Federated reports higher sales, earnings in 1996.CINCINNATI--(BUSINESS WIRE)--March 4, 1997-- Operating Income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. Up 22%, Earnings Up 68%, Exclusive of Non-Recurring Costs Federated Connected and treated as one. See federated database and federated directories. Department Stores This is a list of department stores. In the case of department store groups the location of the flagship store is given. This list does not include large specialist stores, which sometimes resemble department stores. , Inc. today reported fourth quarter and fiscal 1996 results that reflected strong operating performance in its retail divisions. The company's operating income for the year increased 22.3 percent and earnings increased 68.7 percent over the prior year, exclusive of non-recurring costs in both years that were related primarily to the integrations of Broadway Broadway, famous thoroughfare in New York City. It extends from Bowling Green near the foot of Manhattan island N to 262d St. in the Bronx. Throughout its length Broadway is chiefly a commercial street. Stores, Inc. and R. H. Macy
"1996 was an exceptionally good year for Federated," said Allen Al·len , Edgar 1892-1943. American anatomist who is noted for his studies of hormones and for the discovery (1923) of estrogen. Questrom, chairman and chief executive officer. "We are very pleased with the solid gains in net income for the year, which we believe reflects our ability to successfully integrate major acquisitions while continuing to improve performance in our existing stores. We also were pleased with the year's 3.1 percent increase in comp-store sales, which we believe demonstrates that our strategies are working well." Net Income For the 52 weeks ended February February: see month. 1, 1997, Federated posted net income of $453.4 million or $2.18 a share, compared to net income of $268.7 million or $1.40 a share for the 53-week 1995 fiscal year, excluding components of cost of sales and selling, general and administrative expenses that consist of inventory valuation adjustments and other business integration and consolidation expenses (BICE n. 1. (Paint.) A pale blue pigment, prepared from the native blue carbonate of copper, or from smalt; - called also blue bice ltname>. Green bice is prepared from the blue, by adding yellow orpiment, or by grinding down the green carbonate of copper. - Cooley. ) from both periods, as well as last year's $25.6 million contribution to the Federated Department Stores Foundation for funding charitable giving programs of the corporation. Including BICE and last year's charitable contribution charitable contribution n. in taxation, a contribution to an organization which is officially created for charitable, religious, educational, scientific, artistic, literary, or other good works. , Federated's net income was $265.9 million or $1.28 a share, compared to net income of $74.6 million or 39 cents a share for the 53 weeks ended February 3, 1996. For the 13 weeks ended February 1, 1997, Federated's net income was $342.5 million or $1.65 a share, excluding $87.7 million, before income taxes, of BICE. Including BICE, Federated posted fourth quarter net income of $289.2 million or $1.39 a share. The company's results in the fourth quarter this year compare to net income of $295.0 million or $1.46 a share for the 14-week fourth quarter of 1995, excluding BICE totaling $82.5 million, before income taxes. Including BICE, Federated posted net income of $244.9 million or $1.21 a share in the fourth quarter last year. Operating Income Operating income for the 52 weeks of fiscal 1996 was $1,201.8 million or 7.9 percent of sales, an increase of 22.3 percent over operating income of $982.4 million or 6.5 percent of sales for fiscal 1995, excluding BICE from both periods and last year's charitable contribution. Including these expenses, operating income for the 52 weeks of fiscal 1996 was $893.2 million, compared to $662.9 million for the 53-week 1995 fiscal year. Operating income for the 13-week fourth quarter of 1996 was $662.6 million or 13.2 percent of sales, an increase of 5.6 percent over operating income of $627.7 million or 11.9 percent of sales for the fourth quarter of 1995, excluding BICE for both this year and last. Including these expenses, operating income for the fourth quarter of 1996 was $574.9 million, compared to $545.3 million for the 14-week fourth quarter last year. Sales For the 52-week 1996 fiscal year, Federated's sales were $15,229.0 million, an increase of 1.2 percent