Macy's, Inc. (NYSE:M) Q3 2019 Earnings Conference Call - Final Transcript
Nov 21, 2019 • 08:00 am ET
Thank you. [Operator Instructions] And we'll now take our first question. It comes from Matthew Boss of J.P. Morgan. Please go ahead.
Thanks, and thanks for all the color, Jeff. So Jeff, maybe outside of your Growth 150, what's the turnaround timeline for the remaining 50% of the business? And given your comment today regarding lower tier malls, any update to the fleet size over time? Or just how you're thinking about some of those lower tier centers?
Yeah. Hi, Matt. So let's just -- I'm going to start with just when you look at the initiatives that we have employed that are driving our business right now. So destination businesses, Backstage, Growth 150, all those are working. And I'm going to have Hal add some color on the initiatives as well as one of the things that we've been under reinvest, which is really the ready-to-wear business. So I'm going to have him talk about that.
When you talk about the other opportunities that we have with our store fleet, we'll also give you a sense of where that is by tier. And so Hal is also going to address that about where our business is. What I would say about our malls is that, we're investing and our mall developers are investing, we're getting great outcomes. So when you look at the Growth 150 strategy, which basically touches over 50% of our brick-and-mortar business, we're complete with all that work and we're taking these revitalized stores into the fourth quarter with us. And in most cases, you've also got mall developers that have also enhanced those mall properties.
So we're ready. I think our mall developers are ready. But the point I'd make on the rest of our stores is that we're all dressed and ready for a very successful fourth quarter. So I'm going to turn it over first really to Hal, he'll kind of give you some more color about some of the initiatives that we're working on right now as well as that we're building a ready-to-wear, and then also ask him to comment on some of the store segmentation, some of the malls that you're referring to.
Hi, good morning. As Jeff mentioned, we remain confident in our strategic initiatives. Specifically on our Growth stores, we've completed 100 this year, and they're ready for the holiday season. The trend variance, the performance in our Growth stores continues to be strong and better than the rest of our store base with a nice uplift that we -- that is significant in nature.
As it relates to Backstage, Backstage continues to exceed our expectations and specifically exceeded our expectations for the quarter. And this is very much driven by locations that have been opened up for more than a year. Those locations are running up mid-single digits year-over-year. And the locations are also improving in margin in turn. And we remain very confident in our Backstage initiative, Macy's get stronger and stronger in off-price every single day.