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U.S. retailer Macy's said Wednesday that sales at its stores open at least one full fiscal year fell 7.1 percent in January, and announced restructuring plans to cut costs.
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Macy's [M
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] said the restructuring would result in the elimination of roughly 2,300 positions.
Total sales for the four weeks ended Feb. 2 at the parent of Macy's and Bloomingdale's fell 28.4 percent to $1.28 billion as a retail calendar change resulted in one less week of sales in the month.
Analysts, on average, expected a drop of 5.7 percent in same-store sales, according to Reuters Estimates.
The company said it would consolidate its U.S. operations to end up with fewer divisions. For instance, its Macy's North headquarters in Minneapolis would be integrated with its New York-based Macy's East operations.
The overall consolidation will affect more than 2,500 jobs in various divisions, Macy's said. The retailer has 188,000 employees.
The restructuring is expected to result in a charge of $150 million in 2008, Macy's said. The plan would also reduce its selling, general and administrative expenses by about $100 million in 2009.
Macy's said it expects to earn between $1.75 and $1.80 in the fourth quarter, but said that the forecast included a non-cash tax credit but did not factor in integration costs of $70 million.
Including consolidation costs, it forecast earnings for fiscal 2008 between $1.85 a share to $2.15 a share.
The company forecast 2008 same-store sales in the range of down 1 percent to up 1.5 percent.
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