compared to sales of $15,048.5 million for the 53-week 1995 fiscal year. During the second half of 1995, Federated operated 26 Broadway stores that subsequently were sold or closed. On a comparable-store basis, Federated's annual sales for fiscal 1996 increased 3.1 percent over sales in the first 52 weeks of fiscal 1995. For the 13-week fourth quarter of 1996, Federated's sales totaled $5,035.0 million, a decrease of 4.4 percent compared to sales of $5,264.9 million for the 14-week fourth quarter of 1995. In addition to the extra week of sales for the fourth quarter of 1995, Federated during that period operated 26 Broadway stores that subsequently were sold or closed. On a comparable-store basis, Federated's fourth quarter sales increased 4.0 percent compared to the first 13 weeks of the fourth quarter last year. Outlook for 1997 "Federated's primary objective for 1997 is to focus on the aggressive execution of our current strategies, with the goal of producing comp-store sales growth and further improving our earnings performance," Questrom said. He added that in doing so, the company will continue to expand its private brands merchandise MERCHANDISE. By this term is understood all those things which merchants sell either wholesale or retail, as dry goods, hardware, groceries, drugs, &c. It is usually applied to personal chattels only, and to those which are not required for food or immediate support, but such as remain program, in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with building stronger vendor partnerships. "Additionally," Questrom said, "Federated will continue to focus on producing additional cost savings from operational improvements and enhanced efficiencies in key areas of our business." Federated, with corporate offices in Cincinnati Cincinnati (sĭnsənăt`ē, –năt`ə), city (1990 pop. 364,040), seat of Hamilton co., extreme SW Ohio, on the Ohio River opposite Newport and Covington, Ky.; inc. as a city 1819. and New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , is one of the nation's leading department store retailers, with annual sales of more than $15 billion. Federated currently operates more than 400 department stores and 150 specialty stores Noun 1. specialty store - a store that sells only one kind of merchandise shop, store - a mercantile establishment for the retail sale of goods or services; "he bought it at a shop on Cape Cod" in 36 states. Federated's department stores operate nationally under the names of Bloomingdale's This article or section needs sources or references that appear in reliable, third-party publications. Alone, primary sources and sources affiliated with the subject of this article are not sufficient for an accurate encyclopedia article. , The Bon Marche Marche, region, Italy Marche (mär`kā) or the Marches, region (1991 pop. 1,429,205), 3,742 sq mi (9,692 sq km), E central Italy, extending from the eastern slopes of the Apennines to the Adriatic Sea. , Burdines The references in this article would be clearer with a different and/or consistent style of citation, footnoting or external linking. Burdines was a leading department store chain in the state of Florida that was part of Federated Department Stores, Inc. , Goldsmith's Goldsmith's was a department store founded in Memphis, Tennessee in 1870 by German immigrant brothers Jacob and Isaac Goldsmith, who, with a $500 investment, opened a dry goods store on a muddy lane called Beale Street. , Lazarus Lazarus (lăz`ərəs) [Gr.,=Heb., Eleazar], in the New Testament. 1 Brother of Mary and Martha of Bethany who, after four days in the tomb, was brought back to life by Jesus. , Macy's Macy's formerly R.H. Macy & Co., Inc. Major U.S. department-store chain. Its former flagship, an 11-story store that occupies a city block in New York City's Herald Square, was for many years the largest single store in the country. Rowland H. , Rich's
Rich's was a major department store retail chain, headquartered in Atlanta, Georgia, that operated in the southern U.S. and Stern's Stern's was a regional department store chain serving the U.S. states of New York, Pennsylvania, and New Jersey. The chain was in business for more than 130 years, prior to its 2001 integration into Macy's and Bloomingdale's. . (NOTE: Information on Federated and its operating divisions is available on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at http://www.federated-fds.com Copies of past press releases and corporate background data also are available by calling Fax-On-Demand at 1-800-853-9150.) -0-
FEDERATED DEPARTMENT STORES, INC.
