operate 798 namesake stores in 45 states, the District of Columbia, Puerto Rico and Guam. Bloomingdale's will have a total of 37 full-line and home stores, as well as 13 Bloomingdale's Outlet stores.