Macy's Inc. (NYSE: M) reported fourth-quarter earnings today, and while the retailer was successful at luring in shoppers during a fiercely competitive holiday season, brutal winter storms led to several store closures and lost sales.
The company said that overall, Q4 profit rose 11 percent to net income of $811 million, up from last year's $730 million. Total revenue slipped 1.6 percent to $9.2 billion versus $9.35 billion last year.
This year's winter has been particularly harsh, and has not only affected Macy's, but all retailers alike. During the last week of January, snow was on the ground in 49 of 50 states, according to CNN. It's still only February, and the 2013-2014 season has already topped the list in some states as one of the snowiest winters ever. Macy's said that at one point during January, 244 Macy's and Bloomingdale's stores, or about 30 percent of the company's total, were shut down because of the weather.
"Once warm spring weather arrives and our full assortment of fresh spring merchandise is in place, we believe customers will return to a more normalized pattern of shopping," said Macy's CEO Terry Lundgren in the earnings statement. "But based on our experience in January and early February, we are watching business trends closely."
Looking ahead, Macy's reiterated previous plans to cut costs and boost margins. As part of the cost reductions, the chain is combining its Midwest and North operations. It is also trimming staff with the elimination of store associates and merchandise planning, central office and administrative jobs. The company said its workforce will remain at about 175,000 employees as it adds staff elsewhere. Macy's expects the job reductions and reorganization to save the company about $100 million a year.
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