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The ‘Barron’s Roundtable’ panel provides information on investing in Macy’s, Nordstrom and Gilead Sciences.
Macy’s, which has launched a review process for the struggling business, announced Wednesday that it is accelerating its operations. store closures for a year.
CEO Tony Spring told analysts on an earnings call that Macy’s now expects to close about 65 locations this year, up from a forecast of 50 announced at the start of the year.
However, Spring added that “the closure will take place after the holidays.”
The company is still on track with its plans to close 150 locations over three years as part of its “Bold New Chapter” strategy, which was announced in February.
MACY’S SAYS EMPLOYER ‘INTENTIONALLY’ HIDDEN UP TO $154M IN CASH
The goal, according to Spring, is to ships that “can provide sustainable, profitable growth for the business.”
CFO Adrian Mitchell also said that the company is only closing retail stores.
Women shop at Macy’s Herald Square during Black Friday sales in New York City, US, Nov. 25, 2022. (Reuters/Brendan McDermid/Reuters Images)
“These are the places where the economy is not good. These are the places where customers have left those places to shop. And these are the stores that are very difficult to operate,” Mitchell said.
He continued to say, “very few of the stores are actually in one-store markets. And the reason it’s important is that in the omni business, we continue to see that when we have a physical presence and a digital presence to reach far. to have a very good economy.”
MACY’S CLOSES TWO STORES WITH A TOTAL OF 2,300 EMPLOYEES.
The company previously announced that it would remain closed until all 350 stores were closed. It said it will simultaneously add about 45 Bloomingdale’s and Bluemercury locations. Both brands have continued to show growth in sales.
One of the things the company did was to renovate 50 large stores, also known as the “First 50”, which is intended to serve as a model for the next generation of Macy’s stores. Mitchell said the company was already inspired by the performance of the “First 50” stores. Sales at those stores rose 1.9% in the third quarter.
On Wednesday, Spring said the company plans to open nine more stores and remodel two more stores in the fourth quarter.
People walk past the large Macy’s sign on the building in front of Macy’s Herald Square store on October 8, 2021 in New York City. (Gary Hershorn/Getty Images/Getty Images)
Investor Barington Capital Group said earlier this week that he sees “first promises in this new plan, because it requires the closure of a small number of low-cost Macy’s locations.”
“We believe that this, along with the cost reductions that the company intends to implement, will result in a healthier store that will begin to generate more revenue and improve profitability,” said Barington Capital Group.
