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For the Fiscal Year Ended
January 28, 2017
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Commission File Number:
1-13536
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Incorporated in Delaware
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I.R.S. No. 13-3324058
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, par value $.01 per share
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New York Stock Exchange
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Large accelerated filer
ý
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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(Do not check if a smaller reporting company)
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Class
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Outstanding at February 24, 2017
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Common Stock, $0.01 par value per share
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304,258,647 shares
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Document
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Parts Into
Which Incorporated
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Proxy Statement for the Annual Meeting of Stockholders to be held May 19, 2017 (Proxy Statement)
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Part III
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•
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the possible invalidity of the underlying beliefs and assumptions;
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•
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competitive pressures from department and specialty stores, general merchandise stores, manufacturers’ outlets, off-price and discount stores, and all other retail channels, including the Internet, catalogs and television;
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•
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general consumer-spending levels, including the impact of general economic conditions, consumer disposable income levels, consumer confidence levels, the availability, cost and level of consumer debt, mall vacancy issues, the costs of basic necessities and other goods and the effects of the weather or natural disasters;
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•
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conditions to, or changes in the timing of, proposed transactions and changes in expected synergies, cost savings and non-recurring charges;
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•
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transactions involving the Company's real estate portfolio;
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•
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possible changes or developments in social, economic, business, industry, market, legal and regulatory circumstances and conditions;
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•
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possible actions taken or omitted to be taken by third parties, including customers, suppliers, business partners, competitors and legislative, regulatory, judicial and other governmental authorities and officials;
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•
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changes in relationships with vendors and other product and service providers;
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•
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currency, interest and exchange rates and other capital market, economic and geo-political conditions;
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•
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severe or unseasonable weather, possible outbreaks of epidemic or pandemic diseases and natural disasters;
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•
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unstable political conditions, civil unrest, terrorist activities and armed conflicts;
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•
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the possible inability of the Company’s manufacturers or transporters to deliver products in a timely manner or meet the Company’s quality standards;
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•
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the Company’s reliance on foreign sources of production, including risks related to the disruption of imports by labor disputes, regional health pandemics, and regional political and economic conditions;
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•
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duties, taxes, other charges and quotas on imports; and
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•
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possible systems failures and/or security breaches, including, any security breach that results in the theft, transfer or unauthorized disclosure of customer, employee or company information, or the failure to comply with various laws applicable to the Company in the event of such a breach.
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Item 1.
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Business.
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2016
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2015
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2014
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|||
Women’s Accessories, Intimate Apparel, Shoes, Cosmetics and Fragrances
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38
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%
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38
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%
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38
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%
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Women’s Apparel
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23
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23
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23
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Men’s and Children’s
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23
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23
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23
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Home/Miscellaneous
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16
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16
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16
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100
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%
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100
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%
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100
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%
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•
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The Company’s bank subsidiary, FDS Bank, provides credit processing, certain collections, customer service and credit marketing services in respect of all credit card accounts that are owned either by Department Stores National Bank (“DSNB”), a subsidiary of Citibank, N.A., or FDS Bank and that constitute a part of the credit programs of the Company’s retail operations.
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•
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Macy’s Systems and Technology, Inc. (“MST”), a wholly-owned indirect subsidiary of the Company, provides operational electronic data processing and management information services to all of the Company’s operations other than Bluemercury and Macy's China Limited.
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•
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Macy’s Merchandising Group, Inc. (“MMG”), a wholly-owned direct subsidiary of the Company, and its subsidiary Macy's Merchandising Group International, LLC, are responsible for the design, development and marketing of Macy’s private label brands and certain licensed brands. Bloomingdale’s uses MMG for a small portion of its private label merchandise. The Company believes that its private label merchandise differentiates its merchandise assortments from those of its competitors and delivers exceptional value to its customers. MMG also offers its services, either directly or indirectly, to unrelated third parties.
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•
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Macy’s Logistics and Operations (“Macy’s Logistics”), a division of a wholly-owned indirect subsidiary of the Company, provides warehousing and merchandise distribution services for the Company’s operations and digital customer fulfillment.
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•
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Audit Committee Charter,
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•
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Compensation and Management Development Committee Charter,
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•
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Finance Committee Charter,
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•
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Nominating and Corporate Governance Committee Charter,
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•
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Corporate Governance Principles,
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•
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Lead Independent Director Policy,
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•
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Non-Employee Director Code of Business Conduct and Ethics, and
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•
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Code of Conduct.
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Name
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Age
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Position with the Company
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Terry J. Lundgren
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65
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Executive Chairman and Chairman of the Board; Director
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Jeff Gennette
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55
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President, Chief Executive Officer; Director
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Timothy Baxter
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47
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Chief Merchandising Officer
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Elisa D. Garcia
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59
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Chief Legal Officer and Secretary
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Robert B. Harrison
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53
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Chief Omnichannel and Operations Officer
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Karen M. Hoguet
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60
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Chief Financial Officer
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Jeffrey A. Kantor
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58
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Chief Stores and Human Resources Officer
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Molly Langenstein
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53
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Chief Private Brands Officer
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Richard A. Lennox
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51
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Chief Marketing Officer
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Justin S. MacFarlane
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44
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Chief Strategy, Analytics and Innovation Officer
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Patti H. Ongman
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61
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Chief Merchandise Planning Officer
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Tony Spring
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52
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Chairman and Chief Executive Officer, Bloomingdale's
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Felicia Williams
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51
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Executive Vice President, Controller and Enterprise Risk
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Item 1A.
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Risk Factors.
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•
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materially damage the Company's reputation and brand, negatively affect customer satisfaction and loyalty, expose the Company to individual claims or consumer class actions, administrative, civil or criminal investigations or actions, and infringe on proprietary information; and
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•
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cause the Company to incur substantial costs, including but not limited to, costs associated with remediation of information technology systems, customer protection costs and incentive payments for the maintenance of business relationships, litigation costs, lost revenues resulting from negative changes in consumer shopping patterns, unauthorized use of proprietary information or the failure to retain or attract customers following an attack. While the Company maintains insurance coverage that may, subject to policy terms and conditions, cover certain aspects of cyber risks, such insurance coverage may be unavailable or insufficient to cover all losses or all types of claims that may arise in the continually evolving area of cyber risk.
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•
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general economic, stock, credit and real estate market conditions;
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•
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risks relating to the Company’s business and its industry, including those discussed above;
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•
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strategic actions by the Company or its competitors;
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•
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variations in the Company’s quarterly results of operations;
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•
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future sales or purchases of the Company’s common stock; and
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•
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investor perceptions of the investment opportunity associated with the Company’s common stock relative to other investment alternatives.
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Item 1B.
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Unresolved Staff Comments.
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Item 2.
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Properties.
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2016
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2015
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2014
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|||
Macy's
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673
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737
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773
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Bloomingdale's
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55
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54
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50
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Bluemercury
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101
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77
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—
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829
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868
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823
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Geographic Region
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Total
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Owned
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Leased
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Subject to
a Ground
Lease
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Partly Owned and Partly
Leased
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|||||
North Central
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142
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84
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38
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20
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—
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Northeast
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250
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90
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132
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28
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—
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Northwest
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131
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44
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62
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22
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3
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South
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179
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116
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42
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21
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—
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Southwest
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127
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48
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56
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22
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1
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829
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382
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330
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113
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4
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Location
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Primary Function
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Owned or Leased
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Square Footage (thousands)
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Cheshire, CT
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Direct to customer
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Owned
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565
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Chicago, IL
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Stores
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Owned
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861
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Denver, CO
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Stores
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Leased
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20
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Goodyear, AZ
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Direct to customer
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Owned
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960
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Hayward, CA
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Stores
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Owned
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386
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Houston, TX
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Stores
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Owned
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1,124
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Joppa, MD
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Stores
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Owned
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850
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Kapolei, HI
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Stores
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Owned
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260
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Los Angeles, CA
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Stores
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Owned
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1,178
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Martinsburg, WV
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Direct to customer
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Owned
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1,300
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Miami, FL
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Stores
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Leased
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535
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Portland, TN
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Direct to customer
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Owned
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950
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Raritan, NJ
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Stores
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Owned
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980
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Sacramento, CA
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Direct to customer
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Leased
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385
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Secaucus, NJ
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Stores
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Leased
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675
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South Windsor, CT
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Stores
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Owned
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510
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Stone Mountain, GA
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Stores
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Owned
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1,000
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Tampa, FL
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Stores
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Owned
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670
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Tulsa, OK
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Direct to customer
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Owned
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1,300
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Tukwila, WA
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Stores
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Leased
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500
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Union City, CA
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Stores
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Leased
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165
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Youngstown, OH
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Stores
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Owned
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851
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Item 3.
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Legal Proceedings.
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Item 5.
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Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
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2016
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2015
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||||||||||||||
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Low
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High
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Dividend
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Low
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High
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Dividend
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||||||
1st Quarter
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37.71
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45.50
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0.3600
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61.10
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69.98
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0.3125
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2nd Quarter
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29.94
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40.15
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|
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0.3775
|
|
|
62.80
|
|
|
73.61
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|
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0.3600
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3rd Quarter
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31.02
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|
|
40.98
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|
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0.3775
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|
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47.10
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|
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70.12
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|
|
0.3600
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4th Quarter
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28.55
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|
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45.41
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|
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0.3775
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|
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34.05
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|
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52.48
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|
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0.3600
|
|
|
Total
Number
of Shares
Purchased
|
|
Average
Price per
Share ($)
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|
Number of Shares
Purchased under
Program (1)
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|
Open
Authorization
Remaining ($)(1)
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||||
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(thousands)
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(thousands)
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(millions)
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||||
October 30, 2016 – November 26, 2016
|
727
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|
|
42.90
|
|
|
727
|
|
|
1,763
|
|
November 27, 2016 – December 31, 2016
|
1,152
|
|
|
40.61
|
|
|
1,152
|
|
|
1,716
|
|
January 1, 2017 – January 28, 2017
|
—
|
|
|
—
|
|
|
—
|
|
|
1,716
|
|
|
1,879
|
|
|
41.49
|
|
|
1,879
|
|
|
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(1)
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Commencing in January 2000, the Company’s Board of Directors has from time to time approved authorizations to purchase, in the aggregate, up to
$18 billion
of Common Stock. All authorizations are cumulative and do not have an expiration date. As of
January 28, 2017
,
$1,716 million
of authorization remained unused. The Company may continue, discontinue or resume purchases of Common Stock under these or possible future authorizations in the open market, in privately negotiated transactions or otherwise at any time and from time to time without prior notice.
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Item 6.
|
Selected Financial Data.
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012*
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||||||||||
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(millions, except per share)
|
||||||||||||||||||
Consolidated Statement of Income Data:
|
|
|
|
|
|
|
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||||||||||
Net sales
|
$
|
25,778
|
|
|
$
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27,079
|
|
|
$
|
28,105
|
|
|
$
|
27,931
|
|
|
$
|
27,686
|
|
Cost of sales
|
(15,621
|
)
|
|
(16,496
|
)
|
|
(16,863
|
)
|
|
(16,725
|
)
|
|
(16,538
|
)
|
|||||
Gross margin
|
10,157
|
|
|
10,583
|
|
|
11,242
|
|
|
11,206
|
|
|
11,148
|
|
|||||
Selling, general and administrative expenses
|
(8,265
|
)
|
|
(8,256
|
)
|
|
(8,355
|
)
|
|
(8,440
|
)
|
|
(8,482
|
)
|
|||||
Impairments, store closing and other costs
|
(479
|
)
|
|
(288
|
)
|
|
(87
|
)
|
|
(88
|
)
|
|
(5
|
)
|
|||||
Settlement charges
|
(98
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating income
|
1,315
|
|
|
2,039
|
|
|
2,800
|
|
|
2,678
|
|
|
2,661
|
|
|||||
Interest expense
|
(367
|
)
|
|
(363
|
)
|
|
(395
|
)
|
|
(390
|
)
|
|
(425
|
)
|
|||||
Premium on early retirement of debt
|
—
|
|
|
—
|
|
|
(17
|
)
|
|
—
|
|
|
(137
|
)
|
|||||
Interest income
|
4
|
|
|
2
|
|
|
2
|
|
|
2
|
|
|
3
|
|
|||||
Income before income taxes
|
952
|
|
|
1,678
|
|
|
2,390
|
|
|
2,290
|
|
|
2,102
|
|
|||||
Federal, state and local income tax expense
|
(341
|
)
|
|
(608
|
)
|
|
(864
|
)
|
|
(804
|
)
|
|
(767
|
)
|
|||||
Net income
|
611
|
|
|
1,070
|
|
|
1,526
|
|
|
1,486
|
|
|
1,335
|
|
|||||
Net loss attributable to noncontrolling interest
|
8
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income attributable to Macy's, Inc. shareholders
|
$
|
619
|
|
|
$
|
1,072
|
|
|
$
|
1,526
|
|
|
$
|
1,486
|
|
|
$
|
1,335
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic earnings per share attributable to
Macy's, Inc. shareholders |
$
|
2.01
|
|
|
$
|
3.26
|
|
|
$
|
4.30
|
|
|
$
|
3.93
|
|
|
$
|
3.29
|
|
Diluted earnings per share attributable to
Macy's, Inc. shareholders |
$
|
1.99
|
|
|
$
|
3.22
|
|
|
$
|
4.22
|
|
|
$
|
3.86
|
|
|
$
|
3.24
|
|
Average number of shares outstanding
|
308.5
|
|
|
328.4
|
|
|
355.2
|
|
|
378.3
|
|
|
405.5
|
|
|||||
Cash dividends paid per share
|
$
|
1.4925
|
|
|
$
|
1.3925
|
|
|
$
|
1.1875
|
|
|
$
|
.9500
|
|
|
$
|
.8000
|
|
Depreciation and amortization
|
$
|
1,058
|
|
|
$
|
1,061
|
|
|
$
|
1,036
|
|
|
$
|
1,020
|
|
|
$
|
1,049
|
|
Capital expenditures
|
$
|
912
|
|
|
$
|
1,113
|
|
|
$
|
1,068
|
|
|
$
|
863
|
|
|
$
|
942
|
|
Balance Sheet Data (at year end):
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
1,297
|
|
|
$
|
1,109
|
|
|
$
|
2,246
|
|
|
$
|
2,273
|
|
|
$
|
1,836
|
|
Total assets
|
19,851
|
|
|
20,576
|
|
|
21,330
|
|
|
21,499
|
|
|
20,858
|
|
|||||
Short-term debt
|
309
|
|
|
642
|
|
|
76
|
|
|
463
|
|
|
124
|
|
|||||
Long-term debt
|
6,562
|
|
|
6,995
|
|
|
7,233
|
|
|
6,688
|
|
|
6,768
|
|
|||||
Total Shareholders’ equity
|
4,322
|
|
|
4,253
|
|
|
5,378
|
|
|
6,249
|
|
|
6,051
|
|
*
|
53 weeks
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
•
|
Transforming the omnichannel business and focusing on key growth areas,
|
•
|
Embracing customer centricity, including a simplified value proposition, and
|
•
|
Optimizing value in the real estate portfolio.
|
•
|
In January 2016, the Company completed a $270 million real estate transaction to recreate Macy's Brooklyn store. The Company continues to own and operate the first four floors and lower level of its existing nine-story retail store, which is currently being reconfigured and remodeled. The remaining portion of the store and its nearby parking facility were sold to Tishman Speyer in a single sales transaction. As the sales agreement required the Company to conduct certain redevelopment activities at Macy's Brooklyn store, the Company is recognizing the gain on the transaction, approximately $250 million, under the percentage of completion method of accounting over the redevelopment period. Accordingly, $117 million has been recognized to-date and the remaining gain is anticipated to be recognized over the next two years.
|
•
|
In 2016, the Company had property and equipment sales, primarily related to real estate, totaling $673 million in cash proceeds and recognized real estate gains of $209 million. This includes the sale of its 248,000 square-foot Union Square Men’s building in San Francisco for approximately $250 million in January 2017. The Company will use part of the proceeds to consolidate the Men’s store into its main Union Square store. The Company will lease the Men’s store property for two to three years as it completes the reconfiguration of the main store. The Company is expected to recognize a gain of approximately $235 million in January 2018.
|
•
|
In January 2017, the Company finalized the formation of a strategic alliance with Brookfield Asset Management, a leading global alternative asset manager, to create increased value in its real estate portfolio. Under the alliance, Brookfield has an exclusive right for up to 24 months to create a “pre-development plan” for each of approximately 50 Macy’s real estate assets, with an option for Macy’s to continue to identify and add assets into the alliance. The breadth of opportunity within the portfolio ranges from the additional development on a portion of an asset (such as a Company-controlled land parcel adjacent to a store) to the complete redevelopment of an existing store. Once a "pre-development plan" is created, the Company has the option to contribute the asset into a joint venture for the development plan to commence or sell the asset to Brookfield. If the Company chooses to contribute the asset into a joint venture, the Company may elect to participate as a funding or non-funding partner. After development, the joint venture may sell the asset and distribute proceeds accordingly.
|
•
|
On February 28, 2017, the Company sold its downtown Minneapolis store and parking facility for $59 million of proceeds and a gain of approximately $47 million that is expected to be recognized in the first quarter of 2017. The downtown Minneapolis store will close in early 2017.
|
•
|
Comparable sales on an owned basis decreased
3.5%
and comparable sales on an owned plus licensed basis decreased
2.9%
.
|
•
|
Operating income for 2016 was
$1.892 billion
or
7.3%
of sales, excluding impairments, store closing and other costs and settlement charges, a
decrease
of
18.7%
and
130
basis points as a percent of sales from 2015 on a comparable basis.
|
•
|
Diluted earnings per share attributable to Macy's, Inc. shareholders, excluding certain items,
declined
17.5%
to
$3.11
in 2016 from
$3.77
in 2015.
|
•
|
Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization, impairments, store closing and other costs and settlement charges) as a percent to net sales was
11.4%
in 2016, as compared to
12.5%
in 2015.
|
•
|
Return on invested capital ("ROIC"), a key measure of operating productivity, was
18.5%
, a decrease from
20.1%
in 2015.
