The Cincinnati-based company said the locations of the closed stores would be announced at a later date.
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Earlier this year, Macy’s leaders said they needed to work on three fronts to improve the company’s standing: speed up initiatives that are working, excite customers with new merchandise and expand cost-cutting efforts.
Macy’s has a store in Camp Hill at the Capital City Mall and a second store at the Harrisburg East Mall. But the results were better than analysts feared.
It has been a tough year for retailers with a range of reasons given for their poor performance, including warm weather, excessive competition, Brexit uncertainty and the ongoing rise in e-commerce, in particular Amazon.
In trading Thursday, Macy’s stock closed at $39.81, up 17.09%.
Jeff Gennette, the Macy’s executive who has been appointed to replace Lundgren in 2017, said in a statement that almost all of the stores it plans to close are ones whose sales volume and profitability have been sliding. At Macy’s, deep discounting has not done enough to convince customers to spend more money.
The chain will be looking into investing more into online shopping. Of course, Macy’s online shop will remain in full force. The announcement of the closure came as a shock to Roseburg shoppers and was called a “tragic” loss for the mall. Management attributed the comp decline to the closures of 41 underperforming Macy’s stores in fiscal 2015.
At its peak in January 2007, the chain had 868 stores, including locations under the Bloomingdale’s brand, the AP reported.
Annual sales for the approximately 100 locations to be shuttered is projected at roughly $1 billion, excluding sales expected to be diverted to nearby stores.
“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.
Bell described Macy’s as a “venerable brand that does well”, but said the company is struggling in some markets. The current round of closures will leave Macy’s with about 575 full-line stores.
The Macy’s Herald Square flagship department store is seen here in New York, Aug. 9, 2016. That’s down from $217 million, or 64 cents a share, in the year-earlier quarter. The retail sector and department stores in particular have seen their fair share of struggles in recent months, despite a recovering US economy and seemingly growing consumer spending levels, so investors were greatly anticipating these earnings reports to see the state of the two companies. “Macy’s first-ever “Black Friday in July” event was a terrific success which drove record store and online sales for a mid-year period”. The group has already closed 38 stores this year. The closely-watched metric of comparable sales fell 2.6 percent.
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The company said it was sticking to its outlook. Macy’s had said in May that it expects revenue at stores, including business from licensed departments, open at least a year to be down 3 percent to 4 percent.
