CIT: West Coast team featured in Fashion Manuscript.
FSG LAWYERS: Represented Loomworks Apparel (P.J. Salvage) on its acquisiton by Delta Galil.
Details on Industry Insight.
Macy’s, Inc. Reports First Quarter Earnings of 30 Cents Per Diluted Share
Company doubles quarterly dividend, raises FY2011 sales and earnings guidance
CINCINNATI--(BUSINESS WIRE)-- Macy’s, Inc. (NYSE:M - News) today reported strong sales, earnings and cash flow for the first quarter of 2011. Earnings for the quarter were 30 cents per diluted share, compared with 5 cents per diluted share last year.
The company also announced today that its board of directors has doubled the quarterly dividend on Macy’s common stock to 10 cents per share. The dividend of 10 cents per share is payable July 1, 2011, to shareholders of record at the close of business on June 15, 2011. The company’s previous dividend had been 5 cents per quarter.
“We are building a culture of growth at Macy’s, Inc. Our performance cannot be attributed to a single factor, but rather to the coordinated execution of a series of complementary customer-centric strategies. In the first quarter, we benefitted from strong topline sales, disciplined margin and expense management, improved credit performance and lower interest expense,” said Terry J. Lundgren, Macy’s, Inc. chairman, president and chief executive officer.
“Based on the strength, momentum and confidence in our business, we are doubling the dividend as a step in returning value directly to our shareholders,” Lundgren said. “Our confidence derives from our belief that we remain in the early innings of implementation of our current strategies – My Macy’s localization, enhanced sales training, exclusive and differentiated merchandise, and omnichannel integration that positions Macy’s and Bloomingdale’s to serve customer needs seamlessly in stores, online and via mobile technology. We also are developing and testing a wide range of new ideas and innovations that will allow us to evolve with our customers and continue to improve our performance.”
Earnings of 30 cents per diluted share for the 13-week first quarter of 2011, ended April 30, compared to 5 cents per diluted share of the 13-week first quarter of 2010, ended May 1. The year-ago first quarter results included $27 million ($17 million after tax; 4 cents per diluted share) in premium and fees related to debt repurchase activity. Excluding these charges, the company earned 9 cents per diluted share in the first quarter of 2010.
Sales in the first quarter of 2011 totaled $5.889 billion, an increase of 5.7 percent, compared with sales of $5.574 billion in the same period last year. On a same-store basis, Macy’s, Inc.’s first quarter sales were up 5.4 percent.
Online sales (macys.com and bloomingdales.com combined) were up 38.3 percent in the first quarter. Online sales positively affected the company’s same-store sales by 1.3 percentage points in the first quarter. Online sales are included in the same-store sales calculation for Macy's, Inc.
In the first quarter of 2011, a Macy’s store in Warwick, RI, was reopened following repairs from flood damage in 2010.
Macy’s, Inc.’s operating income totaled $330 million or 5.6 percent of sales for the first quarter of 2011, compared with $203 million or 3.6 percent of sales for the same period in 2010.
Net cash provided by operating activities was $67 million in the first quarter of 2011, compared with $149 million of cash used by operating activities in the first quarter last year. This includes a funding contribution to the company’s pension plan of $225 million in the first quarter of 2011, compared with $325 million in the first quarter of 2010. Net cash used by investing activities in the first quarter of 2011 was $64 million, compared with $44 million a year ago. Net cash used by financing activities in the first quarter of 2011 was $315 million, including $335 million used to repay debt. In the first quarter of 2010, net cash used by financing activities was $512 million, including $505 million used to repay debt. An additional $109 million in debt is scheduled to mature on Sept. 15, 2011.
Based on strong first quarter results and an improved outlook, Macy’s, Inc. increased its full-year 2011 guidance. The company now expects same-store sales to grow in the range of approximately 4 percent for the remainder of fiscal 2011. Combined with actual sales in the first quarter, this would calculate to same-store sales growth of approximately 4.3 percent in fiscal 2011, compared with previous guidance for approximately 3 percent sales growth in fiscal 2011. Earnings per diluted share are expected to be in the range of $2.40 to $2.45, compared with previous guidance of $2.25 to $2.30 per diluted share in fiscal 2011.
Macy’s, Inc., with corporate offices in Cincinnati and New York, is one of the nation’s premier retailers, with fiscal 2010 sales of $25 billion. The company operates about 850 department stores in 45 states, the District of Columbia, Guam and Puerto Rico under the names of Macy’s and Bloomingdale’s, as well as the macys.com and bloomingdales.com websites. The company also operates four Bloomingdale’s Outlet stores.