NEW YORK--(BUSINESS WIRE)--Macy’s, Inc. (NYSE: M) today reported results for the third quarter of 2020.
“Macy’s, Inc. third quarter results reflect solid performance across all three brands – Macy’s, Bloomingdale’s and Bluemercury. Our results were driven by disciplined cost management, strong execution by our colleagues and an early start to the holiday shopping season,” said Jeff Gennette, chairman and chief executive officer of Macy’s, Inc. “Customers shopped our brands across all channels in the third quarter and responded well to our expanded fulfillment offerings, such as curbside, store pickup and same-day delivery. Our digital business delivered strong growth and sales in our stores continued to recover. Customers have shifted their spending to casual apparel and categories they can enjoy as they stay at home. Several of these categories, including home furnishings, jewelry and fragrance, have generated double-digit sales growth compared to last year.”
“Looking to Holiday 2020, we know this year is different. We are committed to bringing the joy of the season to America as we do every year. From next week’s Thanksgiving Day Parade to reimagined family gatherings, we will help our customers and their families celebrate in style. We have the right gifting assortment with newness from value to luxury, and our expanded fulfillment options allow customers to shop safely and conveniently, in store or online,” continued Gennette. “We continue to watch the resurgence of COVID-19 and its potential impact on our business. Our teams are executing well and have shown the flexibility and agility to adjust plans and provide a great omnichannel experience to our customers.”
Financial Highlights
| Third Quarter | Year to Date | ||||||||||||
| (All amounts in millions, except per share figures) | 2020 | 2019 | 2020 | 2019 | |||||||||
| Net sales | $ | 3,990 | $ | 5,173 | $ | 10,566 | $ | 16,223 | |||||
| Net income (loss) (a) (b) | $ | (91 | ) | $ | 2 | $ | (4,104 | ) | $ | 224 | |||
| Earnings (loss) before interest, taxes, depreciation and amortization (a) (b) | $ | 113 | $ | 300 | $ | (4,182 | ) | $ | 1,147 | ||||
| Diluted earnings (loss) per share (a) (b) | $ | (0.29 | ) | $ | 0.01 | $ | (13.20 | ) | $ | 0.72 | |||
| Adjusted Net income (loss) (b) | $ | (60 | ) | $ | 21 | $ | (941 | ) | $ | 246 | |||
| Adjusted Earnings (loss) before interest, taxes, depreciation and amortization (b) | $ | 159 | $ | 325 | $ | (672 | ) | $ | 1,175 | ||||
| Adjusted Diluted earnings (loss) per share (b) | $ | (0.19 | ) | $ | 0.07 | $ | (3.03 | ) | $ | 0.79 | |||
| (a): The results for the 39 weeks ended October 31, 2020 include the pre-tax impact of the non-cash goodwill and long-lived asset impairment charges of $3.1 billion and $83 million, respectively, as well as the related tax impact. | ||||||
| (b): The results for the 13 and 39 weeks ended October 31, 2020 include benefits of tax law changes resulting from the Coronavirus Aid, Relief and Economic Security ("CARES") Act. | ||||||
| Note: Adjusted metrics reflect the exclusion of certain items from the respective financial measures. Please see the final pages of this news release for important information regarding the nature of such excluded amounts and calculation of the company’s non-GAAP financial measures. |
Third Quarter Highlights
- Positive EBITDA one quarter sooner than expected.
- Strong liquidity position with approximately $1.6 billion in cash and approximately $3 billion of untapped capacity in the company’s asset-based credit facility.
- Digital sales grew 27% over third quarter 2019. Digital sales penetrated at 38% of total owned comparable sales.
- Comparable sales down 21.0% on an owned basis and down 20.2% on an owned plus licensed basis, due to continued stores recovery and continued growth of digital business.
- Inventory down 29% from third quarter 2019. The company exited the quarter in a clean inventory position.
- Gross margin of 35.6% compared to 23.6% in the second quarter of 2020, an improvement of approximately 12 percentage points. The improvement was driven by disciplined inventory management, better sell through of both full-price and clearance merchandise and lower clearance markdowns.
- Selling, general and administrative (“SG&A”) expense of $1.7 billion, down $476 million from third quarter 2019, illustrating efficient expense management and improved colleague productivity in stores.
- Diluted loss per share of $(0.29) and Adjusted diluted loss per share of $(0.19).
2020 Guidance
Macy’s, Inc. previously withdrew its 2020 earnings guidance due to ongoing uncertainty as a result of the COVID-19 pandemic. The company is providing limited guidance for 2020, which can be found on the company's website at www.macysinc.com
About Macy’s, Inc.
Macy’s, Inc. (NYSE: M) is one of the nation’s premier omni-channel fashion retailers. The company comprises three retail brands, Macy’s, Bloomingdale’s and Bluemercury. Macy’s, Inc. is headquartered in New York, New York. For more information, please visit www.macysinc.com.
