Slide 1: Macy's, Inc. First Quarter 2023 Earnings Presentation
Macy’s, Inc. First Quarter 2023 Earnings Presentation June 1, 2023
Slide 2: Safe Harbor Statement
Safe Harbor Statement All statements in this presentation that are not statements of historical fact are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of Macy’s management and
Slide 3: CEO quote on first quarter results
“During the first quarter, we delivered a solid beat on our gross margin rate and bottom line expectations enabled by our disciplined teams, strength of our inventory management and operational efficiencies. We planned the year assuming that the economic health of the consumer would be challenged, b
Slide 4: 1Q23 Financial Results
1Q23 Financial Results In millions, except per share figures and percentages Net Sales Other Revenue $4,982 $191 6.8% from 1Q22 12.0% from 1Q22 Net sales were below expectations driven by macroeconomic 3.8% pressures that had a more pronounced impact on of net sales discretionary spending than antic
Slide 5: 1Q23 Financial Results (continued)
1Q23 Financial Results (continued) In millions, except per share figures and percentages Gross Margin (GM) Earnings Before Interest, Taxes, Diluted $1,994 Depreciation & Amortization (EBITDA) Earnings Per Share (EPS) 5.8% from 1Q22 $466 $0.56 31.1% from 1Q22 42.9% from 1Q22 GM Rate EBITDA Rate 40.0%
Slide 6: Capital Allocation Highlights
Capital Allocation Highlights Year-to-date free cash flow outflow of $166M & trailing twelve months free cash flow inflow of $231M • Cash flow from operating activities of $105M • Capital expenditures of $296M • Primarily focused on digital & technology investments, data & analytics, supply chain mo
Slide 7: Five Growth Vectors
Five Growth Vectors Macy’s Private Brand Reimagination Designed to drive customer loyalty, be a differentiator for the business, complement our national brands matrix and benefit gross margin. • In 1Q23, reimagined INC women’s and Club Room men’s outperformed respective broader apparel segments at M
Slide 8: Nameplate Performance
Nameplate Performance
Slide 9: Macy's 1Q23 Highlights
1Q23 Highlights Net Sales Comparable O+L Sales Top Categories -7.7% -7.9% Beauty Versus 1Q22 Versus 1Q22 Men’s Tailored Customer Highlights1 Apparel ~42.2M ~29.8M Women’s Career & Sportswear active customers1 Star Rewards active member accounts1 ~70% of Macy’s comp O+L sales were made up by Star Rew
Slide 10: Bloomingdale's 1Q23 Highlights
1Q23 Highlights Net Sales Comparable O+L Sales Top Categories -2.3% -4.3% Beauty Versus 1Q22 Versus 1Q22 Men’s and Women’s Contemporary Apparel Housewares Customer Highlights1 ~4.1M ~2.5M Active customers1 Loyallist active member accounts1 ~82% Of total Bloomingdale’s O+L sales were made up by Loyal
Slide 11: Bluemercury 1Q23 Highlights
1Q23 Highlights Net Sales Comparable Sales Top Categories +4.4% +4.3% Skincare Versus 1Q22 Versus 1Q22 Color Customer Highlights1 ~676k ~912k active customers1 Loyalty active member accounts1 ~83% Of total Bluemercury sales were made up by loyalty customers Additional Highlights Launching The Cache
Slide 12: Looking Ahead…
Looking Ahead…
Slide 13: FY23 Guidance
FY23 Guidance (on a 53-week basis unless otherwise noted) FY23 Guidance (as of 6/1/2023) FY23 Guidance (as of 3/2/2023) Net sales $22.8 billion to $23.2 billion $23.7 billion to $24.2 billion Comparable Owned + Licensed sales Approximately down 7.5% to down 6% from 2022 Approximately down 4% to down
Slide 14: 2Q23 Guidance
2Q23 Guidance 2Q23 Guidance (as of 6/1/2023) Net sales $5.0 billion to $5.1 billion Gross margin rate Down no more than 100 basis points vs 2Q22 Adjusted diluted EPS* $0.10 to $0.15 Inventories Approximately down low to mid-single digits to last year on a percentage basis • The second quarter includ
Slide 15: Additional Business Metrics
Additional Business Metrics
Slide 16: Store Count – As of April 29, 2023
Store Count – As of April 29, 2023 End of 1Q23 Change in Locations from FY22 Boxes Locations Macy's Department Stores 495 441 — Macy's Furniture 51 46 — Macy's Furniture Clearance 1 1 — Freestanding Backstage 9 9 — Macy's Small Format 8 8 — Stores converted to Fullfilment Centers 2 2 — Total Macy's
Slide 17: Remaining Long-term Debt Maturities, as of April 29, 2023
Remaining Long-term Debt Maturities, as of April 29, 2023 Notes: *% represents weighted average interest rate ** All outstanding long-term debt is unsecured
Slide 18: Appendix
Appendix
Slide 19: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures The company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP).However, management believes that certain non- GAAP financial measures provide users of the company's financial information with add
Slide 20: Changes in Comparable Sales – Macy's, Inc.
Changes in Comparable Sales – Macy's, Inc. Versus 13 weeks ended Versus 13 weeks ended Macy’s, Inc. April 30, 2022 May 1, 2021 Increase (decrease) in comparable sales on an owned basis (Note 1) (7.9%) 12.8% Impact of departments licensed to third parties (Note 2) 0.7% (0.4%) Increase (decrease) in c
Slide 21: Changes in Comparable Sales – Macy's and Bloomingdale's brands
Changes in Comparable Sales- Macy’s and Bloomingdale’s brands Versus 13 weeks ended Macy’s April 30, 2022 Decrease in comparable sales on an owned basis (Note 1) (8.7%) Impact of departments licensed to third parties (Note 2) 0.8% Decrease in comparable sales on an owned plus licensed basis (7.9%) V
Slide 22: EBITDA Excluding Certain Items
Earnings Before Interest, Taxes, Depreciation, and Amortization Excluding Certain Items 13 weeks ended 13 weeks ended Millions, except percentages April 29, 2023 April 30, 2022 Most comparable GAAP measure: Net income $155 $286 Total revenue $5,173 $5,565 Net income as a percent to total revenue 3.0
Slide 23: Net Income, Excluding Certain Items
Net Income, Excluding Certain Items 13 weeks ended 13 weeks ended Millions April 29, 2023 April 30, 2022 Most comparable GAAP measure: Net income $155 $286 Non-GAAP measure: Net income $155 $286 Impairment, restructuring and other costs 2 8 Losses on early retirement of debt — 31 Income tax impact o
Slide 24: Diluted Earnings Per Share, Excluding Certain Items
Diluted Earnings Per Share, Excluding Certain Items 13 weeks ended 13 weeks ended April 29, 2023 April 30, 2022 Most comparable GAAP measure: Diluted earnings per share $0.56 $0.98 Non-GAAP measure: Diluted earnings per share $0.56 $0.98 Impairment, restructuring and other costs — 0.03 Losses on ear
Slide 25: Free Cash Flow
Free Cash Flow 13 weeks ended Trailing Twelve Months ended Millions April 29, 2023 April 29,2023 Net cash provided by operating activities $105 $1,472 Purchase of property and equipment (215) (932) Capitalized software (81) (398) Disposition of property and equipment 25 89 Free Cash Flow $(166) $231