Consolidated Statements of Income (Unaudited) (Note 1)
_______________________________________________________
(All amounts in thousands except percentages and per share figures)
Consolidated Statements Analytical Results
of Income (Note 6)
________________________ ________________________
52 Weeks 53 Weeks 52 Weeks 53 Weeks
Ended Ended Ended Ended
February 1, February 3, February 1, February 3,
1997 1996 1997 1996
___________ ___________ ___________ ___________
Net Sales $15,228,999 $15,048,513 $15,228,999 $15,048,513
___________ ___________ ___________ ___________
Cost of sales:
Recurring
(Note 2) 9,288,686 9,317,784 9,288,686 9,317,784
Inventory valuation
adjustments
related to
consolidation
(Note 3) 65,681 91,637 - -
___________ ___________ ___________ ___________
Total cost of sales 9,354,367 9,409,421 9,288,686 9,317,784
Percent to sales 61.4% 62.5% 61.0% 61.9%
Selling, general and
administrative expenses:
Recurring (Note 4) 4,738,483 4,748,331 4,738,483 4,748,331
Business integration
and consolidation
expenses (Note 5) 242,950 202,293 - -
Charitable
contribution to
Federated Department
Stores Foundation - 25,581 - -
___________ ___________ ___________ ___________
Total selling, general
and administrative
expenses 4,981,433 4,976,205 4,738,483 4,748,331
Percent to sales 32.7% 33.1% 31.1% 31.6%
___________ ___________ ___________ ___________
Operating Income 893,199 662,887 1,201,830 982,398
Percent to sales 5.9% 4.4% 7.9% 6.5%
Interest expense
- net (451,764) (461,028) (451,764) (461,028)
___________ ___________ ___________ ___________
Income Before Income
Taxes 441,435 201,859 750,066 521,370
Federal, state and
local income tax
expense (175,571) (127,306) (296,632) (252,634)
___________ ___________ ___________ ___________
Net Income $ 265,864 $ 74,553 $ 453,434 $ 268,736
___________ ___________ ___________ ___________
___________ ___________ ___________ ___________
FEDERATED DEPARTMENT STORES, INC.
Consolidated Statements of Income (Unaudited)
_____________________________________________
(All amounts in thousands except percentages and per share figures)
Consolidated Statements Analytical Results
of Income (Note 6)
______________________ ____________________
52 Weeks 53 Weeks 52 Weeks 53 Weeks
Ended Ended Ended Ended
February 1, February 3, February 1, February 3,
1997 1996 1997 1996
__________ __________ _________ ________
Earnings per share $ 1.28 $ .39 $ 2.18 $ 1.40
_______ _______ _______ _______
_______ _______ _______ _______
Average Number of Shares
Outstanding 207,537 191,503 207,537 191,503
_______ _______ _______ _______
_______ _______ _______ _______
Notes: (1) Certain reclassifications have been made to prior year amounts to conform with the classification of such amounts for the current year. (2) Substantially all merchandise inventories are valued by the retail method and stated on the LIFO (Last In-First Out) A queueing method in which the next item to be retrieved is the item most recently placed in the queue. Contrast with FIFO. LIFO - stack (last-in, first-out last-in, first-out n. A method of inventory accounting in which the most recently acquired items are assumed to have been the first sold. In a period of rising prices, this method yields a lower ending inventory, a higher cost of goods sold, a lower ) basis, which is generally lower than market. Application of this method did not impact the 52 weeks ended February 1, 1997 or the 53 weeks ended February 3, 1996. (3) Represents inventory valuation adjustments to merchandise in lines of business which were eliminated or replaced in connection with the integration of Broadway into the Company for the 52 weeks ended February 1, 1997 and in connection with the integration of Macy's into the Company and the consolidation of the Rich's/Goldsmith's and Lazarus divisions for the 53 weeks ended February 3, 1996. Prior to reclassification Reclassification The process of changing the class of mutual funds once certain requirements have been met. These requirements are generally placed on load mutual funds. Reclassification