Macy's expects a first-quarter operating loss of between $905 million and $1.1 billion on sales of around $3 billion, down from $5.5 billion a year ago, the company reported.
In the announcement, Macy's named Felicia Williams, its controller and enterprise risk officer, as interim CFO, following CFO Paula Price's May 31 departure.
In order to support a well-ordered transition as Macy's slowly looks towards a full reopening, outgoing CFO Price, who had been in the position for less than two years, will remain an advisor through November 2020. Williams officially takes the reins as CFO on June 1, and will serve on an interim basis until a permanent replacement has been named.
"COVID-19 has impacted the lives of many of our colleagues and customers, and health and safety remain our top priority," chairman and CEO Jeff Gennette said. He had ordered the closing of all Macy's, Bloomingdale's, and Bluemercury stores on March 18, which he said caused a significant negative impact on the chain's first quarter results.
The company saw a steady digital business uptick in April, but that only partially offset the loss of in-store sales, Gennette said. "We are closely watching consumer behavior as we reopen more stores, and we remain flexible as we navigate this crisis. We expect business to recover gradually."
Even if, as Gennette mentioned, more and more locations reopen their doors, financial hardship may continue apace. Macy's expects its second quarter profits to be pressured even more than during the first quarter, management said Thursday morning during a virtual fireside chat with J.P. Morgan analyst Matt Boss, CNBC reported. Management said promotional activity will heighten to try selling stale merchandise.
"The scale of the deterioration underlines the fact that Macy's has a very high cost base that, even with furloughs, simply drains the business when trade declines," GlobalData Retail Managing Director Neil Saunders said in a note to clients, obtained by CNBC. "Macy's struggles to maintain sales levels because much of what it sells is just not that compelling."
Williams has worked in the finance department at Macy's Cincinnati headquarters since 2004, and has served as both controller and chief risk officer 2016. Previously, Williams was a vice president, responsible for enterprise risk and internal audit. Prior to joining Macy’s, Inc., Williams, a CPA, held various roles at The Coca-Cola Company and Bristol-Myers Squibb.
Macy's has begun a search for Price's permanent replacement. On Wednesday, Price told The Wall Street Journal she was pleased with the appointment, but declined to comment further.
Representatives for Williams and for Macy's did not respond to requests for comment.