Macy's increases full-year earnings guidance

14 Nov '11

6 min read

Macy's Inc. reported strong third quarter earnings that reflect ongoing sales growth and success in implementing the company's key business strategies. Earnings were 32 cents per diluted share for the third quarter of 2011, ended Oct. 29, 2011. This compares with earnings of 2 cents per diluted share in last year's third quarter, or 8 cents per diluted share in last year's third quarter excluding expenses of 6 cents per share associated with the repurchase of debt.

"A number of factors contributed to this excellent third quarter performance. We continue to move forward in the execution of those strategies that have created a culture of growth at Macy's - including My Macy's localization of our assortments and shopping experience; omnichannel integration across stores, online and mobile; and MAGIC Selling and associate coaching programs to strengthen customer engagement.

Bloomingdale's also enjoyed a strong quarter, both in stores and online, as customers have continued to respond to bridge and designer merchandise. In addition, third quarter results benefitted from a strong credit performance due to improved portfolio quality," said Terry J. Lundgren, chairman, president and chief executive officer of Macy's, Inc.

"Our team is very excited about plans for the upcoming holiday selling season. A customer-centric approach to the business at Macy's and Bloomingdale's has led to an outstanding assortment of distinctive fashion product. Our stores look great. Our online sites, as well as our mobile-enhanced websites and apps, provide a robust and convenient complement to the active lifestyles of shoppers.

"The quality and creativity of our marketing support for holiday is the strongest ever," Lundgren said. "You can feel the momentum and confidence that has been building at Macy's since our organizational changes in 2009, and especially over the past nine months. We believe this will help us to continue to capture market share in the fourth quarter and lay the foundation for continued innovation in our business in 2012."

For the first three quarters of 2011, Macy's, Inc.'s diluted earnings per share were $1.18, compared with earnings of 42 cents per diluted share in the first three quarters of 2010. Excluding 10 cents per share of expenses associated with the repurchase of debt in the first and third quarters of 2010, earnings were 52 cents per diluted share in the first three quarters of 2010.

Sales
Sales in the third quarter totaled $5.853 billion, up 4.1 percent from total sales of $5.623 billion in the third quarter of 2010. On a same-store basis, Macy's, Inc.'s third quarter sales were up 4.0 percent.

For the year to date, Macy's, Inc. sales totaled $17.681 billion, up 5.7 percent from total sales of $16.734 billion in the first 39 weeks of 2010. On a same-store basis, Macy's, Inc.'s year-to-date sales were up 5.3 percent.

Online sales (Macys & Bloomingdales combined) were up 39.8 percent in the third quarter and 39.4 percent year to date, compared with the same periods in 2010. Online sales positively affected the company's same-store sales by 1.5 percentage points in the third quarter and 1.4 percentage points in the year to date. Online sales are included in the same-store sales calculation for Macy's, Inc.

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