is not considered to be a taxable event. as described in Note 1 above, such adjustments (together with the expenses described in Note 5 below) had been separately reported in prior periods as "business integration and consolidation expenses" rather than as a component of cost of sales. (4) Includes depreciation and amortization expense of $533,362,000 and $496,911,000 for the 52 weeks ended February 1, 1997 and 53 weeks ended February 3, 1996, respectively. (5) For the 52 weeks ended February 1, 1997, consists of $167,737,000 of costs associated with the integration of Broadway into the Company, $33,685,000 of costs related to the consolidation of Macy's and $41,528,000 of costs related to other support operation restructurings, primarily the centralization cen·tral·ize v. cen·tral·ized, cen·tral·iz·ing, cen·tral·iz·es v.tr. 1. To draw into or toward a center; consolidate. 2. of the Company's merchandise distribution function. For the 53 weeks ended February 3, 1996, consists of $139,851,000 of costs associated with the integration of Macy's, $48,060,000 of costs associated with the integration of Broadway and $14,382,000 of costs related to the consolidation of the Rich's/Goldsmith's and Lazarus divisions. Prior to reclassification as described in Note 1 above, such expenses (together with the adjustments described in Note 3 above) had been separately reported in prior periods as "business integration and consolidation expenses" rather than as a component of selling, general and administrative expenses. (6) Analytical analytical, analytic pertaining to or emanating from analysis. analytical control control of confounding by analysis of the results of a trial or test. results exclude the impact of inventory valuation adjustments related to consolidation, business integration and consolidation expenses and the charitable contribution to the Federated Department Stores Foundation. Such results are presented as supplemental information only, do not constitute a presentation in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting and are not necessarily indicative indicative: see mood. of Federated's future results of operations. -0-
FEDERATED DEPARTMENT STORES, INC.
Consolidated Statements of Income (Unaudited) (Note 1)
_______________________________________________________
(All amounts in thousands except percentages and per share figures)
Consolidated Statements Analytical Results
of Income (Note 6)
__________________________ _______________________
13 Weeks 14 Weeks 13 Weeks 14 Weeks
Ended Ended Ended Ended
February 1, February 3, February 1, February 3,
1997 1996 1997 1996
___________ ___________ ___________ ___________
Net Sales $ 5,034,958 $ 5,264,889 $ 5,034,958 $ 5,264,889
___________ ___________ ___________ ___________
Cost of sales:
Recurring
(Note 2) 3,088,562 3,302,371 3,088,562 3,302,371
Inventory
valuation
adjustments
related to
consolidation
(Note 3) - 1,031 - -
___________ ___________ ___________ ___________
Total cost of
sales 3,088,562 3,303,402 3,088,562 3,302,371
Percent to sales 61.3% 62.7% 61.3% 62.7%
Selling, general
and administrative
expenses:
Recurring
(Note 4) 1,283,805 1,334,805 1,283,805 1,334,805
Business
integration and
consolidation
expenses (Note 5) 87,722 81,420 - -
___________ ___________ ___________ ___________
Total selling,
general and
administrative
expenses 1,371,527 1,416,225 1,283,805 1,334,805
Percent to sales 27.3% 26.9% 25.5% 25.4%
___________ ___________ ___________ ___________
Operating Income 574,869 545,262 662,591 627,713
Percent to sales 11.4% 10.4% 13.2% 11.9%
Interest expense
- net (110,508) (129,971) (110,508) (129,971)
___________ ___________ ___________ ___________
Income Before
Income Taxes 464,361 415,291 552,083 497,742
Federal, state
and local income
tax expense (175,159) (170,418) (209,569) (202,759)
___________ ___________ ___________ ___________
Net Income $ 289,202 $ 244,873 $ 342,514 $294,983
___________ ___________ ___________ ___________
___________ ___________ ___________ ___________
FEDERATED DEPARTMENT STORES, INC.