|
•
|
Net cash provided by operating activities, net of cash used by investing activities increased significantly in 2016 as compared to 2015.
|
•
|
The Company repurchased
7.9 million
shares of its common stock for
$316 million
in 2016, and increased its annualized dividend rate to $1.51 per share. This annualized dividend rate represents an increase of 5% and is the sixth increase in the dividend in the past five years.
|
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
Increase (decrease) in comparable sales on an owned
basis (note 1)
|
|
(3.5)%
|
|
(3.0)%
|
|
0.7%
|
|
1.9%
|
|
3.7%
|
Impact of growth in comparable sales of departments licensed
to third parties (note 2) |
|
0.6%
|
|
0.5%
|
|
0.7%
|
|
0.9%
|
|
0.3%
|
Increase (decrease) in comparable sales on an owned plus licensed basis
|
|
(2.9)%
|
|
(2.5)%
|
|
1.4%
|
|
2.8%
|
|
4.0%
|
(1)
|
Represents the period-to-period percentage change in net sales from stores in operation throughout the year presented and the immediately preceding year and all online sales of macys.com and bloomingdales.com, adjusting for the 53rd week in 2012, excluding commissions from departments licensed to third parties. Stores undergoing remodeling, expansion or relocation remain in the comparable sales calculation unless the store is closed for a significant period of time. Definitions and calculations of comparable sales differ among companies in the retail industry.
|
(2)
|
Represents the impact of including the sales of departments licensed to third parties occurring in stores in operation throughout the year presented and the immediately preceding year and all online sales of macys.com and bloomingdales.com, adjusting for the 53rd week in 2012, in the calculation of comparable sales. The Company licenses third parties to operate certain departments in its stores and online and receives commissions from these third parties based on a percentage of their net sales. In its financial statements prepared in conformity with GAAP, the Company includes these commissions (rather than sales of the departments licensed to third parties) in its net sales. The Company does not, however, include any amounts in respect of licensed department sales (or any commissions earned on such sales) in its comparable sales in accordance with GAAP (i.e., on an owned basis). The amounts of commissions earned on sales of departments licensed to third parties are not material to its net sales for the periods presented.
|
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
|
|
(millions, except percentages)
|
||||||||||||||||||
Net sales
|
|
$
|
25,778
|
|
|
$
|
27,079
|
|
|
$
|
28,105
|
|
|
$
|
27,931
|
|
|
$
|
27,686
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income
|
|
$
|
1,315
|
|
|
$
|
2,039
|
|
|
$
|
2,800
|
|
|
$
|
2,678
|
|
|
$
|
2,661
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income as a percent to net sales
|
|
5.1
|
%
|
|
7.5
|
%
|
|
10.0
|
%
|
|
9.6
|
%
|
|
9.6
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income
|
|
$
|
1,315
|
|
|
$
|
2,039
|
|
|
$
|
2,800
|
|
|
$
|
2,678
|
|
|
$
|
2,661
|
|
Add back impairments, store closing and
other costs |
|
479
|
|
|
288
|
|
|
87
|
|
|
88
|
|
|
5
|
|
|||||
Add back settlement charges
|
|
98
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating income, excluding certain items
|
|
$
|
1,892
|
|
|
$
|
2,327
|
|
|
$
|
2,887
|
|
|
$
|
2,766
|
|
|
$
|
2,666
|
|
Operating income, excluding certain items, as a
percent to net sales |
|
7.3
|
%
|
|
8.6
|
%
|
|
10.3
|
%
|
|
9.9
|
%
|
|
9.6
|
%
|
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
Diluted earnings per share attributable to
Macy's, Inc. shareholders |
|
$
|
1.99
|
|
|
$
|
3.22
|
|
|
$
|
4.22
|
|
|
$
|
3.86
|
|
|
$
|
3.24
|
|
Add back the pre-tax impact of impairments, store closing and other costs
|
|
1.54
|
|
|
0.86
|
|
|
0.24
|
|
|
0.23
|
|
|
0.01
|
|
|||||
Add back the pre-tax impact of settlement charges
|
|
0.31
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Add back the pre-tax impact of premium on early
retirement of debt |
|
—
|
|
|
—
|
|
|
0.05
|
|
|
—
|
|
|
0.33
|
|
|||||
Deduct the income tax impact of impairments, store closing and other costs, settlement charges and premium on early retirement of debt
|
|
(0.73
|
)
|
|
(0.31
|
)
|
|
(0.11
|
)
|
|
(0.09
|
)
|
|
(0.12
|
)
|
|||||
Diluted earnings per share attributable to
Macy's, Inc. shareholders, excluding the impact of impairments, store closing and other costs, settlement charges and premium on early retirement of debt |
|
$
|
3.11
|
|
|
$
|
3.77
|
|
|
$
|
4.40
|
|
|
$
|
4.00
|
|
|
$
|
3.46
|
|
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
|
|
(millions, except percentages)
|
||||||||||||||||||
Net sales
|
|
$
|
25,778
|
|
|
$
|
27,079
|
|
|
$
|
28,105
|
|
|
$
|
27,931
|
|
|
$
|
27,686
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
|
$
|
611
|
|
|
$
|
1,070
|
|
|
$
|
1,526
|
|
|
$
|
1,486
|
|
|
$
|
1,335
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income as a percent to net sales
|
|
2.4
|
%
|
|
4.0
|
%
|
|
5.4
|
%
|
|
5.3
|
%
|
|
4.8
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
|
$
|
611
|
|
|
$
|
1,070
|
|
|
$
|
1,526
|
|
|
$
|
1,486
|
|
|
$
|
1,335
|
|
Add back impairments, store
closing and other costs |
|
479
|
|
|
288
|
|
|
87
|
|
|
88
|
|
|
5
|
|
|||||
Add back settlement charges
|
|
98
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Add back interest expense - net
|
|
363
|
|
|
361
|
|
|
393
|
|
|
388
|
|
|
422
|
|
|||||
Add back premium on early retirement
of debt |
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
137
|
|
|||||
Add back federal, state and local income
tax expense |
|
341
|
|
|
608
|
|
|
864
|
|
|
804
|
|
|
767
|
|
|||||
Add back depreciation and amortization
|
|
1,058
|
|
|
1,061
|
|
|
1,036
|
|
|
1,020
|
|
|
1,049
|
|
|||||
Adjusted EBITDA
|
|
$
|
2,950
|
|
|
$
|
3,388
|
|
|
$
|
3,923
|
|
|
$
|
3,786
|
|
|
$
|
3,715
|
|
Adjusted EBITDA as a percent to net sales
|
|
11.4
|
%
|
|
12.5
|
%
|
|
14.0
|
%
|
|
13.6
|
%
|
|
13.4
|
%
|
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
|
|
(millions, except percentages)
|
||||||||||||||||||
Operating income
|
|
$
|
1,315
|
|
|
$
|
2,039
|
|
|
$
|
2,800
|
|
|
$
|
2,678
|
|
|
$
|
2,661
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Property and equipment - net
|
|
$
|
7,317
|
|
|
$
|
7,708
|
|
|
$
|
7,865
|
|
|
$
|
8,063
|
|
|
$
|
8,308
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income as a percent to property and
equipment - net |
|
18.0
|
%
|
|
26.5
|
%
|
|
35.6
|
%
|
|
33.2
|
%
|
|
32.0
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income
|
|
$
|
1,315
|
|
|
$
|
2,039
|
|
|
$
|
2,800
|
|
|
$
|
2,678
|
|
|
$
|
2,661
|
|
Add back impairments, store closing and
other costs |
|
479
|
|
|
288
|
|
|
87
|
|
|
88
|
|
|
5
|
|
|||||
Add back settlement charges
|
|
98
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Add back depreciation and amortization
|
|
1,058
|
|
|
1,061
|
|
|
1,036
|
|
|
1,020
|
|
|
1,049
|
|
|||||
Add back rent expense, net
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Real estate
|
|
319
|
|
|
301
|
|
|
279
|
|
|
268
|
|
|
258
|
|
|||||
Personal property
|
|
11
|
|
|
12
|
|
|
12
|
|
|
11
|
|
|
11
|
|
|||||
Deferred rent amortization
|
|
9
|
|
|
8
|
|
|
7
|
|
|
8
|
|
|
7
|
|
|||||
Adjusted operating income
|
|
$
|
3,289
|
|
|
$
|
3,709
|
|
|
$
|
4,221
|
|
|
$
|
4,073
|
|
|
$
|
3,991
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Property and equipment - net
|
|
$
|
7,317
|
|
|
$
|
7,708
|
|
|
$
|
7,865
|
|
|
$
|
8,063
|
|
|
$
|
8,308
|
|
Add back accumulated depreciation and amortization
|
|
5,088
|
|
|
5,457
|
|
|
5,830
|
|
|
6,007
|
|
|
5,967
|
|
|||||
Add capitalized value of non-capitalized leases
|
|
2,712
|
|
|
2,568
|
|
|
2,384
|
|
|
2,296
|
|
|
2,208
|
|
|||||
Add (deduct) other selected assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Receivables
|
|
411
|
|
|
338
|
|
|
336
|
|
|
339
|
|
|
322
|
|
|||||
Merchandise inventories
|
|
6,012
|
|
|
6,226
|
|
|
6,155
|
|
|
6,065
|
|
|
5,754
|
|
|||||
Prepaid expenses and other current assets
|
|
456
|
|
|
453
|
|
|
443
|
|
|
398
|
|
|
390
|
|
|||||
Other assets
|
|
881
|
|
|
775
|
|
|
784
|
|
|
659
|
|
|
579
|
|
|||||
Merchandise accounts payable
|
|
(2,182
|
)
|
|
(2,366
|
)
|
|
(2,472
|
)
|
|
(2,520
|
)
|
|
(2,362
|
)
|
|||||
Accounts payable and accrued liabilities
|
|
(2,924
|
)
|
|
(2,677
|
)
|
|
(2,511
|
)
|
|
(2,328
|
)
|
|
(2,333
|
)
|
|||||
Total average invested capital
|
|
$
|
17,771
|
|
|
$
|
18,482
|
|
|
$
|
18,814
|
|
|
$
|
18,979
|
|
|
$
|
18,833
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
ROIC
|
|
18.5
|
%
|
|
20.1
|
%
|
|
22.4
|
%
|
|
21.5
|
%
|
|
21.2
|
%
|
•
|
Total sales decline of approximately 3.2% - 4.3% from 2016 levels. Total sales in 2017 reflect a 53rd week of sales, whereas comparable sales below are on a 52-week basis.
|
•
|
Comparable sales decrease on an owned basis of approximately 2.2% - 3.3%, with comparable sales on an owned plus licensed basis to decline approximately 2% - 3%.
|
•
|
Asset sale gains of approximately $415 million - $435 million, including an expected $235 million gain associated with the sale of the Company's Union Square Macy's store and $100 million of additional gain from the sale of the Brooklyn real estate.
|
•
|
Selling, general and administrative expense savings of approximately $550 million from the restructuring and store closures announced at the end of 2016, partially offset by increased growth spending of approximately $250 million (resulting in a net expense savings of approximately $300 million).
|
•
|
Credit income of approximately $740 million - $760 million.
|
•
|
Adjusted diluted earnings per share attributable to Macy's, Inc. shareholders of $3.37 to $3.62, excluding any charges associated with store closures, restructuring, or settlement charges associated with Company's defined benefit plans. Included in this guidance is the expected gain of approximately $235 million, or approximately $.47 per diluted share, associated with the sale of the Company's Union Square Macy's Men's store.
|
•
|
Capital expenditures of approximately $900 million.
|
•
|
Excess cash after capital expenditures, payment of the Company's dividends and the $300 million debt maturity in July 2017 is expected to be used to repurchase debt.
|
|
Obligations Due, by Period
|
||||||||||||||||||
Total
|
|
Less than
1 Year
|
|
1 – 3
Years
|
|
3 – 5
Years
|
|
More than
5 Years
|
|||||||||||
(millions)
|
|||||||||||||||||||
Short-term debt
|
$
|
308
|
|
|
$
|
308
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Long-term debt
|
6,459
|
|
|
—
|
|
|
48
|
|
|
1,092
|
|
|
5,319
|
|
|||||
Interest on debt
|
4,162
|
|
|
342
|
|
|
658
|
|
|
631
|
|
|
2,531
|
|
|||||
Capital lease obligations
|
52
|
|
|
3
|
|
|
6
|
|
|
6
|
|
|
37
|
|
|||||
Operating leases
|
3,683
|
|
|
321
|
|
|
587
|
|
|
486
|
|
|
2,289
|
|
|||||
Letters of credit
|
30
|
|
|
30
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other obligations
|
4,325
|
|
|
2,744
|
|
|
470
|
|
|
279
|
|
|
832
|
|
|||||
|
$
|
19,019
|
|
|
$
|
3,748
|
|
|
$
|
1,769
|
|
|
$
|
2,494
|
|
|
$
|
11,008
|
|
Item 7A.
|
Quantitative and Qualitative Disclosures About Market Risk.
|
Item 8.
|
Consolidated Financial Statements and Supplementary Data.
|
|
Page
|
Consolidated Statements of Comprehensive Income for the fiscal years ended
January 28, 2017, January 30, 2016 and January 31, 2015 |
|
Consolidated Statements of Changes in Shareholders’ Equity for the fiscal years ended
January 28, 2017, January 30, 2016 and January 31, 2015 |
|
Consolidated Statements of Cash Flows for the fiscal years ended
January 28, 2017, January 30, 2016 and January 31, 2015 |
|
Item 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
|
Item 9A.
|
Controls and Procedures.
|
Item 10.
|
Directors, Executive Officers and Corporate Governance.
|
Name
|
|
Age
|
|
Director Since
|
|
Principal Occupation
|
Francis S. Blake
|
|
67
|
|
2015
|
|
Former Chairman and Chief Executive Officer of The Home Depot, Inc.
|
John A. Bryant
|
|
51
|
|
2015
|
|
Chairman of the Board of Kellogg Company since July 2014 and President and Chief Executive Officer since January 2011.
|
Deirdre P. Connelly
|
|
56
|
|
2008
|
|
Former President, North American Pharmaceuticals of GlaxoSmithKline, a global pharmaceutical company.
|
Leslie D. Hale
|
|
44
|
|
2015
|
|
Chief Operating Officer since 2016, Chief Financial Officer since 2007 and Executive Vice President since 2013 of RLJ Lodging Trust, a publicly-traded lodging real estate investment trust.
|
William H. Lenehan
|
|
40
|
|
2016
|
|
President and Chief Executive Officer of Four Corners Property Trust, Inc., a real estate investment trust, since August 2015.
|
Sara Levinson
|
|
66
|
|
1997
|
|
Co-Founder and Director of Katapult, a digital entertainment company making products for today's creative generation, since April 2013.
|
Joyce M. Roché
|
|
70
|
|
2006
|
|
Former President and Chief Executive Officer of Girls Incorporated, a national non-profit research, education and advocacy organization.
|
Paul C. Varga
|
|
53
|
|
2012
|
|
Chairman of Brown-Forman Corporation, a spirits and wine company, since August 2007 and Chief Executive Officer since 2005.
|
Marna C. Whittington
|
|
69
|
|
1993
|
|
Former Chief Executive Officer of Allianz Global Investors Capital, a diversified global investment firm.
|
Annie Young-Scrivner
|
|
48
|
|
2014
|
|
Executive Vice President of Starbucks Corporation since September 2009, with responsibility for global loyalty and digital development since September 2015.
|
Item 11.
|
Executive Compensation.
