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Macy's shares jump on restructuring, layoffs news

By: AP Email
By: AP Email

CINCINNATI (AP) -- Macy's shares rose 8 percent Thursday after the company announced Wednesday it would eliminate 2,500 jobs as part of a reorganization. The retail giant also came out with a forecast for 2014 that was better than Wall Street expected.

Wednesday Macy's Inc. announced it will eliminate 2,500 jobs and close several stores, as part of a reorganization to sustain its profitability. The Eau Claire Macy's at Oakwood Mall is not on the closure list.

The announcement comes on the heels of a strong holiday shopping season for the department store chain.

Macy's said Wednesday that it will reassign or transfer some workers and add some positions, leaving its workforce level at about 175,000.

The Cincinnati-based company plans to close five stores, including the one at Mesa's Fiesta Mall, and open eight others, leaving it with 844 stores nationwide once the changes are complete.

"Our stores remain a very important component of our omnichannel strategy for both the Macy’s and Bloomingdale’s brands," said Terry J. Lundgren, Macy’s, Inc. chairman, president and chief executive officer. "We continue to maintain a very strong nationwide network of stores through an ongoing process of selectively adding new locations while also trimming those that no longer meet our performance requirements or where our leases were not renewed."

The Fiesta Mall closure means about 100 local employees will lose their jobs.

Macy's says the moves will save it $100 million per year and forecast a 2014 profit above Wall Street's forecasts.

The news sent its shares up 5.5 percent in after-hours trading.

Macy's at Fiesta Mall is the second anchor store to go in recent years. Dillard's closed a couple of years ago, but eventually reopened as a clearance center with reduced hours.

"I worry about the area -- greatly," one local homeowner told 3TV's Jason Volentine. "Being a homeowner, it's not good for home prices. ... For this area, it's just another hit that we don't need."

The Fiesta Mall Macy's will launch a going-out-of-business sale on Jan. 13, so shoppers can expect some deep discounts.

Macy's Inc. has not given a specific date to the Fiesta Mall closure, saying only that final sales will last several weeks.


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