CINCINNATI–With net sales up and key expense metrics down, Macy’s reported a 470 percent gain in first-quarter net income, to $131 million.
Declaring that the department-store retailer is building a “culture of growth,” Terry Lundgren, chairman, president and CEO, said the company’s results were a combination of “strong top-line sales, disciplined margin and expense management, improved credit performance and lower interest expense.” Net sales for the quarter, which ended on April 30, rose 5.7 percent to $5.9 billion. The sales pickup included a 5.4 percent increase in same-store sales and a 38.3 percent gain in sales from both macys.com and bloomingdales.com.
Selling, general and administrative expenses were down 1 percent in dollars and 230 basis points as a percentage of sales, to 33.5 percent, and interest expense was shaved by 28 percent. Macy’s gross margin did slip 30 basis points to 39.1 percent.
Lundgren added that Macy’s is still in the “early innings” of it current strategies—encompassing the My Macy’s merchandise-localization initiative, enhanced sales training, exclusive and differentiated merchandise and multichannel integration. “We are also 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,” he said.