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence.
|
Item 14.
|
Principal Accountant Fees and Services.
|
Item 15.
|
Exhibits and Financial Statement Schedules.
|
Exhibit
Number
|
|
Description
|
|
Document if Incorporated by Reference
|
3.1
|
|
Amended and Restated Certificate of Incorporation
|
|
Exhibit 3.1 to the Company's Current Report on Form 8-K filed on May 18, 2010
|
|
|
|
|
|
3.1.1
|
|
Certificate of Designations of Series A Junior Participating Preferred Stock
|
|
Exhibit 3.1.1 to the Company's Annual Report on
Form 10-K (File No. 1-13536) for the fiscal year ended January 28, 1995
|
|
|
|
|
|
3.1.2
|
|
Article Seventh of the Amended and Restated Certificate of Incorporation
|
|
Exhibit 3.1 to the Company's Current Report on Form 8-K filed on May 24, 2011
|
|
|
|
|
|
3.2
|
|
Amended and Restated By-Laws
|
|
Exhibit 3.1 to the Company's Current Report on Form 8-K filed on September 30, 2016
|
|
|
|
|
|
4.1
|
|
Amended and Restated Certificate of Incorporation
|
|
See Exhibits 3.1, 3.1.1 and 3.1.2
|
|
|
|
|
|
4.2
|
|
Amended and Restated By-Laws
|
|
See Exhibit 3.2
|
|
|
|
|
|
4.3
|
|
Indenture, dated as of January 15, 1991, among the Company (as successor to The May Department Stores Company (“May Delaware”)), Macy's Retail Holdings, Inc. (“Macy's Retail”) (f/k/a The May Department Stores Company (NY) or “May New York”) and The Bank of New York Mellon Trust Company, N.A. (“BNY Mellon”, successor to J.P. Morgan Trust Company and as successor to The First National Bank of Chicago), as Trustee (the “1991 Indenture”)
|
|
Exhibit 4(2) to May New York’s Current Report on Form 8-K filed on January 15, 1991
|
|
|
|
|
|
4.3.1
|
|
Guarantee of Securities, dated as of August 30, 2005, by the Company relating to the 1991 Indenture
|
|
Exhibit 10.13 to the Company's Current Report on
Form 8-K filed on August 30, 2005 (the “August 30, 2005 Form 8-K”)
|
|
|
|
|
|
4.4
|
|
Indenture, dated as of December 15, 1994, between the Company and U.S. Bank National Association (successor to State Street Bank and Trust Company and The First National Bank of Boston), as Trustee (the “1994 Indenture”)
|
|
Exhibit 4.1 to the Company's Registration Statement on Form S-3 (Registration No. 33-88328) filed on January 9, 1995
|
|
|
|
|
|
4.4.1
|
|
Eighth Supplemental Indenture to the 1994 Indenture, dated as of July 14, 1997, between the Company and U.S. Bank National Association (successor to State Street Bank and Trust Company and The First National Bank of Boston), as Trustee
|
|
Exhibit 2 to the Company's Current Report on Form 8-K filed on July 15, 1997 (the “July 15, 1997 Form 8-K”)
|
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Document if Incorporated by Reference
|
4.4.2
|
|
Ninth Supplemental Indenture to the 1994 Indenture, dated as of July 14, 1997, between the Company and U.S. Bank National Association (successor to State Street Bank and Trust Company and The First National Bank of Boston), as Trustee
|
|
Exhibit 3 to the July 15, 1997 Form 8-K
|
|
|
|
|
|
4.4.3
|
|
Tenth Supplemental Indenture to the 1994 Indenture, dated as of August 30, 2005, among the Company, Macy's Retail and U.S. Bank National Association (as successor to State Street Bank and Trust Company and as successor to The First National Bank of Boston), as Trustee
|
|
Exhibit 10.14 to the August 30, 2005 Form 8-K
|
|
|
|
|
|
4.4.4
|
|
Guarantee of Securities, dated as of August 30, 2005, by the Company relating to the 1994 Indenture
|
|
Exhibit 10.16 to the August 30, 2005 Form 8-K
|
|
|
|
|
|
4.5
|
|
Indenture, dated as of September 10, 1997, between the Company and U.S. Bank National Association (successor to Citibank, N.A.), as Trustee (the “1997 Indenture”)
|
|
Exhibit 4.4 to the Company's Amendment No. 1 to Form S-3 (Registration No. 333-34321) filed on September 11, 1997
|
|
|
|
|
|
4.5.1
|
|
First Supplemental Indenture to the 1997 Indenture, dated as of February 6, 1998, between the Company and U.S. Bank National Association (successor to Citibank, N.A.), as Trustee
|
|
Exhibit 2 to the Company's Current Report on Form 8-K filed on February 6, 1998
|
|
|
|
|
|
4.5.2
|
|
Third Supplemental Indenture to the 1997 Indenture, dated as of March 24, 1999, between the Company and U.S. Bank National Association (successor to Citibank, N.A.), as Trustee
|
|
Exhibit 4.2 to the Company's Registration Statement on Form S-4 (Registration No. 333-76795) filed on April 22, 1999
|
|
|
|
|
|
4.5.3
|
|
Seventh Supplemental Indenture to the 1997 Indenture, dated as of August 30, 2005 among the Company, Macy's Retail and U.S. Bank National Association (successor to Citibank, N.A.), as Trustee
|
|
Exhibit 10.15 to the August 30, 2005 Form 8-K
|
|
|
|
|
|
4.5.4
|
|
Guarantee of Securities, dated as of August 30, 2005, by the Company relating to the 1997 Indenture
|
|
Exhibit 10.17 to the August 30, 2005 Form 8-K
|
|
|
|
|
|
4.6
|
|
Indenture, dated as of June 17, 1996, among the Company (as successor to May Delaware), Macy's Retail (f/k/a May New York) and The Bank of New York Mellon Trust Company, N.A. (“BNY Mellon”, successor to J.P. Morgan Trust Company), as Trustee (the “1996 Indenture”)
|
|
Exhibit 4.1 to the Registration Statement on Form S-3 (Registration No. 333-06171) filed on June 18, 1996 by May Delaware
|
|
|
|
|
|
4.6.1
|
|
First Supplemental Indenture to the 1996 Indenture, dated as of August 30, 2005, by and among the Company (as successor to May Delaware), Macy's Retail (f/k/a May New York) and BNY Mellon, as Trustee
|
|
Exhibit 10.9 to the August 30, 2005 Form 8-K
|
|
|
|
|
|
4.7
|
|
Indenture, dated as of July 20, 2004, among the Company (as successor to May Delaware), Macy's Retail (f/k/a May New York) and BNY Mellon, as Trustee (the “2004 Indenture”)
|
|
Exhibit 4.1 to the Current Report on Form 8-K (File No. 001-00079) filed on July 21, 2004 by May Delaware
|
|
|
|
|
|
4.7.1
|
|
First Supplemental Indenture to the 2004 Indenture, dated as of August 30, 2005 among the Company (as successor to May Delaware), Macy's Retail and BNY Mellon, as Trustee
|
|
Exhibit 10.10 to the August 30, 2005 Form 8-K
|
|
|
|
|
|
4.8
|
|
Indenture, dated as of November 2, 2006, by and among Macy's Retail, the Company and U.S. Bank National Association, as Trustee (the “2006 Indenture”)
|
|
Exhibit 4.6 to the Company's Registration Statement on Form S-3ASR (Registration No. 333-138376) filed on November 2, 2006
|
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Document if Incorporated by Reference
|
4.8.1
|
|
First Supplemental Indenture to the 2006 Indenture, dated November 29, 2006, among Macy's Retail, the Company and U.S. Bank National Association, as Trustee
|
|
Exhibit 4.1 to the Company's Current Report on Form 8-K filed on November 29, 2006
|
|
|
|
|
|
4.8.2
|
|
Third Supplemental Indenture to the 2006 Indenture, dated March 12, 2007, among Macy's Retail, the Company and U.S. Bank National Association, as Trustee
|
|
Exhibit 4.2 to the Company's Current Report on Form 8-K filed on March 12, 2007
|
|
|
|
|
|
4.8.3
|
|
Sixth Supplemental Indenture to the 2006 Indenture, dated December 10, 2015, among Macy's Retail, the Company and U.S. Bank National Association, as Trustee
|
|
Exhibit 4.2 to the Company's Current Report on Form 8-K filed on December 10, 2015
|
|
|
|
|
|
4.9
|
|
Indenture, dated as of January 13, 2012, among Macy's Retail, the Company and BNY Mellon, as Trustee (the "2012 Indenture")
|
|
Exhibit 4.1 to the Company's Current Report on Form 8-K filed on January 13, 2012 (the “January 13, 2012 Form 8-K”)
|
|
|
|
|
|
4.9.1
|
|
First Supplemental Trust Indenture to the 2012 Indenture, dated as of January 13, 2012, among Macy's Retail, as issuer, the Company, as guarantor, and BNY Mellon, as trustee
|
|
Exhibit 4.2 to the January 13, 2012 Form 8-K
|
|
|
|
|
|
4.9.2
|
|
Second Supplemental Trust Indenture to the 2012 Indenture, dated as of January 13, 2012, among Macy's Retail, as issuer, the Company, as guarantor, and BNY Mellon, as trustee
|
|
Exhibit 4.3 to the January 13, 2012 Form 8-K
|
|
|
|
|
|
4.9.3
|
|
Third Supplemental Trust Indenture, dated as of November 20, 2012, among Macy's Retail, as issuer, the Company, as guarantor, and BNY Mellon, as trustee
|
|
Exhibit 4.2 to the Company's Current Report on Form 8-K filed on November 20, 2012 (the “November 20, 2012 Form 8-K”)
|
|
|
|
|
|
4.9.4
|
|
Fourth Supplemental Trust Indenture, dated as of November 20, 2012, among Macy's Retail, as issuer, the Company, as guarantor, and BNY Mellon, as trustee
|
|
Exhibit 4.3 to the November 20, 2012 Form 8-K
|
|
|
|
|
|
4.9.5
|
|
Fifth Supplemental Trust Indenture, dated as of September 6, 2013, among Macy's Retail, as issuer, the Company, as guarantor, and BNY Mellon, as trustee
|
|
Exhibit 4.2 to the Company's Current Report on Form 8-K filed on September 6, 2013
|
|
|
|
|
|
4.9.6
|
|
Sixth Supplemental Trust Indenture, dated as of May 23, 2014, among Macy's Retail, as issuer, the Company, as guarantor, and BNY Mellon, as trustee
|
|
Exhibit 4.2 to the Company's Current Report on Form 8-K filed on May 23, 2014
|
|
|
|
|
|
4.9.7
|
|
Seventh Supplemental Trust Indenture, dated as of November 18, 2014, among Macy's Retail, as issuer, the Company, as guarantor, and BNY Mellon, as trustee
|
|
Exhibit 4.2 to the Company's Current Report on Form 8-K filed on November 18, 2014
|
|
|
|
|
|
10.1
|
|
Credit Agreement, dated as of May 6, 2016, among the Company, Macy's Retail, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent and paying agent, and Bank of America, N.A., as administrative agent
|
|
Exhibit 10.01 to the Company's Current Report on Form 8-K filed on May 11, 2016 (the “May 11, 2016 Form 8-K”)
|
|
|
|
|
|
10.2
|
|
Guarantee Agreement, dated as of May 16, 2016, among the Company, Macy's Retail, certain subsidiary guarantors and JPMorgan Chase Bank, N.A., as paying agent
|
|
Exhibit 10.02 to the May 11, 2016 Form 8-K
|
|
|
|
|
|
10.3
|
|
Tax Sharing Agreement, dated as of October 31, 2014, among Macy's, Inc. and members of the Affiliated Group
|
|
Exhibit 10.7 to the Company's Annual Report on Form 10-K (File No. 1-13536) for the fiscal year ended January 31, 2015 (the “2014 Form 10-K”)
|
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Document if Incorporated by Reference
|
10.4+
|
|
Amended and Restated Credit Card Program Agreement, dated November 10, 2014, among the Company, FDS Bank, Macy's Credit and Customer Services, Inc. (“MCCS”), Macy's West Stores, Inc., Bloomingdales, Inc., Department Stores National Bank ("DSNB") and Citibank, N.A.
|
|
Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q filed on December 8, 2014
|
|
|
|
|
|
10.5
|
|
1995 Executive Equity Incentive Plan, as amended and restated as of June 1, 2007 (the “1995 Plan”) *
|
|
Exhibit 10.11 to the Company's Annual Report on Form 10-K (File No. 1-13536) for the fiscal year ended January 31, 2009 (the “2008 Form 10-K”)
|
|
|
|
|
|
10.6
|
|
Senior Executive Incentive Compensation Plan *
|
|
Appendix B to the Company's Proxy Statement dated March 28, 2012
|
|
|
|
|
|
10.7
|
|
1994 Stock Incentive Plan, as amended and restated as of June 1, 2007 *
|
|
Exhibit 10.13 to the 2008 Form 10-K
|
|
|
|
|
|
10.8
|
|
Form of Indemnification Agreement *
|
|
Exhibit 10.14 to the Registration Statement on Form 10 (File No. 1-10951), filed on November 27, 1991
|
|
|
|
|
|
10.9
|
|
Executive Severance Plan, effective November 1, 2009, as revised and restated January 1, 2014 *
|
|
Exhibit 10.14 to the Company’s Annual Report on Form 10-K (File No. 1-13536) for the fiscal year ended February 1, 2014 (the “2013 Form 10-K”)
|
|
|
|
|
|
10.10
|
|
Form of Non-Qualified Stock Option Agreement for the 1995 Plan (for Executives and Key Employees) *
|
|
Exhibit 10.2 to the Company's Current Report on Form 8-K filed on March 29, 2005
|
|
|
|
|
|
10.10.1
|
|
Form of Non-Qualified Stock Option Agreement for the 1995 Plan (for Executives and Key Employees), as amended *
|
|
Exhibit 10.33.1 to the Company's Annual Report Form 10-K (File No. 1-13536) for the fiscal year ended January 28, 2006
|
|
|
|
|
|
10.10.2
|
|
Form of Non-Qualified Stock Option Agreement for the 1994 Stock Incentive Plan *
|
|
Exhibit 10.7 to the Current Report on From 8-K (File No. 001-00079) filed on March 23, 2005 by May Delaware (the “March 23, 2005 Form 8-K”)
|
|
|
|
|
|
10.10.3
|
|
Form of Nonqualified Stock Option Agreement under the 2009 Omnibus Incentive Compensation Plan (for Executives and Key Employees) *
|
|
Exhibit 10.15.3 to the Company's Annual Report on Form 10-K (File No. 1-13536) for the fiscal year ended February 2, 2013 (the "2012 Form 10-K")
|
|
|
|
|
|
10.10.4
|
|
Form of Nonqualified Stock Option Agreement under the Amended and Restated 2009 Omnibus Incentive Compensation Plan (for Executives and Key Employees) *
|
|
Exhibit 10.14.4 to the 2014 Form 10-K
|
|
|
|
|
|
10.11
|
|
Nonqualified Stock Option Agreement, dated as of October 26, 2007, by and between the Company and Terry Lundgren *
|
|
Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on November 1, 2007
|
|
|
|
|
|
10.12
|
|
Form of Restricted Stock Agreement for the 1994 Stock Incentive Plan *
|
|
Exhibit 10.4 to the March 23, 2005 Form 8-K
|
|
|
|
|
|
10.12.1
|
|
Form of Time-Based Restricted Stock Agreement under the 2009 Omnibus Incentive Compensation
Plan *
|
|
Exhibit 10.3 to the Company's Current Report on Form 8-K filed on March 25, 2010
|
|
|
|
|
|
10.13
|
|
Form of Performance-Based Restricted Stock Unit Agreement under the Amended and Restated 2009 Omnibus Incentive Compensation Plan for the 2015-2017 performance period *
|
|
Exhibit 10.17.2 to the 2014 Form 10-K
|
|
|
|
|
|
10.13.1
|
|
2016-2018 Performance-Based Restricted Stock Unit Terms and Conditions *
|
|
Exhibit 10.13.2 to the 2015 Form 10-K
|
|
|
|
|
|
10.13.2
|
|
2017-2019 Performance-Based Restricted Stock Unit Terms and Conditions *
|
|
|
Exhibit
Number
|
|
Description
|
|
Document if Incorporated by Reference
|
10.14
|
|
Form of Time-Based Restricted Stock Unit Agreement under the 2009 Omnibus Incentive Compensation Plan *
|
|
Exhibit 10.19 to the 2012 Form 10-K
|
|
|
|
|
|
10.14.1
|
|
Form of Time-Based Restricted Stock Unit Agreement under the Amended and Restated 2009 Omnibus Incentive Compensation Plan *
|
|
Exhibit 10.18.1 to the 2014 Form 10-K
|
|
|
|
|
|
10.15
|
|
Supplementary Executive Retirement Plan *
|
|
Exhibit 10.29 to the 2008 Form 10-K
|
|
|
|
|
|
10.15.1
|
|
First Amendment to the Supplementary Executive Retirement Plan effective January 1, 2012 *
|
|
Exhibit 10.21.1 to the Company's Annual Report on Form 10-K (File No. 1-13536) for the fiscal year ended January 28, 2012
|
|
|
|
|
|
10.15.2
|
|
Second Amendment to Supplementary Executive Retirement Plan effective January 1, 2012 *
|
|
Exhibit 10.20.2 to the 2012 Form 10-K
|
|
|
|
|
|
10.15.3
|
|
Third Amendment to Supplementary Executive Retirement Plan effective December 31, 2013 *
|
|
Exhibit 10.20.3 to the 2013 Form 10-K
|
|
|
|
|
|
10.16
|
|
Executive Deferred Compensation Plan *
|
|
Exhibit 10.30 to the 2008 Form 10-K
|
|
|
|
|
|
10.16.1
|
|
First Amendment to Executive Deferred Compensation Plan effective December 19, 2013 *
|
|
Exhibit 10.21.1 to the 2013 Form 10-K
|
|
|
|
|
|
10.17
|
|
Macy's, Inc. 401(k) Retirement Investment Plan (the "Plan") (amending and restating the Macy's, Inc. 401(k) Retirement Investment Plan) effective as of January 1, 2014 *
|
|
Exhibit 10.22 to the 2013 Form 10-K
|
|
|
|
|
|
10.17.1
|
|
First Amendment to the Plan regarding matching contributions with respect to the Plan’s plan years beginning on and after January 1, 2014, effective January 1, 2014 *
|
|
Exhibit 10.21.1 to the 2014 Form 10-K
|
|
|
|
|
|
10.17.2
|
|
Second Amendment to the Plan regarding marriage status, effective January 1, 2014 *
|
|
Exhibit 10.21.2 to the 2014 Form 10-K
|
|
|
|
|
|
10.17.3
|
|
Third Amendment to the Plan regarding matching contributions with respect to the Plan’s plan years beginning on and after January 1, 2014 *
|
|
Exhibit 10.21.3 to the 2014 Form 10-K
|
|
|
|
|
|
10.17.4
|
|
Fourth Amendment to the Plan regarding rules applicable to Puerto Rico participants effective January 1, 2011 (and for the Plan's plan years beginning on and after that date)*
|
|
Exhibit 10.17.4 to the 2015 Form 10-K
|
|
|
|
|
|
10.17.5
|
|
Fifth Amendment to the Plan regarding eligible associates to participate (pre-tax deferrals only, no match) immediately upon hire*
|
|
Exhibit 10.17.5 to the 2015 Form 10-K
|
|
|
|
|
|
10.18
|
|
Director Deferred Compensation Plan *
|
|
Exhibit 10.33 to the 2008 Form 10-K
|
|
|
|
|
|
10.19
|
|
Macy's, Inc. Amended and Restated 2009 Omnibus Incentive Compensation Plan *
|
|
Appendix B to the Company's Proxy Statement dated April 2, 2014
|
|
|
|
|
|
10.20
|
|
Macy's, Inc. Deferred Compensation Plan *
|
|
Exhibit 4.5 to the Company's Registration Statement on Form S-8 (Registration No. 333-192917) filed on December 18, 2013
|
|
|
|
|
|
10.20.1
|
|
First Amendment to Deferred Compensation Plan regarding special rules of eligibility for newly eligible participants, effective April 1, 2014 *
|
|
Exhibit 10.24.1 to the 2014 Form 10-K
|
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Document if Incorporated by Reference
|
10.20.2
|
|
Second Amendment to Deferred Compensation Plan regarding payment rules for plan years that begin on or after January 1, 2015, effective January 1, 2014 *
|
|
Exhibit 10.24.2 to the 2014 Form 10-K
|
|
|
|
|
|
10.20.3
|
|
Third Amendment to Deferred Compensation Plan regarding a lump sum distribution from account if its balance does not exceed a certain amount, effective July 1, 2015*
|
|
Exhibit 10.20.3 to the 2015 Form 10-K
|
|
|
|
|
|
10.21
|
|
Change in Control Plan, effective November 1, 2009, as revised and restated January 1, 2014 *
|
|
Exhibit 10.26 to the 2013 Form 10-K
|
|
|
|
|
|
10.22
|
|
Amended and Restated Time Sharing Agreement between Macy's, Inc. and Terry J. Lundgren, dated August 21, 2014 *
|
|
Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q filed on September 8, 2014
|
|
|
|
|
|
10.23
|
|
General Release with Addendum between Macy's, Inc. and Peter R. Sachse *
|
|
|
|
|
|
|
|
21
|
|
Subsidiaries
|
|
|
|
|
|
|
|
23
|
|
Consent of KPMG LLP
|
|
|
|
|
|
|
|
24
|
|
Powers of Attorney
|
|
|
|
|
|
|
|
31.1
|
|
Certification of Chief Executive Officer pursuant to Rule 13a-14(a)
|
|
|
|
|
|
|
|
31.2
|
|
Certification of Chief Financial Officer pursuant to Rule 13a-14(a)
|
|
|
|
|
|
|
|
32.1
|
|
Certification by Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act
|
|
|
|
|
|
|
|
32.2
|
|
Certification by Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act
|
|
|
|
|
|
|
|
101
|
|
The following financial statements from Macy's, Inc.’s Annual Report on Form 10-K for the year ended January 28, 2017, filed on March 29, 2017, formatted in XBRL: (i) Consolidated Statements of Income, (ii) Consolidated Statements of Comprehensive Income, (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Changes in Shareholders’ Equity, (v) Consolidated Statements of Cash Flows, and (vi) the Notes to Consolidated Financial Statements, tagged as blocks of text and in detail.
