Macy’s Fiscal Year Didn’t Live Up To Expectations

The fourth quarter at Macy’s showed some promise, but comps and earnings still slipped, as they did for the fiscal year.

For the fourth quarter, company net income was $340 million, or $1.09 per diluted share, versus $740 million, or $2.37 per diluted share in the year-earlier period. Adjusted for one-time events, company net income was $661 million, or $2.12 per diluted share, versus $850 million, or $2.73 per diluted share, in the year-prior quarter.

Macy’s topped a MarketBeat fourth quarter consensus analyst estimate of $1.84 per adjusted diluted share.

Comparable sales slipped 0.6% on an owned and 0.5% on an owned plus licensed basis in the period year over year. Net sales were $8.34 billion versus $8.46 billion in the year-previous quarter. Operating income was $559 million versus $1.05 billion in the year-before period.

For the full fiscal year, company net income was $564 million, or $1.81 per diluted share, versus $1.11 billion, or $3.56 per diluted share, in the year earlier. Adjusted company net income was $906 million, or $2.91 per diluted share, versus $1.3 billion, or $4.18 per diluted share, in the year prior.

Comps slid 0.8% on an owned and 0.7% on a owned plus licensed basis year over year. Net sales were $24.56 billion versus $24.97 billion in the year previous. Operating income was $970 million versus $1.74 billion in the year before.

“Taken as a whole, 2019 did not play out as we intended for Macy’s, Inc.,” said Jeff Gennette, the company’s chairman and CEO. “However, we executed well during the holiday 2019 season. We were pleased with the significant trend improvement in the fourth quarter, including a meaningful sales uptick in the 10 shopping days before Christmas. Together with disciplined expense management, our solid sales results in the fourth quarter allowed us to deliver stronger-than-expected earnings results. Importantly, we exited the year with a clean inventory position.”