Macy’s to shutter 15 per cent of US stores as it looks to grow online
US department store chain Macy’s is to shut around 100 stores – some 15 per cent of its total – as it battles falling foot traffic.
The stores slated to be closed represent around four per cent of its declining revenue.
Macy’s shares climbed on the news, ending the session up in New York, though are down more than 40 per cent over the past 12 months.
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Macy's meanwhile reported earnings, excluding charges, of 54 cents per share, on revenue of $5.9bn for the second quarter, down from $6.1bn year-on-year.
Most of the 100 stores the company plans to close – it has not named which will be yet – are to be shuttered in early 2017. Others will close as leases and other obligations expire or are waived.
Macy’s already announced this year it would close 40 stores as online competitors continue to win market share.
Terry Lundgren, Macy’s chairman and chief executive, reassured investors with talk of a comeback. He said:
Over the past few months, we have been saying that a setback is a setup for a comeback, and we now believe we are set up well to proceed to a comeback.
Our sales strengthened month-by-month throughout the second quarter. This trend improvement gives us confidence in our plans for the back half of the year, and in our strategic planning for improvements to our business model going forward.
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Macy's now has 728 stores and has shuttered around 90 stores over the past six years, while opening 13.
In May Macy's cut its sales and earnings growth forecasts, as consumers tightened the purse strings.