|
|
|
+
|
Portions of the exhibit have been omitted pursuant to a request for confidential treatment. The confidential portions have been provided to the SEC.
|
*
|
Constitutes a compensatory plan or arrangement.
|
|
MACY’S, INC.
|
|
|
|
|
|
By:
|
/s/ ELISA D. GARCIA
|
|
|
Elisa D. Garcia
Chief Legal Officer and Secretary
|
|
|
|
|
|
*
|
|
*
|
|
*
|
Jeff Gennette
|
|
Karen M. Hoguet
|
|
Felicia Williams
|
|
|
|
|
|
President, Chief Executive Officer (principal executive officer), and Director
|
|
Chief Financial Officer (principal financial officer)
|
|
Executive Vice President, Controller and Enterprise Risk (principal accounting officer)
|
|
|
|
|
|
*
|
|
*
|
|
*
|
Terry J. Lundgren
|
|
Francis S. Blake
|
|
John A. Bryant
|
|
|
|
|
|
Executive Chairman, Chairman of the Board and Director
|
|
Director
|
|
Director
|
|
|
|
|
|
*
|
|
*
|
|
*
|
Deirdre P. Connelly
|
|
Leslie D. Hale
|
|
William H. Lenehan
|
|
|
|
|
|
Director
|
|
Director
|
|
Director
|
|
|
|
|
|
*
|
|
*
|
|
*
|
Sara Levinson
|
|
Joyce M. Roché
|
|
Paul C. Varga
|
|
|
|
|
|
Director
|
|
Director
|
|
Director
|
|
|
|
|
|
*
|
|
*
|
|
|
Marna C. Whittington
|
|
Annie Young-Scrivner
|
|
|
|
|
|
|
|
Director
|
|
Director
|
|
|
*
|
The undersigned, by signing his name hereto, does sign and execute this Annual Report on Form 10-K pursuant to the Powers of Attorney executed by the above-named officers and directors and filed herewith.
|
|
By:
|
/s/ ELISA D. GARCIA
|
|
|
Elisa D. Garcia
Attorney-in-Fact
|
|
Page
|
Consolidated Statements of Income for the fiscal years ended
January 28, 2017, January 30, 2016 and January 31, 2015 |
|
Consolidated Statements of Comprehensive Income for the fiscal years ended
January 28, 2017, January 30, 2016 and January 31, 2015 |
|
Consolidated Balance Sheets at January 28, 2017 and January 30, 2016
|
|
Consolidated Statements of Changes in Shareholders’ Equity for the fiscal years ended
January 28, 2017, January 30, 2016 and January 31, 2015 |
|
Consolidated Statements of Cash Flows for the fiscal years ended
January 28, 2017, January 30, 2016 and January 31, 2015 |
|
Notes to Consolidated Financial Statements
|
|
|
|
|
|
|
||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Net sales
|
$
|
25,778
|
|
|
$
|
27,079
|
|
|
$
|
28,105
|
|
Cost of sales
|
(15,621
|
)
|
|
(16,496
|
)
|
|
(16,863
|
)
|
|||
Gross margin
|
10,157
|
|
|
10,583
|
|
|
11,242
|
|
|||
Selling, general and administrative expenses
|
(8,265
|
)
|
|
(8,256
|
)
|
|
(8,355
|
)
|
|||
Impairments, store closing and other costs
|
(479
|
)
|
|
(288
|
)
|
|
(87
|
)
|
|||
Settlement charges
|
(98
|
)
|
|
—
|
|
|
—
|
|
|||
Operating income
|
1,315
|
|
|
2,039
|
|
|
2,800
|
|
|||
Interest expense
|
(367
|
)
|
|
(363
|
)
|
|
(395
|
)
|
|||
Premium on early retirement of debt
|
—
|
|
|
—
|
|
|
(17
|
)
|
|||
Interest income
|
4
|
|
|
2
|
|
|
2
|
|
|||
Income before income taxes
|
952
|
|
|
1,678
|
|
|
2,390
|
|
|||
Federal, state and local income tax expense
|
(341
|
)
|
|
(608
|
)
|
|
(864
|
)
|
|||
Net income
|
611
|
|
|
1,070
|
|
|
1,526
|
|
|||
Net loss attributable to noncontrolling interest
|
8
|
|
|
2
|
|
|
—
|
|
|||
Net income attributable to Macy's, Inc. shareholders
|
$
|
619
|
|
|
$
|
1,072
|
|
|
$
|
1,526
|
|
Basic earnings per share attributable to
Macy's, Inc. shareholders
|
$
|
2.01
|
|
|
$
|
3.26
|
|
|
$
|
4.30
|
|
Diluted earnings per share attributable to
Macy's, Inc. shareholders |
$
|
1.99
|
|
|
$
|
3.22
|
|
|
$
|
4.22
|
|
|
|
|
|
|
|
||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Net income
|
$
|
611
|
|
|
$
|
1,070
|
|
|
$
|
1,526
|
|
Other comprehensive income (loss), net of taxes:
|
|
|
|
|
|
||||||
Actuarial gain (loss) and prior service cost on post employment
and postretirement benefit plans, net of tax effect of $42 million and $269 million |
65
|
|
|
—
|
|
|
(422
|
)
|
|||
Reclassifications to net income:
|
|
|
|
|
|
||||||
Net actuarial loss on post employment and postretirement
benefit plans, net of tax effect of $14 million, $19 million and $10 million |
22
|
|
|
29
|
|
|
15
|
|
|||
Settlement charges, net of tax effect of $38 million
|
60
|
|
|
—
|
|
|
—
|
|
|||
Total other comprehensive income (loss)
|
147
|
|
|
29
|
|
|
(407
|
)
|
|||
Comprehensive income
|
758
|
|
|
1,099
|
|
|
1,119
|
|
|||
Comprehensive loss attributable to noncontrolling interest
|
8
|
|
|
2
|
|
|
—
|
|
|||
Comprehensive income attributable to
Macy's, Inc. shareholders
|
$
|
766
|
|
|
$
|
1,101
|
|
|
$
|
1,119
|
|
|
|
|
|
||||
|
January 28, 2017
|
|
January 30, 2016
|
||||
ASSETS
|
|
|
|
||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,297
|
|
|
$
|
1,109
|
|
Receivables
|
522
|
|
|
558
|
|
||
Merchandise inventories
|
5,399
|
|
|
5,506
|
|
||
Prepaid expenses and other current assets
|
408
|
|
|
479
|
|
||
Total Current Assets
|
7,626
|
|
|
7,652
|
|
||
Property and Equipment – net
|
7,017
|
|
|
7,616
|
|
||
Goodwill
|
3,897
|
|
|
3,897
|
|
||
Other Intangible Assets – net
|
498
|
|
|
514
|
|
||
Other Assets
|
813
|
|
|
897
|
|
||
Total Assets
|
$
|
19,851
|
|
|
$
|
20,576
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
||||
Current Liabilities:
|
|
|
|
||||
Short-term debt
|
$
|
309
|
|
|
$
|
642
|
|
Merchandise accounts payable
|
1,423
|
|
|
1,526
|
|
||
Accounts payable and accrued liabilities
|
3,563
|
|
|
3,333
|
|
||
Income taxes
|
352
|
|
|
227
|
|
||
Total Current Liabilities
|
5,647
|
|
|
5,728
|
|
||
Long-Term Debt
|
6,562
|
|
|
6,995
|
|
||
Deferred Income Taxes
|
1,443
|
|
|
1,477
|
|
||
Other Liabilities
|
1,877
|
|
|
2,123
|
|
||
Shareholders’ Equity:
|
|
|
|
||||
Common stock (304.1 and 310.3 shares outstanding)
|
3
|
|
|
3
|
|
||
Additional paid-in capital
|
617
|
|
|
621
|
|
||
Accumulated equity
|
6,088
|
|
|
6,334
|
|
||
Treasury stock
|
(1,489
|
)
|
|
(1,665
|
)
|
||
Accumulated other comprehensive loss
|
(896
|
)
|
|
(1,043
|
)
|
||
Total Macy's, Inc. Shareholders’ Equity
|
4,323
|
|
|
4,250
|
|
||
Noncontrolling interest
|
(1
|
)
|
|
3
|
|
||
Total Shareholders' Equity
|
4,322
|
|
|
4,253
|
|
||
Total Liabilities and Shareholders’ Equity
|
$
|
19,851
|
|
|
$
|
20,576
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Common
Stock
|
|
Additional
Paid-In
Capital
|
|
Accumulated
Equity
|
|
Treasury
Stock
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Total
Macy's, Inc.
Shareholders’
Equity
|
|
Non-controlling
Interest
|
|
Total Shareholders' Equity
|
||||||||||||||||
Balance at February 1, 2014
|
$
|
4
|
|
|
$
|
2,522
|
|
|
$
|
6,235
|
|
|
$
|
(1,847
|
)
|
|
$
|
(665
|
)
|
|
$
|
6,249
|
|
|
$
|
—
|
|
|
$
|
6,249
|
|
Net income
|
|
|
|
|
1,526
|
|
|
|
|
|
|
1,526
|
|
|
|
|
1,526
|
|
|||||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
|
(407
|
)
|
|
(407
|
)
|
|
|
|
(407
|
)
|
|||||||||||||
Common stock dividends
($1.1875 per share)
|
|
|
|
|
(421
|
)
|
|
|
|
|
|
(421
|
)
|
|
|
|
(421
|
)
|
|||||||||||||
Stock repurchases
|
|
|
|
|
|
|
(1,901
|
)
|
|
|
|
(1,901
|
)
|
|
|
|
(1,901
|
)
|
|||||||||||||
Stock-based compensation
expense
|
|
|
72
|
|
|
|
|
|
|
|
|
72
|
|
|
|
|
72
|
|
|||||||||||||
Stock issued under stock plans
|
|
|
(66
|
)
|
|
|
|
324
|
|
|
|
|
258
|
|
|
|
|
258
|
|
||||||||||||
Retirement of common stock
|
|
|
(1,480
|
)
|
|
|
|
1,480
|
|
|
|
|
—
|
|
|
|
|
—
|
|
||||||||||||
Deferred compensation
plan distributions
|
|
|
|
|
|
|
2
|
|
|
|
|
2
|
|
|
|
|
2
|
|
|||||||||||||
Balance at January 31, 2015
|
4
|
|
|
1,048
|
|
|
7,340
|
|
|
(1,942
|
)
|
|
(1,072
|
)
|
|
5,378
|
|
|
—
|
|
|
5,378
|
|
||||||||
Net income (loss)
|
|
|
|
|
1,072
|
|
|
|
|
|
|
1,072
|
|
|
(2
|
)
|
|
1,070
|
|
||||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
|
29
|
|
|
29
|
|
|
|
|
29
|
|
|||||||||||||
Common stock dividends ($1.3925 per share)
|
|
|
|
|
(456
|
)
|
|
|
|
|
|
(456
|
)
|
|
|
|
(456
|
)
|
|||||||||||||
Stock repurchases
|
|
|
|
|
|
|
(2,001
|
)
|
|
|
|
(2,001
|
)
|
|
|
|
(2,001
|
)
|
|||||||||||||
Stock-based compensation
expense |
|
|
64
|
|
|
|
|
|
|
|
|
64
|
|
|
|
|
64
|
|
|||||||||||||
Stock issued under stock plans
|
|
|
(64
|
)
|
|
|
|
226
|
|
|
|
|
162
|
|
|
|
|
162
|
|
||||||||||||
Retirement of common stock
|
(1
|
)
|
|
(427
|
)
|
|
(1,622
|
)
|
|
2,050
|
|
|
|
|
—
|
|
|
|
|
—
|
|
||||||||||
Deferred compensation
plan distributions
|
|
|
|
|
|
|
2
|
|
|
|
|
2
|
|
|
|
|
2
|
|
|||||||||||||
Macy's China Limited
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
5
|
|
|
5
|
|
|||||||||||||
Balance at January 30, 2016
|
3
|
|
|
621
|
|
|
6,334
|
|
|
(1,665
|
)
|
|
(1,043
|
)
|
|
4,250
|
|
|
3
|
|
|
4,253
|
|
||||||||
Net income (loss)
|
|
|
|
|
619
|
|
|
|
|
|
|
619
|
|
|
(8
|
)
|
|
611
|
|
||||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
|
147
|
|
|
147
|
|
|
|
|
147
|
|
|||||||||||||
Common stock dividends ($1.4925 per share)
|
|
|
|
|
(459
|
)
|
|
|
|
|
|
(459
|
)
|
|
|
|
(459
|
)
|
|||||||||||||
Stock repurchases
|
|
|
|
|
|
|
(316
|
)
|
|
|
|
(316
|
)
|
|
|
|
(316
|
)
|
|||||||||||||
Stock-based compensation
expense |
|
|
60
|
|
|
|
|
|
|
|
|
60
|
|
|
|
|
60
|
|
|||||||||||||
Stock issued under stock plans
|
|
|
(64
|
)
|
|
|
|
81
|
|
|
|
|
17
|
|
|
|
|
17
|
|
||||||||||||
Retirement of common stock
|
|
|
|
|
|
(406
|
)
|
|
406
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|||||||||||
Deferred compensation
plan distributions
|
|
|
|
|
|
|
5
|
|
|
|
|
5
|
|
|
|
|
5
|
|
|||||||||||||
Macy's China Limited
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
4
|
|
|
4
|
|
|||||||||||||
Balance at January 28, 2017
|
$
|
3
|
|
|
$
|
617
|
|
|
$
|
6,088
|
|
|
$
|
(1,489
|
)
|
|
$
|
(896
|
)
|
|
$
|
4,323
|
|
|
$
|
(1
|
)
|
|
$
|
4,322
|
|
|
|
|
|
|
|
||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
611
|
|
|
$
|
1,070
|
|
|
$
|
1,526
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|||||||
Impairments, store closing and other costs
|
479
|
|
|
288
|
|
|
87
|
|
|||
Settlement charges
|
98
|
|
|
—
|
|
|
—
|
|
|||
Depreciation and amortization
|
1,058
|
|
|
1,061
|
|
|
1,036
|
|
|||
Stock-based compensation expense
|
61
|
|
|
65
|
|
|
73
|
|
|||
Gains on sale of real estate
|
(209
|
)
|
|
(212
|
)
|
|
(92
|
)
|
|||
Amortization of financing costs and premium on acquired debt
|
(14
|
)
|
|
(14
|
)
|
|
(5
|
)
|
|||
Changes in assets and liabilities:
|
|
|
|
|
|
||||||
(Increase) decrease in receivables
|
(1
|
)
|
|
(45
|
)
|
|
22
|
|
|||
(Increase) decrease in merchandise inventories
|
107
|
|
|
(60
|
)
|
|
44
|
|
|||
Increase in prepaid expenses and other current assets
|
(8
|
)
|
|
—
|
|
|
(3
|
)
|
|||
Increase in other assets not separately identified
|
—
|
|
|
(1
|
)
|
|
(61
|
)
|
|||
Decrease in merchandise accounts payable
|
(132
|
)
|
|
(78
|
)
|
|
(21
|
)
|
|||
Increase (decrease) in accounts payable, accrued
liabilities and other items not separately identified |
(162
|
)
|
|
68
|
|
|
129
|
|
|||
Increase (decrease) in current income taxes
|
125
|
|
|
(69
|
)
|
|
(65
|
)
|
|||
Increase (decrease) in deferred income taxes
|
(139
|
)
|
|
(1
|
)
|
|
29
|
|
|||
Increase (decrease) in other liabilities not separately identified
|
(73
|
)
|
|
(88
|
)
|
|
10
|
|
|||
Net cash provided by operating activities
|
1,801
|
|
|
1,984
|
|
|
2,709
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Purchase of property and equipment
|
(596
|
)
|
|
(777
|
)
|
|
(770
|
)
|
|||
Capitalized software
|
(316
|
)
|
|
(336
|
)
|
|
(298
|
)
|
|||
Acquisition of Bluemercury, Inc., net of cash acquired
|
—
|
|
|
(212
|
)
|
|
—
|
|
|||
Disposition of property and equipment
|
673
|
|
|
204
|
|
|
172
|
|
|||
Other, net
|
52
|
|
|
29
|
|
|
(74
|
)
|
|||
Net cash used by investing activities
|
(187
|
)
|
|
(1,092
|
)
|
|
(970
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Debt issued
|
2
|
|
|
499
|
|
|
1,044
|
|
|||
Financing costs
|
(3
|
)
|
|
(4
|
)
|
|
(9
|
)
|
|||
Debt repaid
|
(751
|
)
|
|
(152
|
)
|
|
(870
|
)
|
|||
Dividends paid
|
(459
|
)
|
|
(456
|
)
|
|
(421
|
)
|
|||
Increase (decrease) in outstanding checks
|
61
|
|
|
(83
|
)
|
|
133
|
|
|||
Acquisition of treasury stock
|
(316
|
)
|
|
(2,001
|
)
|
|
(1,901
|
)
|
|||
Issuance of common stock
|
36
|
|
|
163
|
|
|
258
|
|
|||
Proceeds from noncontrolling interest
|
4
|
|
|
5
|
|
|
—
|
|
|||
Net cash used by financing activities
|
(1,426
|
)
|
|
(2,029
|
)
|
|
(1,766
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
188
|
|
|
(1,137
|
)
|
|
(27
|
)
|
|||
Cash and cash equivalents beginning of period
|
1,109
|
|
|
2,246
|
|
|
2,273
|
|
|||
Cash and cash equivalents end of period
|
$
|
1,297
|
|
|
$
|
1,109
|
|
|
$
|
2,246
|
|
Supplemental cash flow information:
|
|
|
|
|
|
||||||
Interest paid
|
$
|
396
|
|
|
$
|
383
|
|
|
$
|
413
|
|
Interest received
|
4
|
|
|
2
|
|
|
2
|
|
|||
Income taxes paid (net of refunds received)
|
352
|
|
|
635
|
|
|
834
|
|
|
1.
