A Macy's store is decorated for the holidays in San Francisco, California, US, on Wednesday, November 13, 2024.
David Paul Morris | Bloomberg | Getty Images
Messi It said Wednesday it had ended an investigation into an employee who intentionally hid about $151 million in delivery expenses in his accounting books for nearly three years and audited those years of his historical financial statements.
In a statement, CEO Tony Spring, who took the position in February, said Macy's is “strengthening our existing controls and implementing additional changes designed to prevent this from happening again and to demonstrate our strong commitment to corporate governance.”
“Our focus is to ensure that ethical behavior and integrity are maintained throughout the organization,” he said in the company's press release.
Store operator It postponed its full quarterly earnings in late November After discovering the accounting problem while preparing its financial statements for the fiscal quarter and launching an independent investigation. It said on Wednesday that the investigation had concluded and found that there was no material impact on financial results in prior years or quarters.
On Wednesday, Macy's also raised its full-year forecast slightly, while still expecting sales to decline. Macy's said it expects net sales to be between $22.3 billion and $22.5 billion, compared to the $22.1 billion to $22.4 billion range it previously expected. That would be a year-over-year decline from the $23.09 billion it reported for fiscal 2023.
For full-year comparable sales, a measure that takes the impact of store openings and closings, Macy's expects a decline of about 1% to a roughly flat level compared with the same period last year. This is higher than the previous range, which saw a decline of about 2% to a decline of about 0.5%. This metric includes merchandise that Macy's owns, items from brands that pay for space inside their stores and Macy's external online marketplace.
Macy's lowered its full-year forecast in August, and its latest guidance remains below the upper end of its forecast. Earlier in the year.
Here's what the retailer reported for its fiscal third quarter compared to what Wall Street expected, according to a survey of analysts conducted by LSEG:
- Earnings per share: 4 cents adjusted. They were not comparable with estimates due to the accounting treatment of the delivery accrual investigation.
- Revenue: $4.74 billion versus $4.78 billion expected
In the three-month period ending Nov. 2, Messi's net income fell to $28 million, or 10 cents per share, from $41 million, or 15 cents per share, in the same quarter last year.
Macy's, which is in the middle of a new turnaround effort, previously disclosed some quarterly metrics. The company said its third-quarter sales were $4.74 billion, down 2.4% year over year. It also reported a similar sales decline of 1.3% across its owned and licensed businesses, as well as its online marketplace.
Macy's namesake brand remains the weakest part of the company. Last quarter, comparable sales for this segment declined 2.2% on a owned-and-licensed basis including the third-party market.
However, Macy's said sales trends are stronger in stores where it has ramped up its efforts. The company will close about 150 of its namesake stores by early 2027, meaning it has about 350 Macy's locations across the country. It has already increased staff and invested in 50 of those stores that will remain open. In those locations, dubbed the “Top 50,” comparable sales rose 1.9%.
At Bloomingdale's, comparable sales were up 3.2% on a proprietary and licensing basis, including the third-party market. Bluemercury's comparable sales increased 3.3%, marking the 15th consecutive quarter of comparable sales growth for the beauty brand.
Along with scrutiny of the accounting mishap, Macy's has felt the pressure from activist investors. On Monday, activist Barrington Capital She revealed that she has a stake in the company She said she wants the retailer to take steps, including potentially selling its luxury brands. This is the fourth time in the past decade that the old store has been targeted by activists.
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