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Macy’s comparable Q4 sales up 1.8 percent

By Prachi Singh

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Business

Macy's, Inc. total sales in the fourth quarter totalled 8.666 billion dollars, an increase of 1.8 percent, while comparable sales on an owned basis were up 1.3 percent and up 1.4 percent on an owned plus licensed basis. Sales in fiscal 2017 totalled 24.837 billion dollars, down 3.7 percent from total sales of 25.778 billion dollars in fiscal 2016. Comparable sales on an owned basis declined 2.2 percent and declined 1.9 percent on an owned plus licensed basis.

"We are committed to returning Macy's to comparable sales growth in 2018 and will build on the momentum we created in the fourth quarter of 2017. Macy's had a solid fourth quarter, including strong performance in January, and the full year exceeded our expectations for annual comparable sales and adjusted earnings per diluted share," said Jeff Gennette, Macy's, Inc. Chairman and CEO in a media statement, adding, "We head into 2018 with an improved base business, healthy inventories, a focused and engaged organization and a clear path to return Macy's to growth."

Macy’s reports growth is Q4 and FY17 earnings

Fourth quarter earnings per diluted share were 4.31 dollars compared to 1.54 dollars per share in the fourth quarter of 2016. Fiscal 2017 earnings per diluted share were 5.04 dollars compared to 1.99 dollars per share in fiscal 2016. The company said, fourth quarter and fiscal 2017 adjusted earnings per diluted share were positively impacted by 7 cents due to the change in the effective annual tax rate due to federal tax reform.

Operating income for the fourth quarter was 1.213 billion dollars or 14 percent of sales, compared to 815 million dollars or 9.6 percent of sales, for the fourth quarter of 2016. Operating income for the quarter totalled 1.397 billion dollars or 16.1 percent of sales, excluding restructuring and other costs of 152 million dollars and non-cash retirement plan settlement charges of 32 million dollars.

For fiscal 2017, Macy's operating income totalled 1.807 billion dollars or 7.3 percent of sales, compared with 1.315 billion dollars or 5.1 percent of sales, for fiscal 2016. Operating income for fiscal 2017 totalled 2.098 billion dollars or 8.4 percent of sales, excluding 186 million dollars of restructuring and other costs and 105 million dollars of non-cash retirement plan settlement charges.

In the fourth quarter, the company opened two new freestanding Bluemercury beauty specialty stores for a total of 137 stores. In fiscal 2017, the company opened 36 Bluemercury stores, two Macy's stores, 30 Backstage off-price stores within existing Macy's stores and one Bloomingdale's licensed location in Kuwait. The company closed 16 Macy's stores, including the closure of the Waterfront store in Homestead, PA, which was announced at the end of the fourth quarter. In February 2018, the company announced that it will close its Redmond Town Center main store in Redmond, WA, in early 2019, bringing the total to 83 of the approximately 100 store closures announced in August 2016.

FY18 comparable sales expected to remain flat or rise 1 percent

For fiscal 2018, the company expects comparable sales on both an owned and an owned plus licensed basis to be flat to up 1 percent. Total sales are expected to be down between 0.5 percent and 2 percent in fiscal 2018. Adjusted earnings per diluted share of 3.55 dollars to 3.75 dollars are expected in fiscal 2018, excluding anticipated settlement charges related to the company's defined benefit plans.

Picture:Facebook/Macy's

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