Macy’s releases Q3 earnings report but doesn’t address eCommerce operations in press release. This is a bit surprising considering they hired Hal Lawton as President and his background with Home Depot and eBay is all about eCommerce.
The company did make one small mention about online sales “We also saw continued double-digit growth in digital…”. One line is not much of a highlight of an eCommerce strategy.
Considering the stock has declined from mid $40s a year ago to around $17.50s today, one would think they would put more emphasis on promoting the importance of eCommerce sales to investors.
We’ve outlined before that Macy’s needs to get out of the old world retail thinking and into the new world if it wants to survive the onslaught of eCommerce.
Instead, they rolled out a new Star Rewards program with more confusing levels of discounts and features. And the old retail guard is surprised Amazon is eating their lunch?
Today’s shopper no longer plays these games. At best they look at comparison sites to find the lowest price. Online prices need to be best prices without involving coupons or discounts.
Here is the Press Release from Macy’s
Macy’s, Inc. today reported third quarter 2017 earnings per diluted share of 12 cents, or 23 cents per share excluding restructuring and other costs and non-cash retirement plan settlement charges. This compares with 5 cents per share in the third quarter of 2016, or 17 cents excluding non-cash retirement plan settlement charges.
The company also reaffirmed its sales and earnings guidance for full-year 2017.
“Overall, we’re pleased with the results for the third quarter and we remain on track to meet our full-year sales and earnings guidance for 2017. Importantly, we also saw better gross margin performance primarily due to our tightly controlled inventory position.
A highlight of the third quarter was the launch of the new Star Rewards loyalty program – our best customers are responding positively. We also saw continued double-digit growth in digital and are encouraged by the potential of Backstage in Macy’s stores,” said Jeff Gennette, Macy’s, Inc. chief executive officer.
“We are excited about our plans for holiday, which is when Macy’s truly shines as a gifting destination. The loyalty program, special in-store experiences and a strong mobile and online presence will help drive holiday sales.
We are bringing our fashion authority to bear on holiday trends and have a strong product assortment. Our best customer will also find the convenience she expects and the holiday experiences she loves.
Macy’s remains intensely focused on executing all aspects of our North Star Strategy. We expect continued improvement in our trends in the fourth quarter, including a solid lift from loyalty and digital, and intend to head into 2018 with momentum,” continued Gennette.
Sales in the third quarter of 2017 totaled $5.281 billion, a decrease of 6.1 percent, compared with sales of $5.626 billion in the third quarter of 2016.
The year-over-year decline in total sales reflects, in part, the closure of stores previously announced by the company. Comparable sales on an owned basis were down 4.0 percent in the third quarter and down 3.6 percent on an owned plus licensed basis.
Macy’s, Inc.’s operating income for the third quarter of 2017 totaled $121 million, or 2.3 percent of sales, compared to $107 million, or 1.9 percent of sales, for the third quarter of 2016.
Operating income for the third quarter of 2017 totaled $176 million, or 3.3 percent of sales, excluding restructuring and other costs of $33 million and non-cash retirement plan settlement charges of $22 million.
Operating income for the third quarter of 2016 totaled $169 million, or 3.0 percent of sales, excluding non-cash retirement plan settlement charges of $62 million.
Operating income for the third quarter included $65 million in book gains related to the sales of real estate compared to $41 million in the third quarter of 2016.
Net cash provided by operating activities was $389 million in the first three quarters of 2017, compared with $308 million in the first three quarters of 2016. Net cash used by investing activities in the first three quarters of 2017 was $346 million, compared with $491 million in the first three quarters of 2016. Operating cash inflows net of investing were $43 million in the first three quarters of 2017, compared with cash outflows of $183 million in the first three quarters of 2016.
In the third quarter of 2017, the company opened eight new freestanding Bluemercury beauty specialty stores for a total of 135 stores and seven new Macy’s Backstage off-price stores within existing Macy’s stores for a total of 45 locations.
During the quarter, the company announced that it will close the following stores in early 2018: Laguna Hills Mall in Laguna Hills, CA; Stonestown Galleria in San Francisco, CA; and Westside Pavilion in Los Angeles, CA.
Macy’s, Inc. reaffirms its previously provided guidance for full-year 2017. The company expects comparable sales on an owned basis to decline between 2.2 percent and 3.3 percent, with comparable sales on an owned plus licensed basis to decline between 2.0 percent and 3.0 percent.
Total sales are expected to be down between 3.2 percent and 4.3 percent in fiscal 2017. Total sales for fiscal 2017 reflect a 53rd week, whereas comparable sales are on a 52-week basis. As previously announced in August, the company expects a 1 cent increase in adjusted earnings per diluted share due to the restructuring of our merchandising operations.
Macy’s, Inc. now expects adjusted earnings per diluted share of between $3.38 and $3.63 in 2017, excluding the impact of the anticipated settlement charges, restructuring and other costs and net premiums and fees associated with debt repurchases.
Excluding the impact of the anticipated fourth quarter gain on the sale of the Union Square Men’s building in San Francisco and the anticipated settlement charges, restructuring and other costs and net premiums and fees associated with debt repurchases, adjusted earnings per diluted share of $2.91 to $3.16 are expected in 2017.
Your Comments are Welcome
What do you think about Macy’s and where they are going? Drop us a line in the comments section below.
If you liked this article and would like to engage with other small business entrepreneurs selling on marketplaces, join our . You can also find us on , , , and or sign up for our newsletter below.
SIGN UP. BE INSPIRED. GROW YOUR BUSINESS.
We do not sell your information. You can unsubscribe at any time.