Macy's still closing stores despite good higher holiday sales

 
 
Updated 1/4/2018 10:07 AM
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  • Macy's reported 1.1 percent growth in same-store sales during November and December, but the company said Thursday that it plans to 11 U.S. stores in the coming weeks.

    Macy's reported 1.1 percent growth in same-store sales during November and December, but the company said Thursday that it plans to 11 U.S. stores in the coming weeks. Associated Press/February 2011

It's been a tumultuous few years for the nation's department stores, but a solid holiday season has provided at least a temporary reprieve as shoppers stocked up on home goods, clothing and beauty products.

Sales at J.C. Penney stores open at least one year rose 3.4 percent in November and December compared to a year earlier. Macy's, meanwhile, reported 1.1 percent growth in same-store sales during that period led by increased demand for active apparel, shoes, dresses and coats.

"Consumers were ready to spend this season," Jeff Gennette, Macy's chief executive, said in a statement. "We saw improved sales trends in our stores and continued to see double-digit growth on our digital platforms."

Overall, holiday spending is projected to rise about 4 percent to a record $682 billion, according to the National Retail Federation, which will report final numbers late next week. Early projections show that sales rose 4.9 percent during the holidays, accounting for the largest annual increase since 2011, according to Mastercard's SpendingPulse report.

But analysts cautioned that it could still be a rocky road for companies like Macy's, which said on Thursday that it plans to close 11 U.S. stores in coming weeks. The company has already closed 124 stores since 2015, joining a number of other retailers that are paring down as more customers shop online. For 2017, Macy's says it expects total sales to be 3.6 percent to 3.9 percent lower than they were a year earlier.

"These results are simply not strong enough to suggest that Macy's has transformed the business nor that future success is guaranteed," Neil Saunders, managing director of analytics firm GlobalData Retail, wrote in a note to clients. "Growth remains relatively weak."

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