|
Organization and Summary of Significant Accounting Policies
|
|
2016
|
|
2015
|
|
2014
|
|||
Women’s Accessories, Intimate Apparel, Shoes, Cosmetics and Fragrances
|
38
|
%
|
|
38
|
%
|
|
38
|
%
|
Women’s Apparel
|
23
|
|
|
23
|
|
|
23
|
|
Men’s and Children’s
|
23
|
|
|
23
|
|
|
23
|
|
Home/Miscellaneous
|
16
|
|
|
16
|
|
|
16
|
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
Gross advertising and promotional costs
|
$
|
1,547
|
|
|
$
|
1,587
|
|
|
$
|
1,602
|
|
Cooperative advertising allowances
|
394
|
|
|
414
|
|
|
425
|
|
|||
Advertising and promotional costs, net of
cooperative advertising allowances |
$
|
1,153
|
|
|
$
|
1,173
|
|
|
$
|
1,177
|
|
Net sales
|
$
|
25,778
|
|
|
$
|
27,079
|
|
|
$
|
28,105
|
|
Advertising and promotional costs, net of cooperative
advertising allowances, as a percent to net sales |
4.5
|
%
|
|
4.3
|
%
|
|
4.2
|
%
|
|
|
|
2.
|
Impairments, Store Closing and Other Costs
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
Asset Impairments
|
$
|
265
|
|
|
$
|
148
|
|
|
$
|
33
|
|
Severance
|
168
|
|
|
123
|
|
|
46
|
|
|||
Other
|
46
|
|
|
17
|
|
|
8
|
|
|||
|
$
|
479
|
|
|
$
|
288
|
|
|
$
|
87
|
|
|
3.
|
Receivables
|
|
4.
|
Properties and Leases
|
|
January 28,
2017 |
|
January 30,
2016 |
||||
|
(millions)
|
||||||
Land
|
$
|
1,541
|
|
|
$
|
1,629
|
|
Buildings on owned land
|
4,212
|
|
|
4,690
|
|
||
Buildings on leased land and leasehold improvements
|
1,545
|
|
|
1,672
|
|
||
Fixtures and equipment
|
4,541
|
|
|
4,910
|
|
||
Leased properties under capitalized leases
|
34
|
|
|
34
|
|
||
|
11,873
|
|
|
12,935
|
|
||
Less accumulated depreciation and amortization
|
4,856
|
|
|
5,319
|
|
||
|
$
|
7,017
|
|
|
$
|
7,616
|
|
|
Capitalized
Leases
|
|
Operating
Leases
|
|
Total
|
||||||
|
(millions)
|
||||||||||
Fiscal year
|
|
|
|
|
|
||||||
2017
|
$
|
3
|
|
|
$
|
321
|
|
|
$
|
324
|
|
2018
|
3
|
|
|
304
|
|
|
307
|
|
|||
2019
|
3
|
|
|
283
|
|
|
286
|
|
|||
2020
|
3
|
|
|
249
|
|
|
252
|
|
|||
2021
|
3
|
|
|
237
|
|
|
240
|
|
|||
After 2021
|
37
|
|
|
2,289
|
|
|
2,326
|
|
|||
Total minimum lease payments
|
52
|
|
|
$
|
3,683
|
|
|
$
|
3,735
|
|
|
Less amount representing interest
|
24
|
|
|
|
|
|
|||||
Present value of net minimum capitalized lease payments
|
$
|
28
|
|
|
|
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
Real estate (excluding executory costs)
|
|
|
|
|
|
||||||
Capitalized leases –
|
|
|
|
|
|
||||||
Contingent rentals
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Operating leases –
|
|
|
|
|
|
||||||
Minimum rentals
|
312
|
|
|
288
|
|
|
265
|
|
|||
Contingent rentals
|
12
|
|
|
19
|
|
|
22
|
|
|||
|
324
|
|
|
307
|
|
|
287
|
|
|||
Less income from subleases –
|
|
|
|
|
|
||||||
Operating leases
|
(5
|
)
|
|
(6
|
)
|
|
(8
|
)
|
|||
|
$
|
319
|
|
|
$
|
301
|
|
|
$
|
279
|
|
Personal property – Operating leases
|
$
|
11
|
|
|
$
|
12
|
|
|
$
|
12
|
|
|
5.
|
Goodwill and Other Intangible Assets
|
|
January 28,
2017 |
|
January 30,
2016 |
||||
|
(millions)
|
||||||
Non-amortizing intangible assets
|
|
|
|
||||
Goodwill
|
$
|
9,279
|
|
|
$
|
9,279
|
|
Accumulated impairment losses
|
(5,382
|
)
|
|
(5,382
|
)
|
||
|
3,897
|
|
|
3,897
|
|
||
Tradenames
|
403
|
|
|
414
|
|
||
|
$
|
4,300
|
|
|
$
|
4,311
|
|
Amortizing intangible assets
|
|
|
|
||||
Favorable leases and other contractual assets
|
$
|
141
|
|
|
$
|
149
|
|
Tradenames
|
43
|
|
|
43
|
|
||
|
184
|
|
|
192
|
|
||
Accumulated amortization
|
|
|
|
||||
Favorable leases and other contractual assets
|
(85
|
)
|
|
(90
|
)
|
||
Tradenames
|
(4
|
)
|
|
(2
|
)
|
||
|
(89
|
)
|
|
(92
|
)
|
||
|
$
|
95
|
|
|
$
|
100
|
|
|
6.
|
Financing
|
|
January 28,
2017 |
|
January 30,
2016 |
||||
|
(millions)
|
||||||
Short-term debt:
|
|
|
|
||||
7.45% Senior debentures due 2017
|
$
|
300
|
|
|
$
|
—
|
|
5.9% Senior notes due 2016
|
—
|
|
|
577
|
|
||
7.45% Senior debentures due 2016
|
—
|
|
|
59
|
|
||
Capital lease and current portion of other long-term obligations
|
9
|
|
|
6
|
|
||
|
$
|
309
|
|
|
$
|
642
|
|
Long-term debt:
|
|
|
|
||||
2.875% Senior notes due 2023
|
$
|
750
|
|
|
$
|
750
|
|
3.875% Senior notes due 2022
|
550
|
|
|
550
|
|
||
4.5% Senior notes due 2034
|
550
|
|
|
550
|
|
||
3.45% Senior notes due 2021
|
500
|
|
|
500
|
|
||
3.625% Senior notes due 2024
|
500
|
|
|
500
|
|
||
6.375% Senior notes due 2037
|
500
|
|
|
500
|
|
||
4.375% Senior notes due 2023
|
400
|
|
|
400
|
|
||
6.9% Senior debentures due 2029
|
400
|
|
|
400
|
|
||
6.7% Senior debentures due 2034
|
400
|
|
|
400
|
|
||
7.45% Senior debentures due 2017
|
—
|
|
|
300
|
|
||
6.65% Senior debentures due 2024
|
300
|
|
|
300
|
|
||
7.0% Senior debentures due 2028
|
300
|
|
|
300
|
|
||
6.9% Senior debentures due 2032
|
250
|
|
|
250
|
|
||
5.125% Senior debentures due 2042
|
250
|
|
|
250
|
|
||
4.3% Senior notes due 2043
|
250
|
|
|
250
|
|
||
6.7% Senior debentures due 2028
|
200
|
|
|
200
|
|
||
6.79% Senior debentures due 2027
|
165
|
|
|
165
|
|
||
7.875% Senior debentures due 2036
|
—
|
|
|
108
|
|
||
8.75% Senior debentures due 2029
|
61
|
|
|
61
|
|
||
8.5% Senior debentures due 2019
|
36
|
|
|
36
|
|
||
10.25% Senior debentures due 2021
|
33
|
|
|
33
|
|
||
7.6% Senior debentures due 2025
|
24
|
|
|
24
|
|
||
7.875% Senior debentures due 2030
|
18
|
|
|
18
|
|
||
9.5% amortizing debentures due 2021
|
14
|
|
|
17
|
|
||
9.75% amortizing debentures due 2021
|
8
|
|
|
9
|
|
||
Unamortized debt issue costs
|
(29
|
)
|
|
(32
|
)
|
||
Unamortized debt discount
|
(16
|
)
|
|
(16
|
)
|
||
Premium on acquired debt, using an effective
interest yield of 5.542% to 6.021% |
121
|
|
|
143
|
|
||
Capital lease and other long-term obligations
|
27
|
|
|
29
|
|
||
|
$
|
6,562
|
|
|
$
|
6,995
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
Interest on debt
|
$
|
392
|
|
|
$
|
393
|
|
|
$
|
411
|
|
Amortization of debt premium
|
(22
|
)
|
|
(21
|
)
|
|
(12
|
)
|
|||
Amortization of financing costs and debt discount
|
5
|
|
|
6
|
|
|
7
|
|
|||
Interest on capitalized leases
|
2
|
|
|
2
|
|
|
2
|
|
|||
|
377
|
|
|
380
|
|
|
408
|
|
|||
Less interest capitalized on construction
|
10
|
|
|
17
|
|
|
13
|
|
|||
Interest expense
|
$
|
367
|
|
|
$
|
363
|
|
|
$
|
395
|
|
Premium on early retirement of debt
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17
|
|
|
(millions)
|
||
Fiscal year
|
|
||
2018
|
$
|
6
|
|
2019
|
42
|
|
|
2020
|
539
|
|
|
2021
|
553
|
|
|
2022
|
—
|
|
|
After 2022
|
5,319
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
5.9% Senior notes due 2016
|
$
|
577
|
|
|
$
|
—
|
|
|
$
|
—
|
|
7.875% Senior notes due 2036
|
108
|
|
|
—
|
|
|
—
|
|
|||
7.45% Senior debentures due 2016
|
59
|
|
|
—
|
|
|
—
|
|
|||
7.5% Senior debentures due 2015
|
—
|
|
|
69
|
|
|
—
|
|
|||
8.125% Senior debentures due 2035
|
—
|
|
|
76
|
|
|
—
|
|
|||
5.75% Senior notes due 2014
|
—
|
|
|
—
|
|
|
453
|
|
|||
7.875% Senior debentures due 2015
|
—
|
|
|
—
|
|
|
407
|
|
|||
9.5% amortizing debentures due 2021
|
4
|
|
|
4
|
|
|
4
|
|
|||
9.75% amortizing debentures due 2021
|
2
|
|
|
3
|
|
|
2
|
|
|||
Capital leases and other obligations
|
1
|
|
|
—
|
|
|
4
|
|
|||
|
$
|
751
|
|
|
$
|
152
|
|
|
$
|
870
|
|
|
|
7.
|
Accounts Payable and Accrued Liabilities
|
|
January 28,
2017 |
|
January 30,
2016 |
||||
|
(millions)
|
||||||
Accounts payable
|
$
|
754
|
|
|
$
|
814
|
|
Gift cards and customer rewards
|
970
|
|
|
920
|
|
||
Deferred real estate gains
|
340
|
|
|
104
|
|
||
Current portion of post employment and postretirement benefits
|
208
|
|
|
257
|
|
||
Taxes other than income taxes
|
166
|
|
|
184
|
|
||
Lease related liabilities
|
174
|
|
|
165
|
|
||
Accrued wages and vacation
|
215
|
|
|
153
|
|
||
Current portion of workers’ compensation and general liability reserves
|
119
|
|
|
127
|
|
||
Severance and relocation
|
166
|
|
|
123
|
|
||
Allowance for future sales returns
|
96
|
|
|
112
|
|
||
Accrued interest
|
74
|
|
|
88
|
|
||
Other
|
281
|
|
|
286
|
|
||
|
$
|
3,563
|
|
|
$
|
3,333
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
Balance, beginning of year
|
$
|
508
|
|
|
$
|
505
|
|
|
$
|
497
|
|
Charged to costs and expenses
|
145
|
|
|
159
|
|
|
160
|
|
|||
Payments, net of recoveries
|
(150
|
)
|
|
(156
|
)
|
|
(152
|
)
|
|||
Balance, end of year
|
$
|
503
|
|
|
$
|
508
|
|
|
$
|
505
|
|
|
8.
|
Taxes
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||||||||||||||
|
Current
|
|
Deferred
|
|
Total
|
|
Current
|
|
Deferred
|
|
Total
|
|
Current
|
|
Deferred
|
|
Total
|
||||||||||||||||||
|
(millions)
|
||||||||||||||||||||||||||||||||||
Federal
|
$
|
433
|
|
|
$
|
(125
|
)
|
|
$
|
308
|
|
|
$
|
536
|
|
|
$
|
—
|
|
|
$
|
536
|
|
|
$
|
743
|
|
|
$
|
28
|
|
|
$
|
771
|
|
State and local
|
37
|
|
|
(4
|
)
|
|
33
|
|
|
72
|
|
|
—
|
|
|
72
|
|
|
92
|
|
|
1
|
|
|
93
|
|
|||||||||
|
$
|
470
|
|
|
$
|
(129
|
)
|
|
$
|
341
|
|
|
$
|
608
|
|
|
$
|
—
|
|
|
$
|
608
|
|
|
$
|
835
|
|
|
$
|
29
|
|
|
$
|
864
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
Expected tax
|
$
|
333
|
|
|
$
|
587
|
|
|
$
|
836
|
|
State and local income taxes, net of federal income tax benefit
|
12
|
|
|
43
|
|
|
59
|
|
|||
Historic rehabilitation tax credit
|
(1
|
)
|
|
(12
|
)
|
|
(20
|
)
|
|||
Change in valuation allowance
|
9
|
|
|
3
|
|
|
1
|
|
|||
Other
|
(12
|
)
|
|
(13
|
)
|
|
(12
|
)
|
|||
|
$
|
341
|
|
|
$
|
608
|
|
|
$
|
864
|
|
|
|
January 28,
2017 |
|
January 30,
2016 |
||||
|
(millions)
|
||||||
Deferred tax assets
|
|
|
|
||||
Post employment and postretirement benefits
|
$
|
405
|
|
|
$
|
536
|
|
Accrued liabilities accounted for on a cash basis for tax purposes
|
379
|
|
|
340
|
|
||
Long-term debt
|
63
|
|
|
73
|
|
||
Unrecognized state tax benefits and accrued interest
|
76
|
|
|
79
|
|
||
State operating loss and credit carryforwards
|
79
|
|
|
82
|
|
||
Other
|
347
|
|
|
206
|
|
||
Valuation allowance
|
(36
|
)
|
|
(27
|
)
|
||
Total deferred tax assets
|
1,313
|
|
|
1,289
|
|
||
Deferred tax liabilities
|
|
|
|
||||
Excess of book basis over tax basis of property and equipment
|
(1,381
|
)
|
|
(1,485
|
)
|
||
Merchandise inventories
|
(604
|
)
|
|
(606
|
)
|
||
Intangible assets
|
(380
|
)
|
|
(345
|
)
|
||
Other
|
(391
|
)
|
|
(330
|
)
|
||
Total deferred tax liabilities
|
(2,756
|
)
|
|
(2,766
|
)
|
||
Net deferred tax liability
|
$
|
(1,443
|
)
|
|
$
|
(1,477
|
)
|
|
January 28,
2017 |
|
January 30,
2016 |
|
January 31,
2015 |
||||||
|
(millions)
|
||||||||||
Balance, beginning of year
|
$
|
178
|
|
|
$
|
172
|
|
|
$
|
189
|
|
Additions based on tax positions related to the current year
|
16
|
|
|
30
|
|
|
33
|
|
|||
Additions for tax positions of prior years
|
—
|
|
|
—
|
|
|
—
|
|
|||
Reductions for tax positions of prior years
|
(12
|
)
|
|
(7
|
)
|
|
(15
|
)
|
|||
Settlements
|
(4
|
)
|
|
(3
|
)
|
|
(23
|
)
|
|||
Statute expirations
|
(11
|
)
|
|
(14
|
)
|
|
(12
|
)
|
|||
Balance, end of year
|
$
|
167
|
|
|
$
|
178
|
|
|
$
|
172
|
|
Amounts recognized in the Consolidated Balance Sheets at
January 28, 2017, January 30, 2016 and January 31, 2015
|
|
|
|
|
|
||||||
Current income taxes
|
$
|
6
|
|
|
$
|
12
|
|
|
$
|
11
|
|
Long-term deferred income taxes
|
4
|
|
|
5
|
|
|
6
|
|
|||
Other liabilities
|
157
|
|
|
161
|
|
|
155
|
|
|||
|
$
|
167
|
|
|
$
|
178
|
|
|
$
|
172
|
|
|
9.
