Macy’s returns to profit amid local push

By Associated Press
Posted Nov. 10, 2010 at 7:36 a.m.

Macy’s Inc. said Wednesday it turned a profit in the third quarter after a loss a year ago, boosted by tailoring merchandise to local markets and higher spending from wealthier customers at its Bloomingdale’s chain.

Macy’s has benefited from its localization plan, which puts decisions on what merchandise to stock closer to customers. Its fashion exclusives have also helped bring in new shoppers. The company has said that its moderately priced Material Girl, a teen clothing collection created by pop star Madonna and her 13-year-old daughter Lourdes, has done well.

Meanwhile, affluent shoppers, buoyed by a rallying stock market, have started to go back to spending. That has helped its upscale Bloomingdale’s chain.

Macy’s said it earned $10 million, or 2 cents per share, for the period ended Oct. 30. That compares with a loss of $35 million, or 8 cents per share, a year ago.

Excluding certain items, Macy’s earned 8 cents per share for the latest quarter.

Macy’s said its revenue rose 6.6 percent to $5.6 billion. The department store posted a 3.9 percent gain in revenue at stores opened at least a year, a measure that’s considered key in evaluating the health of a retailer.

Analysts surveyed by Thomson Reuters had expected 5 cents per share on revenue of $5.56 billion.

For the full year, the company said Wednesday that it expects earnings between $1.94 and $1.99 per share. That compares with previous guidance of between $1.89 and $1.94 per share. Analysts had expected $1.96. It had boosted its second-half earnings outlook last week.

Macy’s also boosted its outlook on Wednesday for revenue at stores open at least a year for the second half. It now expects that measure to be up between 3.3 percent and 4 percent. That compares with an earlier outlook for an increase of 3 percent to 3.5 percent offered in August.

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