Macy's (M) reported a significant earnings increase over the second quarter of last year was driven by higher-than-expected sales, improved margins, a reduced expense rate and disciplined inventory management.
"We believe our business is beginning to hit its stride after implementing significant structural and organizational changes over the past two years," said chairman, president and CEO Terry Lundgren. "While the economic environment remains uncertain, Macy's and Bloomingdale's have a terrific opportunity to continue to take market share and grow our business profitably."
Macy's said it earned 35 cents per share in the quarter, up from 20 cents per share in the second quarter last year, and way ahead of estimates of 29 cents per share. The retailer reported operating income totaled $370 million, compared with operating income of $282 million for the same period last year.
Sales in the second quarter totaled $5.54 billion, up 7.2% from total sales of $5.16 billion in the second quarter of 2009, and slightly ahead of estimates of $5.5 billion. Macy's reported second quarter same-store-sales were up 4.9%.
Looking ahead, Macy's raised its guidance -- the second time this year. It currently expects same-store sales in the second half of fiscal 2010 to be up in the range of 3% to 3.5%, which would result in full-year 2010 same-store sales to be up between 4% and 4.2%.
The company is also increasing its full-year 2010 earnings guidance to $1.85 to $1.90 per diluted share from a previous $1.75 to $1.80 per diluted share
"The improvement in our business is not the result of a single factor. Rather, our performance reflects a number of strategic initiatives that are working successfully and complementing each other," Lundgren said. "We are entering the fall season with tremendous momentum that has energized the exceptionally talented people in our company."
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