Last minute festive shopping spree boosts Macy's

A strong run up to Christmas helped Macy’s beat fourth-quarter forecasts, the American US department store chain confirmed on Tuesday.

Net sales in the last three months of the year came in at $8.34bn, down on the $8.46bn recorded a year previously but more than the $8.32bn pencilled in by Wall Street. Adjusted earnings per share were $2.12, compared to $2.73 a year earlier; analysts were expecting around $1.96.

Jeff Gennette, chairman and chief executive, said: “Taken as a whole, 2019 did not play out as we intended. However, we executed well during the holiday 2019 season. We were pleased with the significant trend improvement in the fourth quarter, including a meaningful sales uptick in the ten shopping days before Christmas.

“Together with disciplined expense management, our solid sales results in the fourth quarter allowed us to deliver stronger-than-expected earnings results. Importantly, we exited the year with a clean inventory position.”

Full-year net sales eased to $24.56bn from $24.97bn, while adjusted EPS was $2.91, compared to $4.81 a year earlier.

Looking to the current year – which Gennette has called a “transition” period for the retailer – Macy’s forecast full-year net sales of between $23.6bn and $23.9bn. Adjusted EPS is expected to be in the range of $2.45 to $2.65.

Macy’s is battling both falling footfall, as more shoppers go online, and cut-price rivals. It recently announced a restructuring programme, under which it will close 125 stores over three years and trim its corporate workforce by around 9% as it seeks to make around $1.5bn in annual savings.

Shares jumped in early trading in New York. By 1430 GMT, the stock was nearly 2% higher at $15.75