The retailer said its exploring joint ventures or other deal structures with third parties to redevelop Macy’s flagship real estate assets in Manhattan (Herald Square), San Francisco (Union Square), Chicago (State Street) and Minneapolis (downtown Nicollet Mall).
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Nov 11 (Reuters) – US stock indexes were mixed on Wednesday as investors bought Amazon.com and dumped brick-and-mortar retailers after a disappointing full-year forecast from Macy’s.
LensCrafters: Macy’s is expanding its relationship with Luxottica Group and will open in-store LensCrafters shops in as many as 500 Macy’s department stores over the next three years. The retailer reduced its estimate for full-year earnings to $4.20 to $4.30 per share from the earlier forecast of $4.70 to $4.80 per share. Comparable store sales for company-owned and licensed locations fell 3.6% during the third quarter.
Macy’s shares tumbled 9 percent in premarket trading following the report.
Terry Lundgren, Macy’s chief executive, summed up those difficulties Wednesday by saying although consumer spending seemed healthy, people were buying items that department stores don’t sell, such as cars, electronic gadgets and home improvement projects.
Sales at stores open at least a year fell 3.6 per cent in their third straight quarterly decline.
Lundgren, in a statement, said the company is working to accelerate the steps needed to adapt to a changing consumer.
Macy’s said it would also continue to consider unloading certain real estate.
“We are concentrating our resources on strengthening our top doors in our best locations”, Lundgren said on the call”. He added that Macy’s will close 35 to 40 stores by early next year, reiterating what the company announced in September, and that the company expects to close more stores further in the future.
Black Friday is nigh and today serves as a grim reminder to the Street of how just one company’s financials and outlook can have a awful impact on an entire industry.
“The goal is to make Macy’s more productive”, he said. He said, though, the Backstage offerings are attractive, and though they’ll start out small, they could grow over time.
The company said that it wants to maintain “a robust Macy’s retail store presence while also bringing alternative use into those buildings”. On average, analysts forecast that Macy’s will post $4.61 EPS for the current fiscal year.
“While several vendors have referenced lower margins in 4Q (seemingly to brace for markdown support), we were still surprised to see inventory so heavy heading into 4Q on Macy’s”.
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Lundgren said that, going forward, Macy’s will concentrate its resources on strengthening its top stores.
