May merger on track; reports 1Q numbers
May 10, 2005-- Home Textiles Today,
ST. LOUIS — May Department Stores Company said during its first quarter conference call today that it is on track to complete its merger with Federated Department Stores in the third quarter.
"Both (May and Federated) are taking steps to gain the necessary approvals by the shareholders of each company as well as approval from the Federal Trade Commission," said Tom Fingleton, executive vice president and chief financial officer. "We continue to believe that the merger will be completed in the third quarter. Of course, there are no assurances on this."
The company also offered an update on its planning and allocation improvement efforts.
"The streamlined version (of the allocation improvement) is not going to require any organizational changes, and we’re also deferring any major, major systems projects," Fingleton said. "But there are a number of the basic principals that we’re going to, starting with the Filene’s and Robinsons-May divisions."
May also unveiled its first quarter numbers today, reporting net earnings of $41 million compared with $76 million last year, a drop of 46 percent. Earnings were impacted by store divestiture costs of $9 million and a $14 million income tax provision reduction. Excluding these, 2004 first quarter earnings were $81 million. Also included in the first quarter numbers was $4 million of expenses related to the pending merger.
Taking out divestiture costs and comparing this year’s $47 million with last year’s $81 million, May saw a drop in earnings of 42 percent.
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