On Tuesday, Hudson’s Bay Co. said sales excluding newly opened or closed stores at its luxury Saks Fifth Avenue chain fell 1.2% in the most recent quarter, while they rose 2% at the discount Saks OFF 5th unit.
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But the question for Macy’s, and many department stores, is whether they can adapt to changing consumer shopping habits fast enough.
Net sales for the quarter declined 5.3 percent to $8.87 billion from $9.36 billion in the year-ago period, but beat analysts’ consensus estimate of $8.83 billion.
Macy’s, which also operates Bloomingdale’s stores, reported a 31 per cent decline in fourth-quarter profits, dragged down by store closings and other costs. We completed the acquisition of Bluemercury, which added capabilities to our signature beauty business.
“Both a stronger US dollar, which tempered tourist spending and an unseasonably warm holiday season, particularly in the Northeast, hurt its top line results”, Boni stated.
Profit fell from $793 million in the fourth quarter of 2014 to $544 million, or $1.73 a share.
Macy’s opened six Backstage pilot stores last fall and plans to open just one this year as it learns from the tests.
Excluding items, adjusted earnings for the quarter were $2.09 per share, compared to $2.44 per share in the prior-year quarter.
Macy’s along with its Bloomingdale chain were stocked well in winter coats, sweaters and other winter clothing, which helped the business take advantage of the colder weather, said Terry Lundgren the CEO in a prepared statement. Full-year owned stores saw a 3% decline in comparable sales. Revenues slumped to $27.08 billion from $28.11 billion in the year-ago period.
Macy’s said it has begun the process of contacting potentially interested parties with respect to partnership or joint venture transactions involving the company’s flagship and mall-based properties.
In terms of guidance in for the coming fiscal year, the company expects EPS in the range of $3.80 to $3.90 on a total sales decline of about 2%. Macy’s said “there has been a high degree of initial interest”, but didn’t comment further.
Lundgren also referred to the retailer’s “M.O.M. strategies”, short for “My Macy’s localization, Omnichannel, and MAGIC selling”, efforts to revamp its personalization and localized product assortments and omnichannel efforts.
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Lundgren said he was encouraged by the way the business responded going into 2016, and believes that the company is “well positioned to stabilize sales levels this year as we lay the foundation for enhanced shareholder value and sustained, long-term profitable growth”.
