Macys Lowers Q2 Profit Forecast After Protests Delay Merchandise

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By J Maslow

Macy’s Inc. (NYSE: M) lowered its second quarter profit forecast after protests on the West Coast delayed shipments and forced the company to mark down merchandise. A strong dollar is also to blame as foreign tourists are spending less in Macy’s stores.

Macy’s announced in February that 12% of its first-quarter merchandise was delayed because of the West Coast port strikes. The company stated that this would negatively affect sales, expenses and gross margin for the first few months of 2015.

First-quarter sales from foreign tourist were down in the double digits percentage because of a stronger dollar.

Macy’s also reported a profit decline in the first quarter. The company said profits were hurt by February’s unusually cold weather.

Same-store sales were down 0.1%, but analysts were expecting 1% growth from the company.

The company expects its profits to be less than 80 cents per share in the second quarter. This will mark the third straight quarter of losses for the company.

Macy’s has boosted its share repurchase program by $1.5 billion. The company’s total outstanding authorization is now at $2.1 billion. The company also increased its quarterly dividend to 36 cents per share, up from 31.25 cents per share.

Company shares dropped 3% to $63.40 Wednesday morning.

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