Consolidated Statements of Income (Unaudited)
_____________________________________________
(All amounts in thousands except percentages and per share figures)
Consolidated Statements Analytical Results
of Income (Note 6)
____________________ ____________________
13 Weeks 14 Weeks 13 Weeks 14 Weeks
Ended Ended Ended Ended
February 1, February 3, February 1, February 3,
1997 1996 1997 1996
_______ _______ _______ _______
Earnings per share $ 1.39 $ 1.21 $ 1.65 $ 1.46
_______ _______ _______ _______
_______ _______ _______ _______
Average Number of Shares
Outstanding 207,957 202,631 207,957 202,631
_______ _______ _______ _______
_______ _______ _______ _______
Notes: (1) Certain reclassifications have been made to prior period amounts to conform with the classification of such amounts for the current period. (2) Substantially all merchandise inventories are valued by the retail method and stated on the LIFO (last-in, first-out) basis, which is generally lower than market. Application of this method did not impact the 13 weeks ended February 1, 1997 and resulted in a credit of $1,761,000 for the 14 weeks ended February 3, 1996. (3) Represents inventory valuation adjustments to merchandise in lines of business which were eliminated or replaced in connection with the integration of Macy's into the Company and the consolidation of the Rich's/Goldsmith's and Lazarus divisions for the 14 weeks ended February 3, 1996. Prior to reclassification as described in Note 1 above, such adjustments (together with the expenses described in Note 5 below) had been separately reported in prior periods as "business integration and consolidation expenses" rather than as a component of cost of sales. (4) Includes depreciation and amortization expense of $131,452,000 and $132,033,000 for the 13 weeks ended February 1, 1997 and 14 weeks ended February 3, 1996, respectively. (5) For the 13 weeks ended February 1, 1997, consists of $50,848,000 of costs associated with the integration of Broadway into the Company, $11,821,000 of costs related to the consolidation of Macy's and $25,053,000 of costs related to other support operation restructurings, primarily the centralization of the Company's merchandise distribution function. For the 14 weeks ended February 3, 1996, consists of $36,572,000 of costs associated with the integration of Macy's, $40,719,000 of costs associated with the integration of Broadway and $4,129,000 of costs related to the consolidation of the Rich's/Goldsmith's and Lazarus divisions. Prior to reclassification as described in Note 1 above, such expenses (together with the adjustments described in Note 3 above) had been separately reported in prior periods as "business integration and consolidation expenses" rather than as a component of selling, general and administrative expenses. (6) Analytical results exclude the impact of inventory valuation adjustments related to consolidation and business integration and consolidation expenses. Such results are presented as supplemental information only, do not constitute a presentation in accordance with generally accepted accounting principles and are not necessarily indicative of Federated's future results of operations. -0-
FEDERATED DEPARTMENT STORES, INC.
Analytical Operating Results (Unaudited) (Note 1)
_________________________________________________
(All amounts in thousands except percentages and per share figures)
14 Weeks 53 Weeks
Ended Ended
February 3, February 3,
1996 1996
___________ ___________
Net Sales $ 4,629,435 $13,998,218
Cost of sales (Note 2) 2,852,159 8,578,611
Percent to sales 61.6% 61.3%
Selling, general and administrative
expenses (Note 3) 1,179,372 4,424,533
Percent to sales 25.5% 31.6%
___________ ___________
Operating Income 597,904 995,074
Percent to sales 12.9% 7.1%
Interest expense - net (107,880) (413,265)
___________ ___________
Income Before Income Taxes 490,024 581,809
Federal, state and local income tax
expense (198,820) (249,026)
___________ ___________
Net Income $ 291,204 $ 332,783
___________ ___________
___________ ___________
Earnings per Share $ 1.59 $ 1.82
___________ ___________
___________ ___________
Average Number of Shares Outstanding 183,238 182,952
___________ ___________
___________ ___________
FEDERATED DEPARTMENT STORES, INC.
