Macy's, Inc. Reports Second Quarter Earnings of 17 Cents Per Diluted Share vs. 16 Cents Last Year
Diluted EPS, excluding consolidation costs and non-cash asset impairment charges, is 29 cents - flat vs. last year
Diluted EPS, excluding consolidation costs and non-cash asset impairment charges, is 29 cents - flat vs. last year
CINCINNATI, Aug 13, 2008 (BUSINESS WIRE) -- Macy's, Inc. (NYSE:M) today reported earnings of 17 cents per diluted share for the second quarter of 2008, ended Aug. 2, 2008, compared with diluted earnings per share of 16 cents for the same 13-week period last year. Same-store sales in the second quarter declined by 2.1 percent.
Second quarter 2008 earnings include two unusual items (described below) that negatively impacted earnings by 12 cents per diluted share. Excluding these items, the company earned 29 cents per diluted share from continuing operations in the second quarter of 2008.
The first unusual item relates to the consolidation of three Macy's divisions announced in February 2008, which is expected to save approximately $100 million per year beginning in 2009 (approximately $60 million in savings for the partial year in 2008). In the second quarter of 2008, the company booked consolidation costs of $26 million ($17 million after tax or 4 cents per diluted share). Second quarter 2008 results also include non-cash asset impairment charges of $50 million ($31 million after tax or 8 cents per diluted share) related to private brand tradenames acquired in the merger with The May Department Stores Company in 2005. In the second quarter of 2007, Macy's, Inc. earned 29 cents per diluted share, excluding May Company merger integration costs of $97 million ($60 million after tax or 13 cents per diluted share).
Sales
Sales in the second quarter totaled $5.718 billion, a decrease of 3.0 percent compared with sales of $5.892 billion in the same period last year. On a same-store basis, Macy's, Inc.'s second quarter sales were down 2.1 percent.
For the year to date, Macy's, Inc.'s sales totaled $11.465 billion, down 2.9 percent from total sales of $11.813 billion in the first 26 weeks of 2007. On a same-store basis, Macy's, Inc.'s year-to-date sales were down 2.2 percent.
Sales in the second quarter totaled $5.718 billion, a decrease of 3.0 percent compared with sales of $5.892 billion in the same period last year. On a same-store basis, Macy's, Inc.'s second quarter sales were down 2.1 percent.
For the year to date, Macy's, Inc.'s sales totaled $11.465 billion, down 2.9 percent from total sales of $11.813 billion in the first 26 weeks of 2007. On a same-store basis, Macy's, Inc.'s year-to-date sales were down 2.2 percent.
Looking Ahead
The performance of the economy and level of consumer confidence will have an important bearing on retail sales in the second half of 2008, and thus it is difficult to forecast future results with any level of certainty. Macy's, Inc. currently expects same-store sales in the fall season to be flat to down 1 percent, which would result in fiscal 2008 same-store sales of down 1 percent to down 1.6 percent. The company currently expects earnings per share on a diluted basis of approximately $1.70 to $1.85 for fiscal 2008 as a whole, excluding one-time division consolidation costs and impairment charges. The company expects to book approximately $35 million in division consolidation costs in the final half of 2008.
The performance of the economy and level of consumer confidence will have an important bearing on retail sales in the second half of 2008, and thus it is difficult to forecast future results with any level of certainty. Macy's, Inc. currently expects same-store sales in the fall season to be flat to down 1 percent, which would result in fiscal 2008 same-store sales of down 1 percent to down 1.6 percent. The company currently expects earnings per share on a diluted basis of approximately $1.70 to $1.85 for fiscal 2008 as a whole, excluding one-time division consolidation costs and impairment charges. The company expects to book approximately $35 million in division consolidation costs in the final half of 2008.
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