|
Retirement Plans
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
401(k) Qualified Defined Contribution Plan
|
$
|
94
|
|
|
$
|
88
|
|
|
$
|
89
|
|
Non-Qualified Defined Contribution Plan
|
2
|
|
|
2
|
|
|
2
|
|
|||
Pension Plan
|
(83
|
)
|
|
(54
|
)
|
|
(64
|
)
|
|||
Supplementary Retirement Plan
|
31
|
|
|
41
|
|
|
38
|
|
|||
|
$
|
44
|
|
|
$
|
77
|
|
|
$
|
65
|
|
|
|
2016
|
|
2015
|
||||
|
(millions)
|
||||||
Change in projected benefit obligation
|
|
|
|
||||
Projected benefit obligation, beginning of year
|
$
|
3,585
|
|
|
$
|
3,966
|
|
Service cost
|
5
|
|
|
6
|
|
||
Interest cost
|
108
|
|
|
137
|
|
||
Actuarial (gain) loss
|
55
|
|
|
(282
|
)
|
||
Benefits paid
|
(284
|
)
|
|
(242
|
)
|
||
Projected benefit obligation, end of year
|
3,469
|
|
|
3,585
|
|
||
Changes in plan assets
|
|
|
|
||||
Fair value of plan assets, beginning of year
|
3,256
|
|
|
3,636
|
|
||
Actual return on plan assets
|
402
|
|
|
(138
|
)
|
||
Company contributions
|
—
|
|
|
—
|
|
||
Benefits paid
|
(284
|
)
|
|
(242
|
)
|
||
Fair value of plan assets, end of year
|
3,374
|
|
|
3,256
|
|
||
Funded status at end of year
|
$
|
(95
|
)
|
|
$
|
(329
|
)
|
Amounts recognized in the Consolidated Balance Sheets at
January 28, 2017 and January 30, 2016 |
|
|
|
||||
Other liabilities
|
$
|
(95
|
)
|
|
$
|
(329
|
)
|
|
|
|
|
||||
Amounts recognized in accumulated other comprehensive loss at
January 28, 2017 and January 30, 2016 |
|
|
|
||||
Net actuarial loss
|
$
|
1,232
|
|
|
$
|
1,451
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
Net Periodic Pension Cost
|
|
|
|
|
|
||||||
Service cost
|
$
|
5
|
|
|
$
|
6
|
|
|
$
|
6
|
|
Interest cost
|
108
|
|
|
137
|
|
|
151
|
|
|||
Expected return on assets
|
(227
|
)
|
|
(235
|
)
|
|
(246
|
)
|
|||
Amortization of net actuarial loss
|
31
|
|
|
38
|
|
|
25
|
|
|||
Amortization of prior service credit
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
(83
|
)
|
|
(54
|
)
|
|
(64
|
)
|
|||
|
|
|
|
|
|
||||||
Settlement charges
|
68
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
||||||
Other Changes in Plan Assets and Projected Benefit Obligation
Recognized in Other Comprehensive Loss |
|
|
|
|
|
||||||
Net actuarial (gain) loss
|
(120
|
)
|
|
92
|
|
|
491
|
|
|||
Amortization of net actuarial loss
|
(31
|
)
|
|
(38
|
)
|
|
(25
|
)
|
|||
Amortization of prior service credit
|
—
|
|
|
—
|
|
|
—
|
|
|||
Settlement charges
|
(68
|
)
|
|
—
|
|
|
—
|
|
|||
|
(219
|
)
|
|
54
|
|
|
466
|
|
|||
Total recognized
|
$
|
(234
|
)
|
|
$
|
—
|
|
|
$
|
402
|
|
|
2016
|
|
2015
|
||
Discount rate
|
4.00
|
%
|
|
4.17
|
%
|
Rate of compensation increases
|
4.10
|
%
|
|
4.10
|
%
|
|
2016
|
|
2015
|
|
2014
|
|||
Discount rate used to measure service cost
|
3.79% - 4.26%
|
|
|
3.55
|
%
|
|
4.50
|
%
|
Discount rate used to measure interest cost
|
2.96% - 3.30%
|
|
|
3.55
|
%
|
|
4.50
|
%
|
Expected long-term return on plan assets
|
7.00
|
%
|
|
7.00
|
%
|
|
7.50
|
%
|
Rate of compensation increases
|
4.10
|
%
|
|
4.10
|
%
|
|
4.10
|
%
|
|
|
|
Fair Value Measurements
|
||||||||||||||
|
Total
|
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
|
(millions)
|
||||||||||||||
Short term investments
|
$
|
14
|
|
|
$
|
—
|
|
|
$
|
14
|
|
|
$
|
—
|
|
Money market funds
|
74
|
|
|
74
|
|
|
—
|
|
|
—
|
|
||||
Equity securities:
|
|
|
|
|
|
|
|
||||||||
U.S. stocks
|
309
|
|
|
309
|
|
|
—
|
|
|
—
|
|
||||
U.S. pooled funds (a)
|
654
|
|
|
446
|
|
|
—
|
|
|
—
|
|
||||
International pooled funds (a)
|
649
|
|
|
131
|
|
|
—
|
|
|
—
|
|
||||
Fixed income securities:
|
|
|
|
|
|
|
|
||||||||
U. S. Treasury bonds
|
194
|
|
|
—
|
|
|
194
|
|
|
—
|
|
||||
Other Government bonds
|
40
|
|
|
—
|
|
|
40
|
|
|
—
|
|
||||
Agency backed bonds
|
24
|
|
|
—
|
|
|
24
|
|
|
—
|
|
||||
Corporate bonds
|
453
|
|
|
—
|
|
|
453
|
|
|
—
|
|
||||
Mortgage-backed securities
|
85
|
|
|
—
|
|
|
85
|
|
|
—
|
|
||||
Asset-backed securities
|
17
|
|
|
—
|
|
|
17
|
|
|
—
|
|
||||
Pooled funds
|
461
|
|
|
461
|
|
|
—
|
|
|
—
|
|
||||
Other types of investments:
|
|
|
|
|
|
|
|
||||||||
Real estate (a)
|
223
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Private equity (a)
|
186
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Derivatives in a positive position
|
13
|
|
|
—
|
|
|
13
|
|
|
—
|
|
||||
Derivatives in a negative position
|
(19
|
)
|
|
—
|
|
|
(19
|
)
|
|
—
|
|
||||
Total
|
$
|
3,377
|
|
|
$
|
1,421
|
|
|
$
|
821
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements
|
||||||||||||||
|
Total
|
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
|
(millions)
|
||||||||||||||
Cash and cash equivalents
|
$
|
15
|
|
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Short term investments
|
36
|
|
|
—
|
|
|
36
|
|
|
—
|
|
||||
Money market funds
|
46
|
|
|
46
|
|
|
—
|
|
|
—
|
|
||||
Equity securities:
|
|
|
|
|
|
|
|
||||||||
U.S. stocks
|
280
|
|
|
280
|
|
|
—
|
|
|
—
|
|
||||
U.S. pooled funds (a)
|
391
|
|
|
207
|
|
|
—
|
|
|
—
|
|
||||
International pooled funds (a)
|
575
|
|
|
336
|
|
|
—
|
|
|
—
|
|
||||
Fixed income securities:
|
|
|
|
|
|
|
|
||||||||
U. S. Treasury bonds
|
233
|
|
|
—
|
|
|
233
|
|
|
—
|
|
||||
Other Government bonds
|
41
|
|
|
—
|
|
|
41
|
|
|
—
|
|
||||
Agency backed bonds
|
31
|
|
|
—
|
|
|
31
|
|
|
—
|
|
||||
Corporate bonds
|
433
|
|
|
—
|
|
|
433
|
|
|
—
|
|
||||
Mortgage-backed securities
|
112
|
|
|
—
|
|
|
112
|
|
|
—
|
|
||||
Asset-backed securities
|
28
|
|
|
—
|
|
|
28
|
|
|
—
|
|
||||
Pooled funds
|
427
|
|
|
427
|
|
|
—
|
|
|
—
|
|
||||
Other types of investments:
|
|
|
|
|
|
|
|
||||||||
Real estate (a)
|
238
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Hedge funds (a)
|
179
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Private equity (a)
|
188
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Derivatives in a positive position
|
15
|
|
|
—
|
|
|
15
|
|
|
—
|
|
||||
Derivatives in a negative position
|
(22
|
)
|
|
—
|
|
|
(22
|
)
|
|
—
|
|
||||
Total
|
$
|
3,246
|
|
|
$
|
1,311
|
|
|
$
|
907
|
|
|
$
|
—
|
|
|
|
(millions)
|
||
Fiscal year
|
|
||
2017
|
$
|
383
|
|
2018
|
309
|
|
|
2019
|
299
|
|
|
2020
|
286
|
|
|
2021
|
246
|
|
|
2022-2026
|
1,113
|
|
|
|
2016
|
|
2015
|
||||
|
(millions)
|
||||||
Change in projected benefit obligation
|
|
|
|
||||
Projected benefit obligation, beginning of year
|
$
|
823
|
|
|
$
|
920
|
|
Service cost
|
—
|
|
|
—
|
|
||
Interest cost
|
22
|
|
|
31
|
|
||
Actuarial (gain) loss
|
26
|
|
|
(70
|
)
|
||
Benefits paid
|
(124
|
)
|
|
(58
|
)
|
||
Projected benefit obligation, end of year
|
747
|
|
|
823
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets, beginning of year
|
—
|
|
|
—
|
|
||
Company contributions
|
124
|
|
|
58
|
|
||
Benefits paid
|
(124
|
)
|
|
(58
|
)
|
||
Fair value of plan assets, end of year
|
—
|
|
|
—
|
|
||
Funded status at end of year
|
$
|
(747
|
)
|
|
$
|
(823
|
)
|
Amounts recognized in the Consolidated Balance Sheets at
January 28, 2017 and January 30, 2016 |
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
(86
|
)
|
|
$
|
(138
|
)
|
Other liabilities
|
(661
|
)
|
|
(685
|
)
|
||
|
$
|
(747
|
)
|
|
$
|
(823
|
)
|
Amounts recognized in accumulated other comprehensive loss at
January 28, 2017 and January 30, 2016 |
|
|
|
||||
Net actuarial loss
|
$
|
248
|
|
|
$
|
261
|
|
Prior service cost
|
8
|
|
|
8
|
|
||
|
$
|
256
|
|
|
$
|
269
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
Net Periodic Pension Cost
|
|
|
|
|
|
||||||
Service cost
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost
|
22
|
|
|
31
|
|
|
33
|
|
|||
Amortization of net actuarial loss
|
9
|
|
|
10
|
|
|
5
|
|
|||
Amortization of prior service credit
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
31
|
|
|
41
|
|
|
38
|
|
|||
|
|
|
|
|
|
||||||
Settlement charges
|
30
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
||||||
Other Changes in Plan Assets and Projected Benefit Obligation
Recognized in Other Comprehensive Loss |
|
|
|
|
|
||||||
Net actuarial (gain) loss
|
26
|
|
|
(70
|
)
|
|
170
|
|
|||
Prior service cost
|
—
|
|
|
—
|
|
|
—
|
|
|||
Amortization of net actuarial loss
|
(9
|
)
|
|
(10
|
)
|
|
(5
|
)
|
|||
Amortization of prior service credit
|
—
|
|
|
—
|
|
|
—
|
|
|||
Settlement charges
|
(30
|
)
|
|
—
|
|
|
—
|
|
|||
|
(13
|
)
|
|
(80
|
)
|
|
165
|
|
|||
Total recognized
|
$
|
48
|
|
|
$
|
(39
|
)
|
|
$
|
203
|
|
|
2016
|
|
2015
|
||
Discount rate
|
4.07
|
%
|
|
4.23
|
%
|
|
2016
|
|
2015
|
|
2014
|
||
Discount rate used to measure interest cost
|
2.65% - 3.16%
|
|
3.55
|
%
|
|
4.50
|
%
|
|
|
(millions)
|
||
Fiscal year
|
|
||
2017
|
$
|
86
|
|
2018
|
78
|
|
|
2019
|
46
|
|
|
2020
|
48
|
|
|
2021
|
48
|
|
|
2022-2026
|
228
|
|
10.
|
Postretirement Health Care and Life Insurance Benefits
|
|
|
2016
|
|
2015
|
||||
|
(millions)
|
||||||
Change in accumulated postretirement benefit obligation
|
|
|
|
||||
Accumulated postretirement benefit obligation, beginning of year
|
$
|
212
|
|
|
$
|
243
|
|
Service cost
|
—
|
|
|
—
|
|
||
Interest cost
|
6
|
|
|
8
|
|
||
Actuarial gain
|
(13
|
)
|
|
(22
|
)
|
||
Medicare Part D subsidy
|
1
|
|
|
1
|
|
||
Benefits paid
|
(20
|
)
|
|
(18
|
)
|
||
Accumulated postretirement benefit obligation, end of year
|
186
|
|
|
212
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets, beginning of year
|
—
|
|
|
—
|
|
||
Company contributions
|
20
|
|
|
18
|
|
||
Benefits paid
|
(20
|
)
|
|
(18
|
)
|
||
Fair value of plan assets, end of year
|
—
|
|
|
—
|
|
||
Funded status at end of year
|
$
|
(186
|
)
|
|
$
|
(212
|
)
|
Amounts recognized in the Consolidated Balance Sheets at
January 28, 2017 and January 30, 2016 |
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
(18
|
)
|
|
$
|
(20
|
)
|
Other liabilities
|
(168
|
)
|
|
(192
|
)
|
||
|
$
|
(186
|
)
|
|
$
|
(212
|
)
|
Amounts recognized in accumulated other comprehensive loss at
January 28, 2017 and January 30, 2016 |
|
|
|
||||
Net actuarial gain
|
$
|
(31
|
)
|
|
$
|
(22
|
)
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
Net Periodic Postretirement Benefit Cost
|
|
|
|
|
|
||||||
Service cost
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost
|
6
|
|
|
8
|
|
|
10
|
|
|||
Amortization of net actuarial gain
|
(4
|
)
|
|
—
|
|
|
(5
|
)
|
|||
Amortization of prior service cost
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
2
|
|
|
8
|
|
|
5
|
|
|||
Other Changes in Plan Assets and Projected Benefit Obligation
Recognized in Other Comprehensive Loss |
|
|
|
|
|
||||||
Net actuarial (gain) loss
|
(13
|
)
|
|
(22
|
)
|
|
30
|
|
|||
Amortization of net actuarial gain
|
4
|
|
|
—
|
|
|
5
|
|
|||
Amortization of prior service cost
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
(9
|
)
|
|
(22
|
)
|
|
35
|
|
|||
Total recognized
|
$
|
(7
|
)
|
|
$
|
(14
|
)
|
|
$
|
40
|
|
|
2016
|
|
2015
|
||
Discount rate
|
3.99
|
%
|
|
4.15
|
%
|
|
2016
|
|
2015
|
|
2014
|
|||
Discount rate used to measure interest cost
|
3.14
|
%
|
|
3.55
|
%
|
|
4.50
|
%
|
|
|
2016
|
|
2015
|
Health care cost trend rates assumed for next year
|
6.15% - 9.75%
|
|
6.25% - 10.0%
|
Rates to which the cost trend rate is assumed to decline (the ultimate trend rate)
|
5.0%
|
|
5.0%
|
Year that the rate reaches the ultimate trend rate
|
2027
|
|
2027
|
|
1 – Percentage
Point Increase
|
|
1 – Percentage
Point Decrease
|
||||
|
(millions)
|
||||||
Effect on total of service and interest cost
|
$
|
—
|
|
|
$
|
—
|
|
Effect on accumulated postretirement benefit obligations
|
$
|
11
|
|
|
$
|
(10
|
)
|
|
Expected
Benefit
Payments
|
|
Expected
Federal
Subsidy
|
||||
|
(millions)
|
||||||
Fiscal Year
|
|
|
|
||||
2017
|
$
|
17
|
|
|
$
|
1
|
|
2018
|
17
|
|
|
1
|
|
||
2019
|
16
|
|
|
1
|
|
||
2020
|
16
|
|
|
—
|
|
||
2021
|
15
|
|
|
—
|
|
||
2022-2026
|
63
|
|
|
1
|
|
|
11.
|
Stock Based Compensation
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
Stock options
|
$
|
43
|
|
|
$
|
52
|
|
|
$
|
47
|
|
Restricted stock units
|
18
|
|
|
13
|
|
|
26
|
|
|||
|
$
|
61
|
|
|
$
|
65
|
|
|
$
|
73
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Weighted average grant date fair value of stock options
granted during the period |
$
|
12.14
|
|
|
$
|
20.78
|
|
|
$
|
19.07
|
|
Dividend yield
|
3.8
|
%
|
|
2.7
|
%
|
|
2.5
|
%
|
|||
Expected volatility
|
42.7
|
%
|
|
43.3
|
%
|
|
42.7
|
%
|
|||
Risk-free interest rate
|
1.4
|
%
|
|
1.7
|
%
|
|
1.5
|
%
|
|||
Expected life
|
5.7 years
|
|
|
5.7 years
|
|
|
5.7 years
|
|
|
Shares
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Life
|
|
Aggregate
Intrinsic
Value
|
|||||
|
(thousands)
|
|
|
|
(years)
|
|
(millions)
|
|||||
Outstanding, beginning of period
|
18,829.8
|
|
|
$
|
41.92
|
|
|
|
|
|
||
Granted
|
3,886.8
|
|
|
$
|
42.97
|
|
|
|
|
|
||
Canceled or forfeited
|
(1,116.6
|
)
|
|
$
|
51.33
|
|
|
|
|
|
||
Exercised
|
(1,122.1
|
)
|
|
$
|
31.30
|
|
|
|
|
|
||
Outstanding, end of period
|
20,477.9
|
|
|
$
|
42.18
|
|
|
|
|
|
||
Exercisable, end of period
|
12,541.5
|
|
|
$
|
36.48
|
|
|
4.1
|
|
$
|
46
|
|
Options expected to vest
|
6,657.5
|
|
|
$
|
51.07
|
|
|
8.3
|
|
$
|
—
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(millions)
|
||||||||||
Intrinsic value of options exercised
|
$
|
12
|
|
|
$
|
127
|
|
|
$
|
189
|
|
Cash received from stock options exercised
|
35
|
|
|
125
|
|
|
200
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Restricted stock units
|
$
|
40.02
|
|
|
$
|
62.61
|
|
|
$
|
59.41
|
|
|
Shares
|
|
Weighted
Average
Grant Date
Fair Value
|
|||
|
(thousands)
|
|
|
|||
Nonvested, beginning of period
|
1,497.0
|
|
|
$
|
57.06
|
|
Granted – performance-based
|
575.1
|
|
|
43.72
|
|
|
Performance adjustment
|
(237.6
|
)
|
|
59.82
|
|
|
Granted – time-based
|
482.8
|
|
|
35.61
|
|
|
Forfeited
|
(250.0
|
)
|
|
32.99
|
|
|
Vested
|
(249.0
|
)
|
|
33.70
|
|
|
Nonvested, end of period
|
1,818.3
|
|
|
$
|
53.29
|
|
|
12.
