Macy's shares plunge as FY profit forecast lowered

(Sharecast News) - Shares in Macy's fell sharply after the department store chain owner lowered full-year profit forecasts on weak demand ahead of the crucial holiday sales season. The company on Wednesday said third-quarter earnings came in at $28m, or 10 cents a share, compared with $41m, or 15 cents a share a year ago.

Macy's now expects annual earnings per share to be $2.25 - $2.50, down from its previous estimate of $2.34 - $2.69. However, it lifted sales forecasts to $22.3bn - $22.5bn, up from previous guidance of $22.1bn - $22.4bn. Shares in the company fell almost 12% in early trade on Wall Street.

The quarterly report was delayed after the company discovered last month that an employee intentionally hid as much as $154m in company expenses over several years. Macy's on Wednesday said its independent investigation of the incident was now complete.

It found that the employee hid $151m in company delivery expenses and there would be no material impact to the company's finances. It also said it was strengthening existing controls and implementing additional changes designed to prevent a recurrence.

Reporting by Frank Prenesti for Sharecast.com