Macy’s profit for the fourth quarter plunged by 52 percent and sales fell by almost 19 percent. That was seen as a pretty good ending to 2020 for the besieged department store in the context of a year spent under the weight of a pandemic.
With Macy’s predicting sales of up to $20.75 billion this year, shares rose more than 3 percent before the opening bell Tuesday, far exceeding the approximately $17 billion that Wall Street had been projecting. According to FactSet, Macy’s also expects adjusted earnings per share in the range of 40 cents to 90 cents for the year, far better than the $2.92 loss that analysts forecast.
“Macy’s, Inc. anticipates 2021 as a recovery and rebuilding year as the company sets a foundation for growth, ” the department store said in its release.
Macy’s reported $160 million in profits for the final fiscal quarter of the year that ended Jan. 30, or 50 cents a share. If one-time costs are taken into account, it was 80 cents per share, and that was also far better than the per-share forecasts of 11 cents from industry analysts, according to a FactSet survey.
For the same period in 2019, the latest before COVID-19 emptied retail stores nationwide, it’s still well below $340 million, or $1.09 per share. The New York company has since furloughed the majority of its employees. It began reopening stores in May, but the recovery has been painfully slow.
There was $6.78 billion in quarterly sales, edging out analyst projections as well. The business said business was driven by the categories of home, beauty, jewelry and watch, growth in online sales and acquisition of new customers.
Sales at shops opened at least a year dropped 17 percent, but sales online rose 21 percent. High sales online may be here to stay. Macy’s said Tuesday that, within the next three years, it expects digital sales to reach $10 billion and that the online side will become even more profitable.