Earn­ings up for Macy’s as cost cuts con­tinue

Third-quar­ter re­port stressed chal­lenge of hol­i­day sea­son as chain deals with on­line re­tail


NEW YORK— Macy’s Inc. re­ported that its third-quar­ter earn­ings more than dou­bled as it con­tin­ues to cut costs. But the de­part­ment store chain re­ported weaker-than-ex­pected sales as it con­tin­ues to have a hard time pulling shop­pers through its doors.

The re­port, re­leased Thurs­day, un­der­scores just how chal­leng­ing the hol­i­day shop­ping sea­son will be.

Like all de­part­ment stores, Macy’s has wres­tled with weak sales as cus­tomers go on­line and also in­creas­ingly spend on things other than cloth­ing.

It’s fac­ing stiff com­pe­ti­tion in the cloth­ing world as on­line leader Ama­zon ex­pands fur­ther into fash­ion.

To turn its busi­ness around, Macy’s has cut jobs and closed some lo­ca­tions.

It’s been ex­pand­ing into off-price stores and launched a loy­alty pro- gram last month that it hopes will bring more shop­pers to its stores. Still, it hasn’t been able to re­verse a slide in sales.

The com­pany re­ported that rev­enue at stores opened at least a year was down 4 per cent for the third quar­ter, worse than the 2.9-per-cent drop that an­a­lysts ex­pected. The de­cline marked the 11th straight drop for the key mea­sure.

Macy’s is in­creas­ing the num­ber of tem­po­rary work­ers it’s hir­ing for dis­tri­bu­tion and ware­houses for the hol­i­day sea­son as it chases fast­grow­ing e-com­merce sales. But its over­all hol­i­day hir­ing will fall nearly 4 per cent.

Macy’s said that its fis­cal thirdquar­ter net in­come was $36 mil­lion (U.S.), or12 cents per share. Earn­ings, ad­justed for one-time gains and costs, were 23 cents per share.

The re­sults topped Wall Street ex­pec­ta­tions, but the bar was set low. The av­er­age es­ti­mate of eight an­a­lysts sur­veyed by Zacks In­vest­ment Re­search was for earn­ings of 19 cents per share.

Macy’s has cut jobs and closed some lo­ca­tions as it wres­tles with weak sales due to stiff com­pe­ti­tion.

Newspapers in English

Newspapers from Canada

© PressReader. All rights reserved.