Deception Delays Macy’s Earnings Report

Macy’s Inc. (New York) has delayed releasing its final third-quarter earnings report after finding a now-departed employee had hidden up to $154 million in delivery expenses. Here’s how Macy’s described the situation in a news release that also included preliminary results for the retailer’s quarter:

“A single employee with responsibility for small-package delivery expense accounting intentionally made erroneous accounting accrual entries to hide approximately $132 [million] to $154 million of cumulative delivery expenses from the fourth quarter of 2021 through fiscal quarter ended Nov. 2. During this same time period, the company recognized approximately $4.36 billion of delivery expenses.

“There is no indication that the erroneous accounting accrual entries had any impact on the company’s cash-management activities or vendor payments. The individual who engaged in this conduct is no longer employed by the company. The investigation has not identified involvement by any other employee.”

Added Chairman and CEO Tony Spring: “At Macy’s Inc., we promote a culture of ethical conduct. While we work diligently to complete the investigation as soon as practicable and ensure this matter is handled appropriately, our colleagues across the company are focused on serving our customers and executing our strategy for a successful holiday season.”

As for its preliminary results, the department store retailer said its third-quarter sales fell 2.4%, to $4.74 billion. Macy’s did not post earnings figures for the quarter, but said it expects to release its full results, along with fourth-quarter and full-year guidance, by Dec. 11.