Federated Feels Hurricane’s Effects

Federated Department Stores Inc. (Cincinnati) has reported a sales decrease of 2.7 percent for the four weeks ended Aug. 28, 2004. Same-store sales were down 2.4 percent.

For the year to date, Federated’s sales are still up 4 percent from a year ago, and so are its same-store sales.

Terry J. Lundgren, Federated’s chairman, president and ceo, called August sales disappointing, citing weakness in back-to-school areas of juniors and young men’s, as well as in furniture. In addition, August sales in the company’s Florida stores (where Federated operates the Burdines-Macy’s chain and five Bloomingdale’s stores) were negatively impacted by Hurricane Charley.

“August’s same-store sales comparisons also were affected by the shift of Labor Day into the September reporting period this year,” Lundgren said. “Additionally, because August is a clearance month, tight seasonal inventories in our stores are reflected to some degree in our weaker-than-anticipated sales during the month. As we look to September, we are somewhat encouraged by sales trends we have seen in fall fashions, accessories and cosmetics. This leads us to remain hopeful of attaining a same-store sales increase of approximately 2 percent for the month.”

Lundgren said the company continues to anticipate a same-store sales increase of 1.5 to 3 percent for the third and fourth quarters.

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