May Department Stores plans 200 new shops by 2006

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Posted 7:36AM on Tuesday, April 9, 2002

ST. LOUIS - May Department Stores Co. plans to open more than 200 new stores by the end of 2006, pouring billions of dollars into expansion as the St. Louis-based retailer and its counterparts bid to counter the popularity of discounters. May, which operates such stores as Lord & Taylor, Famous-Barr and The Jones Store, said in a Securities and Exchange Commission filing Friday it looks to open 62 new department stores and at least 150 bridal group stores over the next five years. May said its $4.1 billion capital plan through the five-year period includes a $1.6 billion investment in new stores, $1.2 billion to expand and remodel existing stores and $370 million for systems and operations upgrades. This year, May plans to open 11 new department stores, one-half the number of new stores it christened last year. The new sites will be in California, Florida, Kansas, Massachusetts, Missouri, North Carolina, Ohio and Texas. May also plans to remodel 31 department stores this year, eight more than in 2001. At the end of the fiscal year that ended Feb. 2, May had 439 department stores in 37 states and the District of Columbia, as well as 400 bridal group stores that include David's Bridal, After Hours Formalwear and Priscilla of Boston. Last fiscal year, May earned $703 million, or $2.21 a share, compared with $858 million, or $2.62, the previous year. Sales for the year were $14.22 billion, down 1 percent from $14.37 billion a year earlier when the period included an extra week. Despite reports of an improved economy, retailers - notably department stores and mall-based apparel retailers - have been pummeled by consumers' continued shift toward discounters. To woo shoppers, department stores have slashed prices but still have recorded sales declines. Merger talks between Federated Department Stores - operator of such department stores as Bloomingdale's and Macy's - and May have cooled off, but both are scrutinizing the profitability of their stores. Federated announced last month it will explore the sale of Fingerhut's assets immediately and lay off 3,300 workers. May has about 127,000 workers in 44 states, the District of Columbia, Puerto Rico and 10 offices overseas. May's shares closed at $35.30, up 33 cents, on the New York Stock Exchange.