“I am grateful to all our teams for their continued commitment to our customers during the holiday season. Throughout the fourth quarter, we delivered an improved omnichannel experience, with effective merchandising and a clear demonstration of value that resulted in a strong close to the year,” said Tony Spring, chief executive officer of Macy’s, Inc. “Our portfolio of iconic and globally recognized nameplates, healthy balance sheet and fortified operations position us to execute A Bold New Chapter. This strategy is designed to create a more modern Macy’s, Inc. that is expected to generate meaningful value for our shareholders in the years ahead.”
Fourth Quarter 2023 Highlights
Comparisons are to the fourth quarter 2022 unless noted otherwise. Financial highlights are reported on a 14-week basis for the fourth quarter of 2023 and on a 13-week basis for the fourth quarter of 2022 unless otherwise noted. Please refer to note 1 within the financial tables regarding reclassifications of certain prior year metrics.
*Diluted loss per share of $0.26 and Adjusted diluted earnings per share of $2.45. This compares to diluted earnings per share of $1.83 and Adjusted diluted earnings per share of $1.88 in the fourth quarter of 2022. Diluted loss per share in the fourth quarter of 2023 included $1.0 billion of impairment, restructuring and other costs primarily related to actions that support profitable growth and market share gains, and align with A Bold New Chapter. Included within this is a roughly $950 million non-cash asset impairment charge, primarily related to the approximately 150 locations planned for closure over the next three years and the remaining associated with corporate assets.
*Net sales of $8.1 billion, down 1.7% versus the fourth quarter of 2022. Digital sales decreased 4% versus the fourth quarter of 2022. Brick-and-mortar sales were roughly flat versus the fourth quarter of 2022.
*Comparable sales, on a 13-week basis, were down 5.4% on an owned basis and down 4.2% on an owned-plus-licensed basis.
*Highlights of the company’s nameplates include: Macy’s comparable sales, on a 13-week basis, were down 6.0% on an owned basis and down 4.7%, on an owned-plus-licensed basis. The Macy’s nameplate saw strength in beauty, particularly fragrances and prestige cosmetics, and its Backstage off-price business while women’s shoes saw continued softness along with relatively weaker performance in cold-weather apparel and accessories.
*Bloomingdale’s comparable sales, on a 13-week basis, were down 1.5% on an owned basis and down 1.6% on an owned-plus-licensed basis. The Bloomingdale’s nameplate saw strength in beauty, women’s contemporary sportswear and the Bloomingdale’s the Outlets business, while men’s and designer handbags continued to be soft.
*Bluemercury comparable sales, on a 13-week basis, were up 2.3% on an owned basis. The Bluemercury nameplate continued to see strength in skincare and color cosmetic categories.
*Other revenue of $255 million, down $64 million. Represented 3.1% of net sales, 80 basis points lower than the fourth quarter of 2022. Net credit card revenue declined 26% from 2022 to $195 million. As expected, the decline was driven by the impact of higher net credit losses in the portfolio.
*Gross margin for the quarter was 37.5%, up from 34.1% in the fourth quarter of 2022. Merchandise margin improved 260 basis points year over year, primarily due to lower clearance markdowns. Delivery expenses as a percentage of net sales improved 80 basis points from the prior year, reflecting better inventory allocation and ongoing efforts to improve the supply chain.
*Selling, general and administrative (“SG&A”) expense of $2.4 billion, a $51 million decrease from the fourth quarter of 2022. SG&A expense as a percent of total revenue was 28.7%, 10 basis points higher compared to the fourth quarter of 2022 due to lower total revenue. SG&A expense dollars benefited from the company’s commitment to ongoing expense discipline, partially offset by investments in the business.
The company also announces, A Bold New Chapter, a strategy designed to challenge the status quo to fundamentally reposition the company, enhance the customer experience, deliver growth and unlock shareholder value. Developed by the Macy’s, Inc. leadership team, with the full support of the board of directors, the strategy aligns the organization to reinvigorate relationships with customers through improved shopping experiences with relevant assortments and compelling value. Details of the strategy can be viewed at www.macysinc.com/investors.
“Over the past several years, we have taken proactive actions to fortify our operations, including strengthening our balance sheet, managing expenses and tightening inventory controls,” said Adrian Mitchell, chief operating and chief financial officer, Macy’s, Inc. “The dedicated work of our teams delivered a solid close to 2023 and provides a strong foundation for us to execute A Bold New Chapter.”
details at: https://www.macysinc.com/newsroom/news/news-details/2024/Macys-Inc.-Reports-Fourth-Quarter-and-Full-Year-2023-Results/default.aspx