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Home / Business / Macy announces first quarter 2019 results

Macy announces first quarter 2019 results



Macy's first-quarter earnings and sales in the same business outperformed analysts' expectations as its initiatives to refresh obsolete businesses and attract more people to shopping with its mobile app are signs of a move Payout fell from a year ago, as the department store chain continues to face many of the same challenges that affect all retailers today. It's not easy to lure people into the mall to buy clothes if they could only shop online at Amazon or on platforms like Stitch Fix and Rent the Runway. The stock recently gained around 3%.

Macy & # 39; s also reiterated its previously published earnings outlook for the full year.

This is what Macy's reported on the basis of refinancing data compared to analysts' expectations:

* Earnings per share: 44 cents vs. expected 33 cents
* Revenue: 5.504 bn USD vs. Expected $ 5.055 billion
* Revenues in the same business up 0.7% versus an expected 0.2% decrease on property plus licenses [1

9659002] CEO Jeff Gennette said that the Commerce revenues grew double-digit during the quarter, while Mobile Macy's fastest-growing channel for revenue growth remained.

There were some business implications as the Easter holidays fell later In the season this year, he added, colder, wetter weather has covered much of the country at the beginning of spring and encouraged more consumers to indoors stay.

But Macy's is particularly good at its most loyal buyers. the CEO said. Transaction growth of 5.7% during the quarter was driven by Macy's most loyal customers "shopping more frequently than ever".

Macy's reported net income for the quarter ended May 4 was $ 136 million, or 44 cents per share, at $ 139 million, or 45 cents per share, a year ago. According to Refinitive, this was above the analysts' expectations of 33 cents.

Revenues decreased from $ 5.551 billion to $ 5.504 billion. This roughly matched analyst expectations for sales of $ 5.055 billion.

Sales in Macy's stores, which have been open for at least 12 months, increased 0.7% on own and licensed products, better than expected decline of 0.2%.

For the financial year 2019, Macy & # 39; s continues to demand that net sales are at about the same level as last year. It is forecasted that sales in the same property-based business will remain at 1%. Macy's continues to believe that adjusted earnings per share will be between $ 3.05 and $ 3.25. Analysts had demanded a profit of $ 3.09 per share for the year.

In February, Macy's announced plans to reduce approximately 100 management jobs and achieve annual cost savings of $ 100 million to prevent a decline in sales.

is trying to clean up its apparel offering as inventories have been bloated in the past and items have been left unsold on the shelves, putting profits under pressure. In a broader sense, it is still trying to find trend-setting fashion to compete with such greats as Zara, Lululemon and Madewell.

"We believe that the greatest security gap in the department store sector continues to be in women's apparel – and in particular the need to attract and retain new millennial and generation Z customers," said Cowen & Co. Retail Analysts a study.

Some of Macy's Recent initiatives that will attract buyers include adding rotating marketplaces to popular brands in more than two dozen stores, selling furniture using virtual reality headsets, and launching a mobile checkout option in the US to cut costs and increase sales. Macy's has also announced plans to downsize some of its larger sites, as not so much real estate is needed.

The company continues to expand its off-price business, Macy's Backstage, which can compete with TJ Maxx, Nordstrom Rack, and Burlington, which sells clothing at discounted prices. Macy's opened 120 backstage locations in existing Macy's stores last year and plans to open another 45 this year.

Macy's market capitalization of approximately $ 6.7 billion this year saw a decline in its shares of nearly 27%. Compared to the S & P 500 Retail ETFs (XRTs) gains of about 5%.

In the meantime, tariffs are another threat to retailers like Macy's as the White House has just released a new list for about $ 300 billion earlier this week Chinese goods, which President Donald Trump said he considers slamming with duties of up to 25%. The list includes everything from clothing and sneakers to sporting goods and other accessories that are often found in the mall.

Gennette said Wednesday that Macy's has been working closely with its Chinese partners, shifting some production and continuing to be "hopeful" that 25% of the clothing and footwear tariff would not come into effect. If this happens, "if you expect it will be difficult to find a way that does not affect customers," he said.

– Courtney Reagan of CNBC contributed to this coverage.


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