Macy's, Inc. (M) Presents at J.P. Morgan 9th Annual Retail Round-Up Conference (Transcript)

Key Points Company Participants - Macy's, Inc. (NYSE:M): The focus of the call is on Macy's, a leading retailer in the United States. - Jeff Gennette: CEO of Macy's, discussing the company's leadership transition and strategic direction. - Adrian Mitchell: CFO and newly appointed COO of Macy's, discussing financial stability, operational efficiencies, and strategic initiatives. Leadership Transition - Tony Spring: Promoted to President and CEO-elect, taking over in February 2024. He has a strong background in retail and will focus on customer experience and brand building. - Adrian Mitchell: Elevated to COO, responsible for stores, supply chain, and technology. He has a strong track record in inventory management and omnichannel retailing. Financial Stability and Operational Efficiency - Low Single-Digit Growth: Macy's aims for low single-digit growth in the coming years. - Double-Digit EBITDA: The company expects a double-digit EBITDA profile in 2024 and beyond. - Inventory Management: Adrian Mitchell has been instrumental in reducing inventory levels and improving inventory control. Strategic Initiatives - Customer Experience: Macy's focuses on providing a seamless omnichannel experience and personalized offers. - Private Brands: The company is reimagining its private brand strategy, focusing on original design, fit, comfort, versatility, and value. - Marketplace: Macy's is expanding its marketplace model, offering customers more choice and driving growth. - Luxury: Macy's is investing in luxury categories, leveraging the strengths of Bloomingdale's and Bluemercury. - Off-Mall Expansion: Macy's is exploring off-mall locations, such as Market by Macy's and Bloomie's, to reach new customers. Market Dynamics - Consumer Pressure: The company expects continued pressure on the consumer due to inflation and economic uncertainty. - Inventory Levels: Macy's has reduced inventory levels and improved inventory control, positioning the company for flexibility and responsiveness. - Category Trends: Macy's is seeing a return to fashion categories and a strong performance in occasion-based wear and gifting. Future Outlook - Profitable Growth: Macy's aims for profitable growth in the future, driven by its strategic initiatives and disciplined execution. - Cash Allocation: The company focuses on preserving cash, investing in the business, and returning value to shareholders. Additional Important Points - Customer Base: Macy's is focused on engaging a broader base of customers across demographics and geographies. - Technology: Macy's is investing in technology to improve the customer experience and drive growth. - Real Estate Strategy: Macy's is exploring off-mall locations and reevaluating its mall-based stores. - Capital Allocation: The company is disciplined in its capital allocation, focusing on winning the customer, investing in the business, and returning value to shareholders.