Macy's said Thursday that revenue in stores open at least one year rose 4.1 in December, edging past Wall Street estimates.
Macy’s said Thursday that revenue in stores open at least one year rose 4.1 in December, edging past Wall Street estimates.
But the figure grew less than the company expected during the combined two-month November and December period, the key holiday shopping months, and Macy’s lowered its fourth-quarter guidance.
The department store chain also said it will close six underperforming stores.
Analysts had expected the December figure to rise 4 percent, according to Thomson Reuters.
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Total revenue for the five weeks ended Dec. 29 rose nearly 4 percent to $5.1 billion from $4.92 billion last year.
The two months of November and December is a key holiday shopping period for retailers, which can make up to 40 percent of annual revenue during that time. Macy’s said revenue in stores open at least one year rose 2.5 percent during the two months combined.
CEO Terry Lundgren said the rate of growth of revenue in stores open at least one year was less than expected, but that was due partly to uncertain economic news and the lingering effect of Superstorm Sandy.
Revenue in stores open at least one year is a key measure of a retailer’s health, because it excludes revenue at stores that recently opened or closed.
Year-to-date, revenue in stores open at least one year rose 3.3 percent and total revenue also rose 3.3 percent to $25.89 billion from $25.07 billion.
The company now expects revenue in stores open at least one year to rise 3 percent to 3.5 percent in the fourth quarter, down from prior expectations of 4.2 percent.
Macy’s now expects earnings of $1.91 to $1.96 for the fourth quarter, excluding costs related to a tender offer and store closings. Previously it expected earnings of $1.94 to $1.99 per share. Analysts expect $1.98 per share, according to FactSet.
Meanwhile, Macy’s said it will close six underperforming stores as part of a normal review of its business. The stores include a Bloomingdales Fashion Show Home Store in Las Vegas, Nev.; and Macy’s in the Paseo Colorado mall in Pasadena, Calif.; Belmont, Mass.; Honolulu, Hawaii; St. Paul, Minn.; and Houston, Texas. Closing the stores will cost $2 million to $4 million taken in the fourth quarter.
After the closings, Macy’s will operate 798 stores in 45 states. Macy’s said it plans to open nine other Macy’s and Bloomingdale’s around the country to replace the stores it is closing.
Macy’s shares slipped 22 cents to $38.09 in morning trading. Its shares have traded in a 52-week range of $32.29 to $42.17.