Federated seeing signs of life in textiles

CINCINNATI — Although soft home performed weakly during the second quarter, there are signs that it's beginning to pick up, analysts were told during Federated Department Stores' quarterly conference call this morning.

And despite the fact that the new Macy's Home Store merchandising organization is still in transition, it is beginning to have some impact. "Product is looking good and Hotel (Federated's proprietary Hotel Collection brand) is doing extremely well," said Karen Hoguet, chief financial officer.

The company reported net income of $78 million, or 43 cents per share, for the quarter ended July 31, down 35 percent from $120 million, or 64 cents per share, in the year-ago quarter. The results included a one-time $59 million charge related to a $273 million buyback of the company's long-term debt.

Sales were $7.1 billion, up 5.1 percent over last year's second quarter. Comps rose 5 percent. Floor coverings and furniture were among the poorest performers during the quarter, Hoguet said.

Stores that have been remodeled under Federated's "reinvent program" continue to outperform non-renovated stores, Hoguet said. Following a bump in the first year after remodeling, the reinvent stores settle into a performance that runs about one point better than other stores, she said. About 50 percent of Federated's store base will have been touched by the program by the early fourth quarter.

The company spent $19 million during the first half related to the Macy's Home Store centralization costs, which impacted second quarter earnings by 11 cents per share and first half earnings by 17 cents per share, according to the company's financial release.

Home & Textiles Today Staff | News & Commentary

 Home Textiles Today is the market-leading brand covering the home and textiles markets, offering a comprehensive package of print and online products. Home & Textiles Today provides industry news, product trends and introductions, exclusive industry research, consumer data, store operations solutions, trade show news and much more.

Featured Video

  • Live From New York: Fashion Comes Across the Pond

    Camera Icon More Videos

Subscribe to
Home & Textiles Today eDaily
Receive the news you need to know about the trends in the industry delivered right to your inbox.

CURRENT ISSUE

HTT Cover October 2017

See the October 2017 issue of Home & Textiles Today. In this issue, we look at the Top 25 Online Retailers.  H&TT's exclusive annual ranking of the biggest online sellers of home textiles finds that while pure play etailers continue to fly, bricks & clicks are digging into omnichannel. See details!