Federated Department Stores, Inc. posted an 8.9% decrease in total sales for the month of November to $2.385 billion from $2.617 billion in the same period last year. Total sales declined from November 2005 to November 2006, impacted by the closing of 78 duplicative store locations over the past year. On a same-store basis, Federated's sales for November were up 8.5%. This exceeded the company's guidance for a same-store sales increase of 3% to 5% in November.
For the year to date, Federated's sales totaled $20.196 billion, up 30.8% from total sales of $15.436 billion in the first 43 weeks of 2005. On a same-store basis, Federated's year-to-date sales were up 4.1%.
“November was another great month for legacy Macy's and Bloomingdale's stores, which exceeded our expectations across the country,” said Terry J. Lundgren, Federated's chairman, president and chief executive officer. “While we continue to be disappointed in the performance of former May Company locations, particularly in home merchandise categories, we remain confident that our ongoing strategy for success is sound. In part, the sales lag in former May doors can be attributed to intense promotional activity last year, which we chose not to repeat, thus creating unfavorable year-over-year comparisons. Our guidance for total sales in the fourth quarter remains on track, with the mix of sales from legacy Federated and former May stores in December expected to follow the same path set in the third quarter and November.”
Federated increased its same-store sales guidance for December. Same-store sales now are expected to be up by 5% to 8%, compared with previous guidance for an increase of 3% to 5%. Same-store sales for the fourth quarter as a whole are expected to increase by 5% to 7%. The company continues to expect total fourth quarter sales of $9.1 billion to $9.4 billion.
Federated's same-store sales include only legacy Macy's and Bloomingdale's locations (those operating as Macy's or Bloomingdale's prior to September 2006). Federated's total sales for November 2006 and November 2005 include the May Company acquisition, which was completed Aug. 30, 2005. For the year to date, former May Company locations are included in total sales for the entire period in 2006 but only after Aug. 30 in 2005. Sales in 2006 and 2005 from the Lord & Taylor division, which Federated sold in October 2006, and the Bridal Group division, which the company is divesting, are treated as discontinued operations.
