Macy’s department store chain reports slowing sales and supplies due in part to the coronavirus.
The chain has about 70 stores for which Asians are a significant market. Sales have dropped, but “it’s nothing to be concerned about yet,” said Jeff Gennette, Macy’s CEO.
He added that inventory coming from China also has slowed and the company is “watching this very, very carefully.” The U.S.-China trade war has helped the company develop strategies to manage supply disruptions, he said.
Last week, Macy’s posted profits of $340 million for the three months ending 1 February, down 55 percent year-on-year.
In February, Macy’s announced it would close 125 stores and lay off 2,000 people to cope with sluggish growth and sagging profits.
In a silver-lining announcement, J.C. Penney Co. projects that in-store sales will fall no more than 4.5 percent in 2020, compared to a 7.7-percent decline in 2019.
The sales dropped 7 percent in 2019’s fourth quarter, better than the 7.3 percent analysts had forecast.
However, it was the sixth consecutive quarter in which sales had dropped off.
The company reported a quarterly profit of $27 million against $75 million for the same period last year. It also booked earnings of 13 cents a share, surprising analysts who had expected a 6-cent loss.
Penney’s shares fell 5 percent on 27 February to 69 cents, capping a 34-percent decline over the last three months.
The New York Stock Exchange has warned Penney that it is out of compliance with listing requirements which mandate its shares not close below $1 for 30 consecutive trading days. As a result, Penney may be delisted.
