Macy's Swings to $44M Loss in 3Q
New York City Macy's Inc. swung to a loss in the third quarter as sales dropped more than 7% amid a sharp slowdown in consumer spending.
The company also said it slashed its budget for 2009 capital expenditures by almost half.
However, the chain reiterated its profit outlook, adding it would be at the lower end of the range if current sales trends continue.
Macy's said it lost $44 million in the quarter, after a profit of $33 million a year earlier.
Sales fell to $5.49 billion from $5.9 billion a year earlier.
"Macy's Inc. remains financially healthy, with strong cash flow, a solid balance sheet and ample borrowing capacity. We are committed to continuing to aggressively manage expenses and inventories consistent with planned sales levels," said Terry J. Lundgren, chairman, president and CEO in a statement.
Lundgren added that even in what he describes as a "poor economic environment," he is confident in the company's strategies for gaining market share, particularly as it increases effort to localize store inventories, is yielding "promising early results." He expects that strategy to have a more profound impact in 2009.