Macy's has a near-term plan to stem losses

Macy's (NYSE:M) declining sales accelerated in the first quarter, the continuation of a trend the company hopes to reverse with a near-term plan.

Sales for the first quarter declined 7.4 percent compared to last year and same-store sales dropped 6.1 percent. Profits for the period dropped to $116 million from $193 million last year.

It's the fifth straight quarter of declines for Macy's, and the company's stock shed 9.4 percent in early trading.

Still, Chairman and CEO Terry Lundgren outlined a plan to reverse these trends in the near-term.

First, Macy's said it will speed up and scale up programs that are working, including in-store pilots. Macy's Backstage off-price outlet will see nine more locations by year end and a total of 22 Bluemercury beauty departments are planned through the year.

An upgraded jewelry department already piloted in 40 stores will be in a total of 350 locations, and additional staffing, space and marketing resources will be applied to strong categories such as beauty, active products and Macy's Last Act clearance pricing programs.

There will be greater emphasis on exclusive merchandise such as the Love Bravery collection from Sir Elton John and Lady Gaga.

Expense reductions will be intensified but key areas will continue to be invested in including customer-facing services.

"As we rebuild our business for a comeback that we expect will begin later this year, we continue to focus on agility and innovation – supporting and testing new ideas and approaches so we can identify the best way to serve evolving customer needs, and moving fast to scale up the most successful pilots on a broader basis to fully capture growth opportunities," Lundgren said.

Macy's revised full-year expectations down.

For more:
- see this Macy's press release
- see this Wall Street Journal article

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