Macy’s raises outlook after delivering strong third quarter results
Macy’s said it is “gaining momentum and delivering results”, after boosting its sales and profit guidance for the holiday period following solid results born out of the booming US economy.
The department store chain says like-for-like sales rise by 3.3 per cent in the third quarter, with income more than doubling from $30m (£23.12) to $62m following asset sales.
It increased its predicted earnings per share excluding one-off costs from between $3.95 and $4.15 to between $4.10 to $4.30, and raised net sales guidance from 0.3 per cent to 0.7 per cent.
Jeff Gennette, the retailer’s chairman and chief executive officer, said: “We have the right merchandise, the right marketing and the right customer experiences in place to deliver a strong fourth quarter.”
The results are the second solid performance for a large US retailer ahead of the vital Christmas sales period. Home Depot, the hardware store, also lifted its sales profit outlook earlier this week. Strong performance in the US economy is driving high consumer spending, offsetting pressures from ecommerce that are having a devastating effect on traditional retailers in the UK.
Macy’s said improvements were driven by growth in its digital sales and improved results from its physical stores.
The 160 year-old business has closed more than 100 stores and cut thousands of jobs since 2015, as it undertakes its “North Star” strategy to stem the effects of rapidly-dwindling mall traffic and competition for online rivals.
It has invested heavily into its lower-price brand and a loyalty programme, as well redeveloping some of its stores. It shares are up 40 per cent this year, but still sit at just alf what it was valued in 2015.