Macy's Coy on Martha in Reporting Strong Q1 sales
Cecile Corral -- Home Textiles Today, June 12, 2012
CINCINNATI - Home was among the strongest performers at Macy's Inc. during a quarter that beat Wall Street expectations, with the Macy's stores' Hotel and Charter Club brands singled out as the strongest private labels in the department.
As for the future of the Martha Stewart Collection in home - or what will take its place should Macy's drop the line as JCPenney launches Stewart shop-in-shops next year - cfo Karen Hoguet said: "There's nothing I can say there," during the company's call with analysts last week.
She was responding to an analyst's question regarding Macy's thinking "about anything with your vendor structure considering the given uncertainty" of the Martha Stewart brand's partnership with the retailer.
Hoguet also indicated Macy's has gained from JCPenney's non promotional price streamlining, part of its strategic repositioning launched in February.
When asked by another analyst how much comp lift Macy's pulled from JCP during the first quarter, Hoguet replied: "In markets where we are competing against Penney's, we have seen an uptick in business. It's hard to quantify how much. But clearly we are getting a benefit from is what is happening there."
Omnichannel retailing is a big push for the company, and Macy's currently has 80 stores equipped to fulfill orders from other stores to meet online demand. By this year's holiday season, Macy's will have over 290 store fulfillment locations, she said.
"We think the sales potential for omnichannel approach is enormous, and in addition could enable us to improve productivity of inventory as well as store square footage," Hoguet said. "We have barely scratched the surface here and we are very optimistic about the possibilities."
Macy's first-quarter sales totaled $6.143 billion, an increase of 4.3%, compared with $5.889 billion in the same period last year. Same-store were up similarly - by 4.4%. And earnings for the quarter were 43 cents per diluted share, an increase of 43% compared with 30 cents per diluted share a year ago.
Quarterly operating income was up 6.4% to $391 million versus $330 million last year.
Online sales - macys.com and bloomingdales.com combined - were up 33.7% for the 13 weeks, and positively affected the company's same-store sales by 1.5 percentage points in the first quarter.
For the quarter ended April 28, net income rose 38% to $181 million, or 43 cents per share.
Sales for the total company increase 4.3% to $6.1 billion. Comps were up 4.4%.
Hoguet said the sales strength in quarter was "very broad-based in terms of merchandise category."
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