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Macy’s posts preliminary results, delays full earnings release | Global News Avenue

A shopper carries a Macy’s bag on Market Street in San Francisco, California, United States, Wednesday, November 13, 2024.

David Paul Morris | David Paul Morris Bloomberg | Getty Images

macy’s department store It released preliminary third-quarter results on Monday and said it would delay releasing its full earnings as it completes an investigation into accounting issues.

The company is scheduled to report quarterly earnings before the market opens on Tuesday.

Macy’s said in a statement Monday that its third-quarter sales fell 2.4% to $4.74 billion. Comparable sales across its owned and licensed businesses and online marketplaces fell 1.3%.

Macy’s did not release third-quarter earnings data. The retailer said it expects to release full results and fourth-quarter and full-year guidance by Dec. 11.

Macy's delays third-quarter earnings report due to accounting issues

Macy’s said that while preparing its quarterly results, it discovered “an issue in an accrual account related to delivery charges.” After an independent investigation, the company found that an employee handling “small package delivery expense accounting” made incorrect accounting and concealed approximately $132 million to $154 million in deliveries from the fourth quarter of 2021 to the third fiscal quarter of this year. cost. The company said its delivery expenses for the period were approximately $4.36 billion.

The retailer added that the actions would not affect its cash management and supplier payments and said the employee no longer worked for the company.

“At Macy’s, we promote a culture of ethical conduct. While we work to complete the investigation as quickly as possible and ensure this matter is handled appropriately, our colleagues across the company are focused on serving our customers and executing our strategies for a A successful holiday,” CEO Tony Spring said in a statement.

In a press release, Spring praised progress in efforts to close the struggling namesake stores and return to growth. The company has been beefing up staffing and merchandising efforts at its 50 Macy’s stores and plans to open more stores at Bloomingdale’s and Bluemercury, two of its stronger-performing brands.

Over the past three months, comparable sales at the top 50 Macy’s stores that received the additional investment increased 1.9% year over year, the company said. This marks the third consecutive quarter of growth for these stores.

At Bloomingdale’s, comparable sales of own and licensed products, including third-party markets, increased 3.2%. Bluemercury comparable sales increased 3.3%, marking the beauty brand’s 15th consecutive quarter of comparable sales growth.

The owned plus licensed metric includes owned and licensed sales, which include merchandise owned by retailers and brands that pay for space in their stores, as well as the company’s third-party online marketplaces.

Macy’s announced in February that it would Closing approximately 150 (or nearly one-third) stores of the same name and invest in the remaining approximately 350 locations. The company plans to close these stores in early 2027. The company has been selling some of its mall anchor stores but has not disclosed which ones.

Macy’s said in a news release Monday that proceeds from the asset sales totaled $66 million, higher than it expected.

At Macy’s, which will remain open, comparable sales for its own and licensed stores, including third-party markets, fell 0.9%.

Spring said November comparable sales for all three brands were “ahead of third quarter levels.”

Macy’s credit card revenue fell $22 million, or 15.5%, year over year to $120 million in the quarter. This was partially offset by growth in Macy’s Advertising Business Media Networks. Revenue for the quarter increased $5 million, or 13.9%, year over year to $41 million.

Macy’s shares fell 1.2% in pre-market trading on Monday.

As of Friday’s close, Macy’s shares have fallen about 19% this year. This lagged the S&P 500’s 25% gain over the same period. Macy’s closed at $16.30 on Friday, giving it a market capitalization of $4.52 billion.

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