Cost Management to Reinvest in Growth
The company is also taking actions intended to continue improvements in organizational efficiency and to allocate resources to support its growth strategy. Major components of these restructuring activities include:
Staffing adjustments across the stores organization with reductions in some stores and increases in others;
Further streamlining in some non-store functions; and,
Closure of 11 stores in early 2018.
The company expects annual expense savings of $300 million from these actions beginning in fiscal-year 2018, which it intends to reinvest in the business. Also associated with these actions, the company anticipates one-time charges of approximately $160 million, or approximately 33 cents per share, (of which approximately $115 million is expected to be cash) to be booked in the fourth quarter of 2017 for restructuring activities, asset impairment, store closings and other costs.
Update on Store Closures
The company announced the closure of 11 Macy’s stores, 4 of which were previously disclosed. With these closures, the company will have completed 81 of the approximately 100 planned store closures announced in August 2016. The company intends to close approximately 19 additional stores as leases or operating covenants expire or sale transactions are completed. These closures are part of a multi-year effort by the company to ensure the optimal mix of brick & mortar stores and digital footprint. Including the stores announced today, Macy’s, Inc. has closed 124 stores since 2015. A list of stores scheduled to close in early 2018 is included at the end of this news release.