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Macy's closes out a horrendous year with hope for 2021

Last Updated Feb 23, 2021 at 5:03 am PST

Shoppers walk into a Macy's department store Monday, Feb. 22, 2021, at Miami International Mall in Doral, Fla. Macy’s is reporting a 52% drop in fiscal-fourth quarter earnings while sales dropped nearly 19% as shoppers continue to stay away from many physical stores during the pandemic. The department store chain said Tuesday, Feb. 23 it anticipates 2021 as “a recovery and rebuilding year as the company sets a foundation for growth.“ (AP Photo/Wilfredo Lee)

NEW YORK — Macy’s fourth quarter profit plunged 52% and sales slid nearly 19%. In the context of a year spent under the weight of a pandemic, that was seen as a pretty good ending to 2020 for the besieged department store.

Shares rose more than 2% before the opening bell Tuesday with Macy’s predicting sales of as much as $21 billion this year, far exceeding the $17 billion that Wall Street had been projecting.

For the final quarter of the year, Macy’s reported profits of $160 million, or 50 cents a share. It was 80 cents per share if one-time costs are considered, and that was also far better than the per-share forecasts of 11 cents from industry analysts, according to a survey by FactSet.

It’s still well below $340 million, or $1.09 per share, for the same period in 2019, the last before COVID-19 emptied retail stores nationwide. Since then, the New York company furloughed a majority of its employees. It began reopening stores in May, but the recovery has been painfully slow.

Quarterly sales were $6.78 billion, also edging out analyst projections.

Sales at stores opened at least a year fell 17%, but online sales rose 21%. Elevated online sales may be here to stay. Macy’s said Tuesday that it expects digital sales to reach $10 billion within the next three years and that the online side will become even more profitable.

Anne D’Innocenzio, The Associated Press