Macy's, Inc. (NYSE:M) Q1 2018 Earnings Conference Call - Final Transcript

May 16, 2018 • 09:30 am ET

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Macy's, Inc. (NYSE:M) Q1 2018 Earnings Conference Call - Final Transcript

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Operator
Operator

Good morning and welcome to Macy's First Quarter 2018 Earnings Conference Call. Today's call is being recorded. I would now like to turn the call over to your host, Karen Hoguet. Please go ahead.

Executive
Karen Hoguet

Hi, good morning, everyone. And Jeff Gennette, our Chairman and CEO, and I would like to welcome you to the Macy's call to discuss our first quarter earnings and our outlook for the remainder of the year. Any transcription or other reproduction of the statements made in this call without our consent is prohibited. A replay of the call will be available on our website, www.macysinc.com, beginning approximately two hours after the call concludes.

Please refer to the Investor Relations Section of our website for discussion and reconciliation of any non-GAAP financial measures discussed this morning. Keep in mind that all forward-looking statements are subject to risks and uncertainties that could cause the company's actual results to differ materially from the expectations and assumptions mentioned today due to a variety of factors that affect the company, including the risk specified in the company's most recent Form 10-K and other SEC filings.

I am now going to turn the call over to Jeff.

Executive
Jeff Gennette

Thank you, Karen, and good morning everyone and welcome to the call. As you saw in this morning's release, we continued our momentum from the holiday season into the first quarter. In fact, exceeding our own expectations on most measures. We delivered adjusted earnings per share of $0.48. Comparable store sales were up 4.2% on an owned plus license basis, and when adjusted for the estimated impact of the shift up in friends and family from the second quarter to the first quarter, comparable store sales were up 1.7% for owned plus license.

I'm pleased to report strong performance across all three brands, Macy's, Bloomingdale's, and Bluemercury, across all families of business and all regions of the country. And it's very encouraging to see the continued improvement in our brick and mortar business. We still have a lot of work ahead of us, but store by store, quarter by quarter, we are on the path to return Macy's Inc. to consistent comparable store sales growth. Based on the strong start to the year, and the healthy macro environment, we are raising both earnings and sales guidance for the year. We now anticipate annual comparable store sales in the 1% to 2% range for owned plus licensed, which is a one-point lift from our prior guidance. And we anticipate that annual earnings per share will be in the $3.75 to $3.95 range, which is up $0.20 from our prior guidance.

Karen will take you through the details of the quarter, and give you some additional context on guidance, but before she does, I want to give you some perspective on the first quarter and an update on our strategic initiatives.

So, looking at the quarter, we did have the wind at our back as consumer spending remained strong and we saw significant improvement in international tourism