Analytical Operating Results (Unaudited) (Note 1)
_________________________________________________
(All amounts in thousands except percentages and per share figures)
Notes: (1) Analytical results exclude the impact of the cost of sales and selling, general and administrative expenses components of business integration and consolidation expenses, the impact of the charitable contribution to Federated Department Stores Foundation and the impact of the Broadway acquisition on Federated's consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: operations, interest expense and per-share earnings. Such results are presented as supplemental information only, do not constitute a presentation in accordance with generally accepted accounting principles and are not necessarily indicative of Federated's future results of operations. (2) Substantially all merchandise inventories are valued by the retail method and stated on the LIFO (last-in, first-out) basis, which is generally lower than market. Application of this method resulted in a credit of $1,761,000 for the 14 weeks ended February 3, 1996 and did not impact the 53 weeks ended February 3, 1996. (3) Includes depreciation and amortization expense of $121,564,000 for the 14 weeks ended February 3, 1996 and $474,945,000 for the 53 weeks ended February 3, 1996. 1996 Sales by Division ______________________ The Company's eight retail operating divisions are Bloomingdale's, The Bon Marche, Burdines, Macy's East, Macy's West Macy's West is a division of Macy's, Inc. (formerly Federated Department Stores) and headquartered in San Francisco, California. It currently operates approximately 200 stores throughout Arizona, California, Colorado, Guam, Hawaii, Nevada, New Mexico and Texas. , Rich's/Lazarus/Goldsmith's, Stern's, and Macy's Specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. . The following table sets forth certain information with respect to the Company's retail operating divisions: -0-
Number of 1996
Stores Sales
_________ _________
(millions)
Bloomingdale's 21 $ 1,595.0 (a)
The Bon Marche 42 892.4
Burdines 48 1,333.4
Macy's East 90 4,541.0
Macy's West 109 3,714.2
Rich's/Lazarus/Goldsmith's 76 2,105.5
Stern's 25 880.7
Macy's Specialty 153 166.8
____ _________
Total 564 $15,229.0
____ _________
____ _________
(a) Includes $136.7 million of sales of the Company's
Bloomingdale's By Mail subsidiary.
FEDERATED DEPARTMENT STORES, INC.
CONSOLIDATED BALANCE SHEETS (Unaudited)
_______________________________________
(thousands)
February 1, 1997 February 3, 1996
________________ _________________
ASSETS
Current Assets:
Cash $ 148,794 $ 172,518
Accounts receivable 2,834,321 2,842,077
Merchandise inventories 3,245,996 3,094,848
Supplies and prepaid expenses 109,678 176,411
Deferred income tax assets 88,513 74,511
____________ ___________
Total Current Assets 6,427,302 6,360,365
Property and Equipment - net 6,524,757 6,305,167
Intangible Assets - net 717,404 744,689
Notes Receivable 204,400 415,066
Other Assets 390,280 469,763
____________ ___________
Total Assets $14,264,143 $ 14,295,050
____________ ___________
____________ ___________
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Short-term debt $ 1,094,557 $ 733,115
Accounts payable and accrued
liabilities 2,492,195 2,358,543
Income taxes 8,947 6,411
____________ ___________
Total Current Liabilities 3,595,699 3,098,069
Long-Term Debt 4,605,916 5,632,232
Deferred Income Taxes 830,943 732,936
Other Liabilities 562,431 558,127
Shareholders' Equity 4,669,154 4,273,686
____________ ___________
Total Liabilities and
Shareholders' Equity $14,264,143 $14,295,050
____________ ___________
____________ ___________
Ratio of total debt to total
capitalization (excluding Note
Monetization Facility) 53.4% 58.5%
____________ ___________
____________ ___________
CONTACT: Federated Department Stores, Inc. Media: Carol Sanger Sanger, city (1990 pop. 16,839), Fresno co., S central Calif., in the San Joaquin Valley; inc. 1911. It is a shipping and processing center for a variety of agricultural products. Manufactures include sheet metal products, wine, machinery, and corrugated boxes. , 513/579-7764 Investor: Susan SUSAN Smallest Univalue Segment Assimilating Nucleus SUSAN Sub Saharan African Network SUSAN Smart Ultrasonic System for Aircraft NDE Robinson, 513/579-7780 |
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