Commenting on the results, Terry Lundgren, chairman and CEO of Macy's said, “We are seeing continued weakness in consumer spending levels for apparel and related categories.”
“Headwinds are also coming from a second consecutive year of double-digit spending reductions by international visitors in major tourist markets, where Macy's and Bloomingdale's are key destinations, as well as slowdown in some centre core categories – further intensifying the challenges associated with growing topline sales revenue,” he said.
“In particular, our sales trend relative to expectations meaningfully slowed beginning in mid-March, and first quarter results are below our original outlook,” he added.
Net income reported by the company for the quarter was $115 million as compared to $193 million in the previous fiscal, a fall of 40.41 per cent.
Diluted earnings per share were $313.5 in the quarter as compared to $340.7 in the previous quarter.
Noting that the uncertain direction of consumer spending makes predictions of future performance difficult, Macy's now expects full-year 2016 comparable sales on an owned plus licensed basis to decrease in the range of 3 per cent to 4 per cent. This compares with previous guidance for comparable sales on an owned plus licensed basis to decline by approximately 1 per cent in fiscal 2016.
“We are not counting on the consumer to spend more, so we are working harder to give customers more reasons to buy from us by delivering outstanding style, quality and value,” Lundgren said. (MCJ)
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