“Most of these stores will close early in 2017, with the balance closing as leases and certain operating covenants expire or are amended or waived”, the company said in a prepared statement.
Advertisement
Macy’s President Jeff Gennette, who is to become CEO next year, said the locations to be closed have seen declining profit in recent years.
Macy’s now operates 675 full-line stores nationwide and 728 stores overall.
From overseeing the marriage between department stores Federated and May back in 2005 to buying cosmetics retailer BlueMercury previous year, Macy’s (M) Chairman and CEO Terry Lundgren hasn’t been shy about signing off on bold moves.
The company will inform its store closing decisions directly with the staff of the facilities being shut down and Macy’s associates may be offered positions in nearby stores, the release said.
Macy’s said closing the stores would enable the chain to bolster its online presence and “elevate our total customer experience across all methods of shopping”.
Macy’s meanwhile reported earnings, excluding charges, of 54 cents per share, on revenue of $5.9bn for the second quarter, down from $6.1bn year-on-year.
“They considered it one of their four legacy stores along with San Francisco, Chicago and NY”, he said.
Kohl’s said it planned to close 18 of its most underperforming stores in 2016.
Slimming down the 748-store count by 14 percent is a key part of Macy’s turnaround strategy, which also includes leveraging its significant real-estate assets.
Macy’s did not identify any of the 100 stores on its preliminary list of closures, but it did provide some insight on the process that identified candidates. The results, however, beat Wall Street estimates as efforts to bring back customers are taking hold.
Management attributed the improvement to hot weather trends, which drove shoppers into stores, as well as more tourists shopping in its major flagship stores.
Macy’s operates a store at Destiny USA and in Great Northern Mall.
The retail chain struggled with sales and profit declines in the last several quarters.
Analysts’ on average had expected earnings of 45 cents per share and revenue of $5.75 billion, according to Thomson Reuters I/B/E/S.
The company said it was sticking to its outlook.
Advertisement
WCPO Insiders will learn why those Macy’s stores are the most vulnerable to closure.
