Macy’s Inc posted quarterly sales that were lower than had been expected as a strong U.S. dollar substantially reduced the spending by foreign visitors in the U.S. and the business discounted to move merchandise delayed because of strikes at ports up and down the West Coast.
The company said that it formed a new joint venture with a company based in Hong Kong to explore retailing online in China.
Macy’s, which operates namesake stores as well as Bloomingdale’s its upscale store, saw its shares move up 1% in Wednesday premarket trading.
The company will own a stake of 65% in the new joint venture known as Macy’s China Ltd, with partner Fung Retailing Ltd.
The retailer said it expected it would have sales of $50 million in 2016 from China.
Macy’s also announced that it would sell a portion of its retail store Fulton Street in Brooklyn to Tishman Speyer a real estate company for over $170 million.
Macy’s will have an additional $100 million over the next three years as well as continue to operate four floors of the store that is nine stories.
Macy’s has been under heavy pressure from Starboard Value an activist investor to consider the spinoff of its portfolio of real estate.
It announced that it hired advisers to study its portfolio and determine where its opportunities exist.
Sales at same store for Macy’s, including licensed departments dropped 1.5% during its second quarter. Analysts were expecting a rise of 1.3%.
Macy’s forecast sales of same stores to be flat for the full year ending January of 2016 and a drop of 1% in overall sales.
Net income was down 26% to just over $217 million equal to 64 cents a share, during the quarter that ended on August 1.
Net sales dropped 2.6% to just over $6.1 billion, which was the fourth decline in the past six quarters.
