NEW YORK — Macy’s chairman, president and CEO is walking on air these days as the nation’s leading department store chain continues to deliver impressive results amid a recessionary economy that has other operators floundering for sales.
The company said second-quarter sales at its 850 stores increased 7.3% to $5.9 billion, and same-store sales increased 6.4%. The company was able to leverage the top line growth to produce net income that grew 64% to $241 million and earnings per share that grew 57% to 55 cents a share, well ahead of the 48 cents a share analysts had expected.
“This was our most successful second quarter and spring season in more than a decade,” Lundgren said. “Importantly, it came on top of an impressive first half performance last year. To date this year, we have driven significant additional sales growth, gained market share, maintained strong margins, managed expenses and generated a very healthy level of cash.”
The improved results stem from a reorganization of the company during 2008 and 2009, which Lundgren said instilled a culture of growth at the company that was again evident in the second quarter. Buoyed by success during the first half of the year, Macy’s increased its full year sales and earnings outlook.
The company now expects same-store sales in the second half of fiscal 2011 to be up between 4% and 4.5%, which would give the company a full-year increase in the range of 4.8% to 5.1%. That is markedly higher than the full-year forecast of 3% provided at the beginning of the year. In addition, full-year earnings per share are now expected to total between $2.60 and $2.65 per diluted share, well above guidance of $2.25 to $2.30 provided at the beginning of the year.
“All of our key strategies are working, and working in unison, to help us better understand our customers, deliver the assortments and value they want and expect, and engage them in stores, online and via mobile devices with a shopping experience that is convenient and compelling,” Lundgren said. “Our Macy’s and Bloomingdale’s brands are continuing to evolve, testing new ideas and developing the extraordinary level of talent and expertise within our company. All of these factors have helped us to overcome an economic environment that remains sluggish. As we continue to closely monitor developments in the economy and financial markets, we are cautious but optimistic about this fall and are staying focused on those factors we can control.”
One thing Macy’s is doing a good job of controlling is its online business. The company disclosed that online sales increased 40.2% during the second quarter and accounted for 1.2% of the total 6.4% comp increase.