Macy’s Offers $1.1 Billion of Notes to Help Repay Credit Facility
Shares of Macy’s (M) – Get Report were higher after the Cincinnati retailer said it was offering $1.1 billion of notes to help repay its revolving credit facility. The department store chain will repay its credit facility after a $1.5 billion drawdown in March as it temporarily closed stores and limited business to direct-to-consumer in the wake of the coronavirus pandemic. The senior notes are due 2025 and will be sold in a private offering. Macy’s said it would use the offering proceeds plus cash on hand to repay the credit line.Earlier this month, Macy’s said it was delaying the report of its full first-quarter results until July 1 due to coronavirus-related disruptions. Last week,however, Macy’s reported preliminary first quarter operating losses between $905 million and $1.1 billion compared with a $203 million operating profit a year earlier. Net sales are estimated between $3 billion and $3.03 billion compared with $5.5 billion in the first three months of 2019.“We closed all of our stores – Macy’s, Bloomingdale’s and Bluemercury – on March 18, which had a significant impact on our first-quarter results,” Chief Executive Jeff Gennette said in a statement. “Looking back, our performance in February was solid and in line with our expectations, but we saw a precipitous decline in sales with the stores closure in March.”Gennette said the retailer saw “a steady uptick” in its digital business in April, “which was encouraging, but only partially offset the loss of sales from online sales.”Macy’s has reopened 190 Macy’s and Bloomingdale’s stores in recent weeks. Macy’s shares at last check rose 4.8% to $5.46.
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