Department stores operator Macy's Inc. (M), Thursday reported a 3.4% increase in both total sales and same-store sales for the the four weeks ended Jan. 30, 2010. On the better-than-expected sales, the company also raised its earnings outlook for the fourth quarter and fiscal year 2009, which is expected to come in above market estimates.
Total sales for January were $1.255 billion, up 3.4% from $1.213 billion in the year-ago period. Online sales, combining macys.com and bloomingdales.com, improved 23.9% in January.
For the 13-week fourth quarter of fiscal 2009, Macy's, Inc.'s sales totaled $7.851 billion, down 1.0% from total sales of $7.934 billion in the same quarter of the previous year. On a same-store basis, the company's fourth quarter sales were down 0.8%. Online sales increased 26.6% for the fourth quarter, positively affecting same-store sales by 0.7 percentage points.
For fiscal 2009, Macy's sales totaled $23.491 billion, down 5.6% from total sales of $24.892 billion in fiscal year 2008. On a same-store basis, Macy's fiscal year 2009 sales were down 5.3%. Online sales were up 19.6% for fiscal year 2009 which positively affected same-store sales by 0.6 percentage points.
Terry Lundgren, chairman, president and chief executive officer of Macy's, Inc., said, "Our fiscal year ended on a strong note, with performance throughout the fourth quarter driven by the unified organizational structure implemented at Macy's in 2009, as well as continued success in our My Macy's localization strategy."
"Through these two initiatives, as well as a strong sales performance at Bloomingdale's, we have been able to improve our sales trend, manage expenses, increase margins and accelerate cash flow - all of which have contributed to earnings that are higher than we had anticipated," Lundgren added.
Given the better-than-expected sales, expense management and gross margins, as well as a favorable tax settlement, the company now expects fourth quarter earnings to be $1.35 to $1.37 per share, excluding restructuring-related costs, compared with the previous guidance of $1.14 to $1.18 per share.
On average, 15 analysts polled by Thomson Reuters expect the company to report earnings of $1.18 per share for the quarter. Analysts' estimates typically exclude special items.
Included in the new fourth quarter guidance is a non-cash credit resulting from the settlement of the company's federal income tax examinations for fiscal years 2006, 2007, and 2008. For fiscal 2009, the company now expects earnings to be $1.36 to $1.38 per share, excluding restructuring-related costs, compared with previous guidance of $1.15 to $1.19 per share. Analysts expect the company to report earnings of $1.18 per share for fiscal 2009.
Macy's, Inc. is slated to report its fourth quarter earnings on Tuesday, February 23.
M is currently trading at $16.85, up 0.61 or 3.76%, on a volume of 19.79 million shares on the NYSE.
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