(Reuters) - Macy’s Inc (M.N) said sales and margins in the current quarter would be hurt by disruptions at U.S. West Coast ports, and the retailer forecast full-year profit and revenue that fell short of analysts’ expectations.
Inventory levels, particularly for imported apparel and accessories, have been hurt by congestion at the ports due to the months-long labor dispute, the retailer said on Tuesday.
“Approximately 12 percent of our first-quarter merchandise receipts are being delayed, and this will have some impact on our sales, gross margin and expense in the first few months of the year,” Chief Financial Officer Karen Hoguet said on a call.
Retailers and other companies are bracing for further shipment delays as it may take as much as two months for the congestion at the ports to clear even after a tentative labor agreement on Feb. 20.
Macy’s shares fell as much as 4.8 percent to $61.10. The stock has risen nearly 20 percent in the past year.
The company, which operates the upscale Bloomingdale’s chain as well as its namesake stores, forecast earnings of $4.70-$4.80 per share for the year ending January 2016, below the average analyst estimate of $4.84, according to Thomson Reuters I/B/E/S.
Macy’s said it would boost spending by 6 percent to $1.2 billion this year, partly to open so-called “off-price” stores that sell items such as seconds, canceled orders and returned goods at lower prices.
Macy’s is looking to broaden its customer base by attracting shoppers hunting for deals and discounts in a highly competitive retail environment.
“The off-price sector remains quite well-positioned, given consumers’ admiration of the brand offerings and treasure hunt atmosphere...,” Nomura Equity Research analyst Robert Drbul wrote in a client note.
Macy’s said it expected same-store sales growth to accelerate to about 2 percent this year from 0.7 percent last year. But total sales are expected to grow only about 1 percent to $28.39 billion, shy of the average estimate of $28.63 billion.
Macy’s net income fell 2.2 percent to $793 million in the fourth quarter ended Jan. 31. However, earnings-per-share rose to $2.26 from $2.16 due to a lower share count.
Excluding items, the company earned $2.44 per share, beating the average estimate of $2.40.
Net sales rose a lower-than-expected 1.8 percent to $9.36 billion.
Editing by Maju Samuel, Savio D'Souza and Ted Kerr