|
Shareholders’ Equity
|
|
|
|
|
Treasury Stock
|
|
|
|||||||||
|
Common
Stock
Issued
|
|
Deferred
Compensation
Plans
|
|
Other
|
|
Total
|
|
Common
Stock
Outstanding
|
|||||
|
|
|
|
|
(thousands)
|
|
|
|
|
|||||
Balance at February 1, 2014
|
410,605.8
|
|
|
(1,229.2
|
)
|
|
(44,441.6
|
)
|
|
(45,670.8
|
)
|
|
364,935.0
|
|
Stock issued under stock plans
|
|
|
(54.8
|
)
|
|
7,490.6
|
|
|
7,435.8
|
|
|
7,435.8
|
|
|
Stock repurchases
|
|
|
|
|
|
|
|
|
|
|||||
Repurchase program
|
|
|
|
|
(31,874.9
|
)
|
|
(31,874.9
|
)
|
|
(31,874.9
|
)
|
||
Other
|
|
|
|
|
(27.0
|
)
|
|
(27.0
|
)
|
|
(27.0
|
)
|
||
Deferred compensation plan distributions
|
|
|
104.8
|
|
|
|
|
104.8
|
|
|
104.8
|
|
||
Retirement of common stock
|
(31,000.0
|
)
|
|
|
|
31,000.0
|
|
|
31,000.0
|
|
|
—
|
|
|
Balance at January 31, 2015
|
379,605.8
|
|
|
(1,179.2
|
)
|
|
(37,852.9
|
)
|
|
(39,032.1
|
)
|
|
340,573.7
|
|
Stock issued under stock plans
|
|
|
(60.4
|
)
|
|
4,493.5
|
|
|
4,433.1
|
|
|
4,433.1
|
|
|
Stock repurchases
|
|
|
|
|
|
|
|
|
|
|||||
Repurchase program
|
|
|
|
|
(34,806.8
|
)
|
|
(34,806.8
|
)
|
|
(34,806.8
|
)
|
||
Other
|
|
|
|
|
(12.7
|
)
|
|
(12.7
|
)
|
|
(12.7
|
)
|
||
Deferred compensation plan distributions
|
|
|
68.8
|
|
|
|
|
68.8
|
|
|
68.8
|
|
||
Retirement of common stock
|
(38,000.0
|
)
|
|
|
|
38,000.0
|
|
|
38,000.0
|
|
|
—
|
|
|
Balance at January 30, 2016
|
341,605.8
|
|
|
(1,170.8
|
)
|
|
(30,178.9
|
)
|
|
(31,349.7
|
)
|
|
310,256.1
|
|
Stock issued under stock plans
|
|
|
(87.0
|
)
|
|
1,611.7
|
|
|
1,524.7
|
|
|
1,524.7
|
|
|
Stock repurchases
|
|
|
|
|
|
|
|
|
|
|||||
Repurchase program
|
|
|
|
|
(7,874.3
|
)
|
|
(7,874.3
|
)
|
|
(7,874.3
|
)
|
||
Other
|
|
|
|
|
(4.6
|
)
|
|
(4.6
|
)
|
|
(4.6
|
)
|
||
Deferred compensation plan distributions
|
|
|
160.9
|
|
|
|
|
160.9
|
|
|
160.9
|
|
||
Retirement of common stock
|
(8,000.0
|
)
|
|
|
|
8,000.0
|
|
|
8,000.0
|
|
|
—
|
|
|
Balance at January 28, 2017
|
333,605.8
|
|
|
(1,096.9
|
)
|
|
(28,446.1
|
)
|
|
(29,543.0
|
)
|
|
304,062.8
|
|
|
13.
|
Fair Value Measurements and Concentrations of Credit Risk
|
|
January 28, 2017
|
|
January 30, 2016
|
||||||||||||||||||||||||||||
|
|
|
Fair Value Measurements
|
|
|
|
Fair Value Measurements
|
||||||||||||||||||||||||
|
Total
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||||||||||
|
(millions)
|
||||||||||||||||||||||||||||||
Marketable
equity and debt securities |
$
|
112
|
|
|
$
|
20
|
|
|
$
|
92
|
|
|
$
|
—
|
|
|
$
|
132
|
|
|
$
|
13
|
|
|
$
|
119
|
|
|
$
|
—
|
|
|
January 28, 2017
|
|
January 30, 2016
|
||||||||||||||||||||
|
Notional
Amount
|
|
Carrying
Amount
|
|
Fair
Value
|
|
Notional
Amount
|
|
Carrying
Amount
|
|
Fair
Value
|
||||||||||||
|
(millions)
|
||||||||||||||||||||||
Long-term debt
|
$
|
6,459
|
|
|
$
|
6,535
|
|
|
$
|
6,438
|
|
|
$
|
6,871
|
|
|
$
|
6,966
|
|
|
$
|
6,756
|
|
|
January 28, 2017
|
|
January 30, 2016
|
||||||||||||||||||||||||||||
|
|
|
Fair Value Measurements
|
|
|
|
Fair Value Measurements
|
||||||||||||||||||||||||
|
Total
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||||||||||
|
(millions)
|
||||||||||||||||||||||||||||||
Long-lived assets held and used
|
$
|
147
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
147
|
|
|
$
|
53
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
53
|
|
|
14.
|
Earnings Per Share Attributable to Macy's, Inc. Shareholders
|
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||||||||||||||
|
Net
Income
|
|
|
|
Shares
|
|
Net
Income
|
|
|
|
Shares
|
|
Net Income
|
|
|
|
Shares
|
|||||||||||||||
|
(millions, except per share data)
|
|||||||||||||||||||||||||||||||
Net income attributable to Macy's, Inc. shareholders
and average number of shares outstanding
|
$
|
619
|
|
|
|
|
307.6
|
|
|
$
|
1,072
|
|
|
|
|
327.6
|
|
|
$
|
1,526
|
|
|
|
|
354.3
|
|
||||||
Shares to be issued under deferred compensation
and other plans |
|
|
|
|
0.9
|
|
|
|
|
|
|
0.8
|
|
|
|
|
|
|
0.9
|
|
||||||||||||
|
$
|
619
|
|
|
|
|
308.5
|
|
|
$
|
1,072
|
|
|
|
|
328.4
|
|
|
$
|
1,526
|
|
|
|
|
355.2
|
|
||||||
Basic earnings per share attributable to Macy's, Inc. shareholders
|
|
|
$
|
2.01
|
|
|
|
|
|
|
$
|
3.26
|
|
|
|
|
|
|
$
|
4.30
|
|
|
|
|||||||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Stock options, restricted stock and restricted
stock units |
|
|
|
|
2.3
|
|
|
|
|
|
|
4.6
|
|
|
|
|
|
|
6.5
|
|
||||||||||||
|
$
|
619
|
|
|
|
|
310.8
|
|
|
$
|
1,072
|
|
|
|
|
333.0
|
|
|
$
|
1,526
|
|
|
|
|
361.7
|
|
||||||
Diluted earnings per share attributable to Macy's, Inc. shareholders
|
|
|
$
|
1.99
|
|
|
|
|
|
|
$
|
3.22
|
|
|
|
|
|
|
$
|
4.22
|
|
|
|
|
15.
|
Quarterly Results (unaudited)
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
|
(millions, except per share data)
|
||||||||||||||
2016:
|
|
|
|
|
|
|
|
||||||||
Net sales
|
$
|
5,771
|
|
|
$
|
5,866
|
|
|
$
|
5,626
|
|
|
$
|
8,515
|
|
Cost of sales
|
(3,516
|
)
|
|
(3,468
|
)
|
|
(3,386
|
)
|
|
(5,251
|
)
|
||||
Gross margin
|
2,255
|
|
|
2,398
|
|
|
2,240
|
|
|
3,264
|
|
||||
Selling, general and administrative expenses
|
(1,966
|
)
|
|
(2,026
|
)
|
|
(2,071
|
)
|
|
(2,202
|
)
|
||||
Impairments, store closing and other costs
|
—
|
|
|
(249
|
)
|
|
—
|
|
|
(230
|
)
|
||||
Settlement charges
|
(13
|
)
|
|
(6
|
)
|
|
(62
|
)
|
|
(17
|
)
|
||||
Net income attributable to Macy's, Inc. shareholders
|
116
|
|
|
11
|
|
|
17
|
|
|
475
|
|
||||
Basic earnings per share attributable to
Macy's, Inc. shareholders
|
.37
|
|
|
.03
|
|
|
.05
|
|
|
1.56
|
|
||||
Diluted earnings per share attributable to
Macy's, Inc. shareholders
|
.37
|
|
|
.03
|
|
|
.05
|
|
|
1.54
|
|
||||
2015:
|
|
|
|
|
|
|
|
||||||||
Net sales
|
$
|
6,232
|
|
|
$
|
6,104
|
|
|
$
|
5,874
|
|
|
$
|
8,869
|
|
Cost of sales
|
(3,800
|
)
|
|
(3,610
|
)
|
|
(3,537
|
)
|
|
(5,549
|
)
|
||||
Gross margin
|
2,432
|
|
|
2,494
|
|
|
2,337
|
|
|
3,320
|
|
||||
Selling, general and administrative expenses
|
(2,023
|
)
|
|
(2,058
|
)
|
|
(1,968
|
)
|
|
(2,207
|
)
|
||||
Impairments, store closing and other costs
|
—
|
|
|
—
|
|
|
(111
|
)
|
|
(177
|
)
|
||||
Net income attributable to Macy's, Inc. shareholders
|
193
|
|
|
217
|
|
|
118
|
|
|
544
|
|
||||
Basic earnings per share attributable to
Macy's, Inc. shareholders |
.57
|
|
|
.65
|
|
|
.36
|
|
|
1.74
|
|
||||
Diluted earnings per share attributable to
Macy's, Inc. shareholders |
.56
|
|
|
.64
|
|
|
.36
|
|
|
1.73
|
|
16.
|
Condensed Consolidating Financial Information
|
|
|
Parent
|
|
Subsidiary
Issuer
|
|
Other
Subsidiaries
|
|
Consolidating
Adjustments
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
10,677
|
|
|
$
|
23,436
|
|
|
$
|
(8,335
|
)
|
|
$
|
25,778
|
|
Cost of sales
|
—
|
|
|
(6,787
|
)
|
|
(17,169
|
)
|
|
8,335
|
|
|
(15,621
|
)
|
|||||
Gross margin
|
—
|
|
|
3,890
|
|
|
6,267
|
|
|
—
|
|
|
10,157
|
|
|||||
Selling, general and administrative expenses
|
(2
|
)
|
|
(3,739
|
)
|
|
(4,524
|
)
|
|
—
|
|
|
(8,265
|
)
|
|||||
Impairments, store closing and other costs
|
—
|
|
|
(295
|
)
|
|
(184
|
)
|
|
—
|
|
|
(479
|
)
|
|||||
Settlement charges
|
—
|
|
|
(34
|
)
|
|
(64
|
)
|
|
—
|
|
|
(98
|
)
|
|||||
Operating income (loss)
|
(2
|
)
|
|
(178
|
)
|
|
1,495
|
|
|
—
|
|
|
1,315
|
|
|||||
Interest (expense) income, net:
|
|
|
|
|
|
|
|
|
|
||||||||||
External
|
2
|
|
|
(366
|
)
|
|
1
|
|
|
—
|
|
|
(363
|
)
|
|||||
Intercompany
|
—
|
|
|
(200
|
)
|
|
200
|
|
|
—
|
|
|
—
|
|
|||||
Equity in earnings of subsidiaries
|
619
|
|
|
255
|
|
|
—
|
|
|
(874
|
)
|
|
—
|
|
|||||
Income (loss) before income taxes
|
619
|
|
|
(489
|
)
|
|
1,696
|
|
|
(874
|
)
|
|
952
|
|
|||||
Federal, state and local income
tax benefit (expense) |
—
|
|
|
281
|
|
|
(622
|
)
|
|
—
|
|
|
(341
|
)
|
|||||
Net income (loss)
|
619
|
|
|
(208
|
)
|
|
1,074
|
|
|
(874
|
)
|
|
611
|
|
|||||
Net loss attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
|||||
Net income (loss) attributable to
Macy's, Inc. shareholders
|
$
|
619
|
|
|
$
|
(208
|
)
|
|
$
|
1,082
|
|
|
$
|
(874
|
)
|
|
$
|
619
|
|
Comprehensive income (loss)
|
$
|
766
|
|
|
$
|
(61
|
)
|
|
$
|
1,153
|
|
|
$
|
(1,100
|
)
|
|
$
|
758
|
|
Comprehensive loss attributable to
noncontrolling interest
|
—
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
|||||
Comprehensive income (loss) attributable to
Macy's, Inc. shareholders
|
$
|
766
|
|
|
$
|
(61
|
)
|
|
$
|
1,161
|
|
|
$
|
(1,100
|
)
|
|
$
|
766
|
|
|
|
Parent
|
|
Subsidiary
Issuer
|
|
Other
Subsidiaries
|
|
Consolidating
Adjustments
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
11,959
|
|
|
$
|
24,037
|
|
|
$
|
(8,917
|
)
|
|
$
|
27,079
|
|
Cost of sales
|
—
|
|
|
(7,670
|
)
|
|
(17,743
|
)
|
|
8,917
|
|
|
(16,496
|
)
|
|||||
Gross margin
|
—
|
|
|
4,289
|
|
|
6,294
|
|
|
—
|
|
|
10,583
|
|
|||||
Selling, general and administrative expenses
|
(2
|
)
|
|
(3,980
|
)
|
|
(4,274
|
)
|
|
—
|
|
|
(8,256
|
)
|
|||||
Impairments, store closing and other costs
|
—
|
|
|
(170
|
)
|
|
(118
|
)
|
|
—
|
|
|
(288
|
)
|
|||||
Operating income (loss)
|
(2
|
)
|
|
139
|
|
|
1,902
|
|
|
—
|
|
|
2,039
|
|
|||||
Interest (expense) income, net:
|
|
|
|
|
|
|
|
|
|
||||||||||
External
|
1
|
|
|
(361
|
)
|
|
(1
|
)
|
|
—
|
|
|
(361
|
)
|
|||||
Intercompany
|
—
|
|
|
(230
|
)
|
|
230
|
|
|
—
|
|
|
—
|
|
|||||
Equity in earnings of subsidiaries
|
1,072
|
|
|
421
|
|
|
—
|
|
|
(1,493
|
)
|
|
—
|
|
|||||
Income (loss) before income taxes
|
1,071
|
|
|
(31
|
)
|
|
2,131
|
|
|
(1,493
|
)
|
|
1,678
|
|
|||||
Federal, state and local income
tax benefit (expense) |
1
|
|
|
120
|
|
|
(729
|
)
|
|
—
|
|
|
(608
|
)
|
|||||
Net income
|
1,072
|
|
|
89
|
|
|
1,402
|
|
|
(1,493
|
)
|
|
1,070
|
|
|||||
Net loss attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||
Net income attributable to
Macy's, Inc. shareholders |
$
|
1,072
|
|
|
$
|
89
|
|
|
$
|
1,404
|
|
|
$
|
(1,493
|
)
|
|
$
|
1,072
|
|
Comprehensive income
|
$
|
1,101
|
|
|
$
|
118
|
|
|
$
|
1,415
|
|
|
$
|
(1,535
|
)
|
|
$
|
1,099
|
|
Comprehensive loss attributable to
noncontrolling interest |
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||
Comprehensive income attributable to
Macy's, Inc. shareholders |
$
|
1,101
|
|
|
$
|
118
|
|
|
$
|
1,417
|
|
|
$
|
(1,535
|
)
|
|
$
|
1,101
|
|
|
|
Parent
|
|
Subsidiary
Issuer
|
|
Other
Subsidiaries
|
|
Consolidating
Adjustments
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
13,078
|
|
|
$
|
23,522
|
|
|
$
|
(8,495
|
)
|
|
$
|
28,105
|
|
Cost of sales
|
—
|
|
|
(8,127
|
)
|
|
(17,231
|
)
|
|
8,495
|
|
|
(16,863
|
)
|
|||||
Gross margin
|
—
|
|
|
4,951
|
|
|
6,291
|
|
|
—
|
|
|
11,242
|
|
|||||
Selling, general and administrative expenses
|
(3
|
)
|
|
(4,351
|
)
|
|
(4,001
|
)
|
|
—
|
|
|
(8,355
|
)
|
|||||
Impairments, store closing and other costs
|
—
|
|
|
(45
|
)
|
|
(42
|
)
|
|
—
|
|
|
(87
|
)
|
|||||
Operating income (loss)
|
(3
|
)
|
|
555
|
|
|
2,248
|
|
|
—
|
|
|
2,800
|
|
|||||
Interest (expense) income, net:
|
|
|
|
|
|
|
|
|
|
||||||||||
External
|
1
|
|
|
(394
|
)
|
|
—
|
|
|
—
|
|
|
(393
|
)
|
|||||
Intercompany
|
—
|
|
|
(230
|
)
|
|
230
|
|
|
—
|
|
|
—
|
|
|||||
Premium on early retirement of debt
|
—
|
|
|
(17
|
)
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
|||||
Equity in earnings of subsidiaries
|
1,528
|
|
|
624
|
|
|
—
|
|
|
(2,152
|
)
|
|
—
|
|
|||||
Income before income taxes
|
1,526
|
|
|
538
|
|
|
2,478
|
|
|
(2,152
|
)
|
|
2,390
|
|
|||||
Federal, state and local income
tax benefit (expense) |
—
|
|
|
25
|
|
|
(889
|
)
|
|
—
|
|
|
(864
|
)
|
|||||
Net income
|
1,526
|
|
|
563
|
|
|
1,589
|
|
|
(2,152
|
)
|
|
1,526
|
|
|||||
Net loss attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income attributable to
Macy's, Inc. shareholders |
$
|
1,526
|
|
|
$
|
563
|
|
|
$
|
1,589
|
|
|
$
|
(2,152
|
)
|
|
$
|
1,526
|
|
Comprehensive income
|
$
|
1,119
|
|
|
$
|
156
|
|
|
$
|
1,338
|
|
|
$
|
(1,494
|
)
|
|
$
|
1,119
|
|
Comprehensive loss attributable to
noncontrolling interest |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Comprehensive income attributable to
Macy's, Inc. shareholders |
$
|
1,119
|
|
|
$
|
156
|
|
|
$
|
1,338
|
|
|
$
|
(1,494
|
)
|
|
$
|
1,119
|
|
|
|
Parent
|
|
Subsidiary
Issuer
|
|
Other
Subsidiaries
|
|
Consolidating
Adjustments
|
|
Consolidated
|
||||||||||
ASSETS:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
938
|
|
|
$
|
81
|
|
|
$
|
278
|
|
|
$
|
—
|
|
|
$
|
1,297
|
|
Receivables
|
—
|
|
|
169
|
|
|
353
|
|
|
—
|
|
|
522
|
|
|||||
Merchandise inventories
|
—
|
|
|
2,565
|
|
|
2,834
|
|
|
—
|
|
|
5,399
|
|
|||||
Prepaid expenses and other current assets
|
—
|
|
|
84
|
|
|
324
|
|
|
—
|
|
|
408
|
|
|||||
Total Current Assets
|
938
|
|
|
2,899
|
|
|
3,789
|
|
|
—
|
|
|
7,626
|
|
|||||
Property and Equipment – net
|
—
|
|
|
3,397
|
|
|
3,620
|
|
|
—
|
|
|
7,017
|
|
|||||
Goodwill
|
—
|
|
|
3,315
|
|
|
582
|
|
|
—
|
|
|
3,897
|
|
|||||
Other Intangible Assets – net
|
—
|
|
|
51
|
|
|
447
|
|
|
—
|
|
|
498
|
|
|||||
Other Assets
|
—
|
|
|
47
|
|
|
766
|
|
|
—
|
|
|
813
|
|
|||||
Deferred Income Taxes
|
26
|
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
—
|
|
|||||
Intercompany Receivable
|
375
|
|
|
—
|
|
|
2,428
|
|
|
(2,803
|
)
|
|
—
|
|
|||||
Investment in Subsidiaries
|
3,137
|
|
|
3,540
|
|
|
—
|
|
|
(6,677
|
)
|
|
—
|
|
|||||
Total Assets
|
$
|
4,476
|
|
|
$
|
13,249
|
|
|
$
|
11,632
|
|
|
$
|
(9,506
|
)
|
|
$
|
19,851
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term debt
|
$
|
—
|
|
|
$
|
306
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
309
|
|
Merchandise accounts payable
|
—
|
|
|
590
|
|
|
833
|
|
|
—
|
|
|
1,423
|
|
|||||
Accounts payable and accrued liabilities
|
15
|
|
|
1,064
|
|
|
2,484
|
|
|
—
|
|
|
3,563
|
|
|||||
Income taxes
|
71
|
|
|
16
|
|
|
265
|
|
|
—
|
|
|
352
|
|
|||||
Total Current Liabilities
|
86
|
|
|
1,976
|
|
|
3,585
|
|
|
—
|
|
|
5,647
|
|
|||||
Long-Term Debt
|
—
|
|
|
6,544
|
|
|
18
|
|
|
—
|
|
|
6,562
|
|
|||||
Intercompany Payable
|
—
|
|
|
2,803
|
|
|
—
|
|
|
(2,803
|
)
|
|
—
|
|
|||||
Deferred Income Taxes
|
—
|
|
|
688
|
|
|
781
|
|
|
(26
|
)
|
|
1,443
|
|
|||||
Other Liabilities
|
66
|
|
|
500
|
|
|
1,311
|
|
|
—
|
|
|
1,877
|
|
|||||
Shareholders’ Equity:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Macy's, Inc.
