Macy's Reports Lower-Than-Expected Sales, Not To Form REIT

Macy's Inc (M.N) reported lower-than-expected quarterly net sales as customers cut back on expenditure and a strong dollar discouraged tourists from spending at its stores.

The department store operator also said on Wednesday it was not pursuing formation of a real estate investment trust at this time, but was exploring redevelopment of some flagship properties through joint ventures or other deals.

Shares of the operator of Macy's and Bloomingdale's stores fell nearly 6 percent in premarket trading.

Macy's same-store sales fell 3.6 percent in the third quarter, the third straight quarter of decline. Analysts on average had expected 0.2 percent growth, according to research firm Consensus Metrix.

U.S. customers have cut back their discretionary spending, choosing instead to pay back loans and spend on eating out.

Net income attributable to shareholders fell 45.6 percent to $118 million, or 36 cents per share, in the quarter ended Oct. 31, partly due to an impairment charge of $111 million related to closure of some stores.

Net sales fell 5.2 percent to $5.87 billion, the third straight quarter of decline.

Excluding items, Macy's earned 56 cents per share.

Analysts on average had expected a profit of 54 cents per share and revenue of $6.09 billion, according to Thomson Reuters I/B/E/S.

Macy's shares were trading at $44.41 before the bell.