Department store chain Macy's, Inc. (M: Quote) reported Wednesday a higher second-quarter profit, as net sales grew 3 percent, with an increase in comparable store sales and a surge in online sales. Earnings per share and topline beat analysts' expectations.
The company lifted its full-year earnings per share outlook, but was below Wall Street estimates. However, it left its same-store sales view unchanged.
The Cincinnati, Ohio-based retailer's result usually heralds the segments performance every year and gives an insight into the show of its peers such as JC Penney (JCP), Kohl's (KSS) and Saks (SKS).
The company recorded a 3 percent increase in same-store sales for the quarter from last year. Same-store sales is a key retail industry performance metric to gauge activity at store locations that have been open for at least a year. Online sales for macys.com and bloomingdales.com combined, increased 36.1 percent.
Terry Lundgren, chairman, president and chief executive officer of the company said, "We were pleased with our spring season results, and they came on top of exceptionally strong spring season performances in each of the past two years."
Quarterly net income increased to $279 million or $0.67 per share from $241 million or $0.55 per share in the year-ago quarter. On average, 16 analysts polled by Thomson Reuters expected the company to earn $0.65 per share for the quarter. Analysts' estimates typically exclude special items.
Net sales for the quarter grew 3 percent to $6.12 billion and exceeded analysts' estimate of $6.10 billion. Gross margin was 41.9 percent of net sales, compared to 41.8 percent a year earlier.
For the first half, Macy's posted earnings per share of $1.09, an increase of 27 percent from last year. For the year to date, the company's sales were $12.26 billion, up 3.7 percent from the prior year. Same-store sales were up 3.7 percent.
Looking forward, the company lifted its earnings guidance for full-year 2012 to a range of $3.30 to $3.35 per share from the prior guidance range of $3.25 to $3.30. Guidance for same-store sales remains unchanged at an increase of about 3.7 percent. Analysts expect the company to earn $3.36 per share for the year.
"We are entering the fall season with optimism about our ability to grow sales and capture market share, especially in the holiday season when shoppers naturally turn first to Macy's and Bloomingdale's," Lundgren added.
During the quarter, the company opened two new Bloomingdale's Outlet stores.
Macy's closed Tuesday's regular trading at $37 on the NYSE. In the pre-market activity, the shares are up 2.7 percent.
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by RTT Staff Writer
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