Macy’s beats Q1 profit expectations; bad weather chills sales

New York – Macy’s Inc. beat Wall Street expectations with profits of $224 million in the first quarter of fiscal 2014, up 3.2% from $217 million in the same quarter the prior year.



Earnings rose even as sales fell 1.7% to $6.38 billion, from $6.39 billion. Same-store sales declined 0.8%. Increased operating income and decreased cost of sales helped boost net income, while severe winter weather took a toll on sales.



“Overall, business trends were soft in January through March, with the exception of the Valentine’s Day shopping period,” said Terry J. Lundgren, chairman and CEO of Macy’s. “The trend improved in April when the weather began to turn in northern climate zones. We see this as a good sign moving forward into the second quarter.”



In addition to weather, first quarter comparisons were negatively impacted by a calendar shift for the company’s popular Friends & Family event.



Looking ahead, Macy’s continues to expect comparable sales growth in fiscal 2014 in the range of 2.5% to 3%. The company also reiterated its guidance for earnings per diluted share in fiscal 2014 of $4.40 to $4.50.