Macy's(US:M)2024-09-04 10:51Sales Performance - Net sales for the second quarter of 2024 decreased by $193 million, or 3.8%, compared to the second quarter of 2023, totaling $4,937 million[82]. - Comparable sales for Macy's, Inc. declined 4.0% on an owned basis and 3.3% on an owned-plus-licensed-plus-marketplace basis[80]. - Net sales for the 26 weeks ended August 3, 2024, decreased by $329 million, or 3.3%, compared to the same period in 2023, impacted by ongoing macroeconomic conditions[91]. - For the 13 weeks ended August 3, 2024, net sales were $221 million, with a net loss of $135 million[114]. - Comparable sales on an owned basis decreased by 4.0% for the 13 weeks ended August 3, 2024, compared to the same period in the previous year[120]. - The company reported a decrease in comparable sales on an owned-plus-licensed-plus-marketplace basis of 3.3% for the 13 weeks ended August 3, 2024[120]. Financial Metrics - The gross margin increased to $1,999 million, or 40.5% of net sales, compared to $1,954 million, or 38.1% of net sales in the second quarter of 2023[84]. - Adjusted diluted earnings per share for the second quarter of 2024 were $0.53, compared to $0.26 in the second quarter of 2023[81]. - The company reported diluted earnings per share of $0.75 for the second quarter of 2024, compared to $0.48 in the second quarter of 2023[90]. - EBITDA for the 13 weeks ended August 3, 2024, was $439 million, up from $221 million in the same period last year[127]. - Adjusted EBITDA for the 26 weeks ended August 3, 2024, was $802 million, compared to $815 million for the same period in the previous year[127]. Expenses and Costs - SG&A expenses decreased by $7 million, or 0.4%, in the second quarter of 2024 compared to the second quarter of 2023, totaling $1,973 million[85]. - Selling, general and administrative (SG&A) expenses decreased by 1.2% in 2024 compared to 2023, but increased as a percentage of total revenue due to a decline in total revenue[94]. - Credit card revenues decreased by $40 million in 2024, primarily due to higher net credit losses compared to 2023[92]. Cash Flow and Capital Expenditures - Net cash provided by operating activities was $137 million in the first half of 2024, down from $271 million in the first half of 2023[103]. - Capital expenditures in the first half of 2024 were $432 million, focused on digital and technology investments, compared to $564 million in the same period of 2023[105]. - The company ended the second quarter of 2024 with cash and cash equivalents of $646 million, an increase of $208 million from $438 million at the end of the second quarter of 2023[102]. Strategic Initiatives - The company plans to close approximately 55 underproductive Macy's locations in fiscal 2024, up from the previous estimate of 50[79]. - The First 50 locations achieved a second consecutive quarter of comparable sales growth, with Net Promoter Scores increasing approximately 600 basis points from the second quarter of 2023[78]. - Bluemercury experienced a 14th consecutive quarter of comparable sales growth, with an increase of 2.0% on an owned basis[80]. - The company expects to expand its luxury store footprint by approximately 20% through fiscal 2026, including the opening of about 15 small format locations[80]. Taxation - The effective tax rate for the second quarter of 2024 was 23.1%, down from 26.7% in the second quarter of 2023, reflecting different effective tax rates due to state and local taxes[89]. Balance Sheet - Current assets increased from $955 million to $1,028 million from February 3, 2024, to August 3, 2024[113]. - Current liabilities rose from $1,800 million to $2,190 million during the same period[113]. - Noncurrent liabilities increased from $10,199 million to $10,654 million as of August 3, 2024[113]. - The company reported $154 million in dividend income from non-Guarantor subsidiaries for the 13 weeks ended August 3, 2024[115]. Share Repurchase - The company did not repurchase any shares during the first half of 2024, with $1,375 million remaining available under the share repurchase program[108].