(Reuters) -Macy’s on Monday delayed the publication of its third-quarter results due to an accounting issue tied to delivery expenses and instead posted preliminary results in which its sales missed Wall Street expectations.
A single employee “intentionally made erroneous accounting accrual entries” to hide about $132 million to $154 million of cumulative delivery expenses from the fourth quarter of 2021 through third quarter of 2024, the department store chain said.
Macy’s had recorded about $4.36 billion as delivery expenses in this period.
The company, which was set to report results on Nov.26, said the employee is no longer with the company and that an independent investigation has showed no involvement by any other employee.
It said there was no indication that the accounting error had any impact on the cash management activities or vendor payments. Shares of the company were down 4.4% in premarket trading.
Macy’s expects to report its full third-quarter financial results and hold its earnings conference call, in which it will provide its fourth quarter and annual outlooks, by Dec. 11.
“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,” Macy’s CEO Tony Spring said.
In the preliminary results, net sales fell 2.4% to $4.74 billion compared to analysts’ average estimate of $4.77 billion, as steep promotions failed to attract customers who have turned selective on purchases for the holidays.
(Reporting by Ananya Mariam Rajesh in Bengaluru; Editing by Arun Koyyur)