|
4,323
|
|
|
738
|
|
|
5,939
|
|
|
(6,677
|
)
|
|
4,323
|
|
|||||
Noncontrolling Interest
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||
Total Shareholders’ Equity
|
4,323
|
|
|
738
|
|
|
5,938
|
|
|
(6,677
|
)
|
|
4,322
|
|
|||||
Total Liabilities and Shareholders’ Equity
|
$
|
4,475
|
|
|
$
|
13,249
|
|
|
$
|
11,633
|
|
|
$
|
(9,506
|
)
|
|
$
|
19,851
|
|
|
|
Parent
|
|
Subsidiary
Issuer
|
|
Other
Subsidiaries
|
|
Consolidating
Adjustments
|
|
Consolidated
|
||||||||||
ASSETS:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
741
|
|
|
$
|
91
|
|
|
$
|
277
|
|
|
$
|
—
|
|
|
$
|
1,109
|
|
Receivables
|
—
|
|
|
217
|
|
|
341
|
|
|
—
|
|
|
558
|
|
|||||
Merchandise inventories
|
—
|
|
|
2,702
|
|
|
2,804
|
|
|
—
|
|
|
5,506
|
|
|||||
Prepaid expenses and other current assets
|
—
|
|
|
135
|
|
|
344
|
|
|
—
|
|
|
479
|
|
|||||
Income taxes
|
44
|
|
|
—
|
|
|
—
|
|
|
(44
|
)
|
|
—
|
|
|||||
Total Current Assets
|
785
|
|
|
3,145
|
|
|
3,766
|
|
|
(44
|
)
|
|
7,652
|
|
|||||
Property and Equipment – net
|
—
|
|
|
3,925
|
|
|
3,691
|
|
|
—
|
|
|
7,616
|
|
|||||
Goodwill
|
—
|
|
|
3,315
|
|
|
582
|
|
|
—
|
|
|
3,897
|
|
|||||
Other Intangible Assets – net
|
—
|
|
|
52
|
|
|
462
|
|
|
—
|
|
|
514
|
|
|||||
Other Assets
|
—
|
|
|
154
|
|
|
743
|
|
|
—
|
|
|
897
|
|
|||||
Deferred Income Taxes
|
14
|
|
|
—
|
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|||||
Intercompany Receivable
|
—
|
|
|
—
|
|
|
3,800
|
|
|
(3,800
|
)
|
|
—
|
|
|||||
Investment in Subsidiaries
|
4,725
|
|
|
3,804
|
|
|
—
|
|
|
(8,529
|
)
|
|
—
|
|
|||||
Total Assets
|
$
|
5,524
|
|
|
$
|
14,395
|
|
|
$
|
13,044
|
|
|
$
|
(12,387
|
)
|
|
$
|
20,576
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term debt
|
$
|
—
|
|
|
$
|
641
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
642
|
|
Merchandise accounts payable
|
—
|
|
|
667
|
|
|
859
|
|
|
—
|
|
|
1,526
|
|
|||||
Accounts payable and accrued liabilities
|
35
|
|
|
1,439
|
|
|
1,859
|
|
|
—
|
|
|
3,333
|
|
|||||
Income taxes
|
—
|
|
|
41
|
|
|
230
|
|
|
(44
|
)
|
|
227
|
|
|||||
Total Current Liabilities
|
35
|
|
|
2,788
|
|
|
2,949
|
|
|
(44
|
)
|
|
5,728
|
|
|||||
Long-Term Debt
|
—
|
|
|
6,976
|
|
|
19
|
|
|
—
|
|
|
6,995
|
|
|||||
Intercompany Payable
|
1,218
|
|
|
2,582
|
|
|
—
|
|
|
(3,800
|
)
|
|
—
|
|
|||||
Deferred Income Taxes
|
—
|
|
|
693
|
|
|
798
|
|
|
(14
|
)
|
|
1,477
|
|
|||||
Other Liabilities
|
21
|
|
|
558
|
|
|
1,544
|
|
|
—
|
|
|
2,123
|
|
|||||
Shareholders’ Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Macy's, Inc.
|
4,250
|
|
|
798
|
|
|
7,731
|
|
|
(8,529
|
)
|
|
4,250
|
|
|||||
Noncontrolling Interest
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
|||||
Total Shareholders’ Equity
|
4,250
|
|
|
798
|
|
|
7,734
|
|
|
(8,529
|
)
|
|
4,253
|
|
|||||
Total Liabilities and Shareholders’ Equity
|
$
|
5,524
|
|
|
$
|
14,395
|
|
|
$
|
13,044
|
|
|
$
|
(12,387
|
)
|
|
$
|
20,576
|
|
|
|
Parent
|
|
Subsidiary
Issuer
|
|
Other
Subsidiaries
|
|
Consolidating
Adjustments
|
|
Consolidated
|
||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss)
|
$
|
619
|
|
|
$
|
(208
|
)
|
|
$
|
1,074
|
|
|
$
|
(874
|
)
|
|
$
|
611
|
|
Impairments, store closing and other costs
|
—
|
|
|
295
|
|
|
184
|
|
|
—
|
|
|
479
|
|
|||||
Settlement charges
|
—
|
|
|
34
|
|
|
64
|
|
|
—
|
|
|
98
|
|
|||||
Equity in earnings of subsidiaries
|
(619
|
)
|
|
(255
|
)
|
|
—
|
|
|
874
|
|
|
—
|
|
|||||
Dividends received from subsidiaries
|
957
|
|
|
575
|
|
|
—
|
|
|
(1,532
|
)
|
|
—
|
|
|||||
Depreciation and amortization
|
—
|
|
|
407
|
|
|
651
|
|
|
—
|
|
|
1,058
|
|
|||||
(Increase) decrease in working capital
|
110
|
|
|
(482
|
)
|
|
92
|
|
|
—
|
|
|
(280
|
)
|
|||||
Other, net
|
28
|
|
|
51
|
|
|
(244
|
)
|
|
—
|
|
|
(165
|
)
|
|||||
Net cash provided by
operating activities |
1,095
|
|
|
417
|
|
|
1,821
|
|
|
(1,532
|
)
|
|
1,801
|
|
|||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Purchase of property and equipment and capitalized software, net
|
—
|
|
|
12
|
|
|
(251
|
)
|
|
—
|
|
|
(239
|
)
|
|||||
Other, net
|
—
|
|
|
32
|
|
|
20
|
|
|
—
|
|
|
52
|
|
|||||
Net cash provided (used) by investing activities
|
—
|
|
|
44
|
|
|
(231
|
)
|
|
—
|
|
|
(187
|
)
|
|||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt repaid, net of debt issued
|
—
|
|
|
(750
|
)
|
|
1
|
|
|
—
|
|
|
(749
|
)
|
|||||
Dividends paid
|
(459
|
)
|
|
—
|
|
|
(1,532
|
)
|
|
1,532
|
|
|
(459
|
)
|
|||||
Common stock acquired, net of
issuance of common stock |
(280
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(280
|
)
|
|||||
Proceeds from noncontrolling interest
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
|||||
Intercompany activity, net
|
(144
|
)
|
|
255
|
|
|
(111
|
)
|
|
—
|
|
|
—
|
|
|||||
Other, net
|
(15
|
)
|
|
24
|
|
|
49
|
|
|
—
|
|
|
58
|
|
|||||
Net cash used by
financing activities |
(898
|
)
|
|
(471
|
)
|
|
(1,589
|
)
|
|
1,532
|
|
|
(1,426
|
)
|
|||||
Net increase (decrease) in cash
and cash equivalents |
197
|
|
|
(10
|
)
|
|
1
|
|
|
—
|
|
|
188
|
|
|||||
Cash and cash equivalents at
beginning of period |
741
|
|
|
91
|
|
|
277
|
|
|
—
|
|
|
1,109
|
|
|||||
Cash and cash equivalents at
end of period |
$
|
938
|
|
|
$
|
81
|
|
|
$
|
278
|
|
|
$
|
—
|
|
|
$
|
1,297
|
|
|
|
Parent
|
|
Subsidiary
Issuer
|
|
Other
Subsidiaries
|
|
Consolidating
Adjustments
|
|
Consolidated
|
||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
$
|
1,072
|
|
|
$
|
89
|
|
|
$
|
1,402
|
|
|
$
|
(1,493
|
)
|
|
$
|
1,070
|
|
Impairments, store closing and other costs
|
—
|
|
|
170
|
|
|
118
|
|
|
—
|
|
|
288
|
|
|||||
Equity in earnings of subsidiaries
|
(1,072
|
)
|
|
(421
|
)
|
|
—
|
|
|
1,493
|
|
|
—
|
|
|||||
Dividends received from subsidiaries
|
1,086
|
|
|
—
|
|
|
—
|
|
|
(1,086
|
)
|
|
—
|
|
|||||
Depreciation and amortization
|
—
|
|
|
440
|
|
|
621
|
|
|
—
|
|
|
1,061
|
|
|||||
(Increase) decrease in working capital
|
25
|
|
|
(340
|
)
|
|
(81
|
)
|
|
—
|
|
|
(396
|
)
|
|||||
Other, net
|
(8
|
)
|
|
(78
|
)
|
|
47
|
|
|
—
|
|
|
(39
|
)
|
|||||
Net cash provided (used) by
operating activities |
1,103
|
|
|
(140
|
)
|
|
2,107
|
|
|
(1,086
|
)
|
|
1,984
|
|
|||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Purchase of property and equipment and capitalized software, net
|
—
|
|
|
(88
|
)
|
|
(821
|
)
|
|
—
|
|
|
(909
|
)
|
|||||
Other, net
|
—
|
|
|
83
|
|
|
(266
|
)
|
|
—
|
|
|
(183
|
)
|
|||||
Net cash used by
investing activities |
—
|
|
|
(5
|
)
|
|
(1,087
|
)
|
|
—
|
|
|
(1,092
|
)
|
|||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt issued, net of debt repaid
|
—
|
|
|
348
|
|
|
(1
|
)
|
|
—
|
|
|
347
|
|
|||||
Dividends paid
|
(456
|
)
|
|
—
|
|
|
(1,086
|
)
|
|
1,086
|
|
|
(456
|
)
|
|||||
Common stock acquired, net of
issuance of common stock |
(1,838
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,838
|
)
|
|||||
Proceeds from noncontrolling interest
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
|||||
Intercompany activity, net
|
12
|
|
|
(243
|
)
|
|
231
|
|
|
—
|
|
|
—
|
|
|||||
Other, net
|
12
|
|
|
37
|
|
|
(136
|
)
|
|
—
|
|
|
(87
|
)
|
|||||
Net cash provided (used) by financing activities
|
(2,270
|
)
|
|
142
|
|
|
(987
|
)
|
|
1,086
|
|
|
(2,029
|
)
|
|||||
Net increase (decrease) in
cash and cash equivalents |
(1,167
|
)
|
|
(3
|
)
|
|
33
|
|
|
—
|
|
|
(1,137
|
)
|
|||||
Cash and cash equivalents at
beginning of period |
1,908
|
|
|
94
|
|
|
244
|
|
|
—
|
|
|
2,246
|
|
|||||
Cash and cash equivalents at
end of period |
$
|
741
|
|
|
$
|
91
|
|
|
$
|
277
|
|
|
$
|
—
|
|
|
$
|
1,109
|
|
|
|
Parent
|
|
Subsidiary
Issuer
|
|
Other
Subsidiaries
|
|
Consolidating
Adjustments
|
|
Consolidated
|
||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
$
|
1,526
|
|
|
$
|
563
|
|
|
$
|
1,589
|
|
|
$
|
(2,152
|
)
|
|
$
|
1,526
|
|
Impairments, store closing and other costs
|
—
|
|
|
45
|
|
|
42
|
|
|
—
|
|
|
87
|
|
|||||
Equity in earnings of subsidiaries
|
(1,528
|
)
|
|
(624
|
)
|
|
—
|
|
|
2,152
|
|
|
—
|
|
|||||
Dividends received from subsidiaries
|
1,088
|
|
|
1
|
|
|
—
|
|
|
(1,089
|
)
|
|
—
|
|
|||||
Depreciation and amortization
|
—
|
|
|
454
|
|
|
582
|
|
|
—
|
|
|
1,036
|
|
|||||
Increase (decrease) in working capital
|
9
|
|
|
74
|
|
|
(69
|
)
|
|
—
|
|
|
14
|
|
|||||
Other, net
|
(20
|
)
|
|
(177
|
)
|
|
243
|
|
|
—
|
|
|
46
|
|
|||||
Net cash provided by
operating activities |
1,075
|
|
|
336
|
|
|
2,387
|
|
|
(1,089
|
)
|
|
2,709
|
|
|||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Purchase (disposition) of property and equipment and capitalized software, net
|
—
|
|
|
(260
|
)
|
|
(636
|
)
|
|
—
|
|
|
(896
|
)
|
|||||
Other, net
|
—
|
|
|
(12
|
)
|
|
(62
|
)
|
|
—
|
|
|
(74
|
)
|
|||||
Net cash used by
investing activities |
—
|
|
|
(272
|
)
|
|
(698
|
)
|
|
—
|
|
|
(970
|
)
|
|||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt repaid, net of debt issued
|
—
|
|
|
177
|
|
|
(3
|
)
|
|
—
|
|
|
174
|
|
|||||
Dividends paid
|
(421
|
)
|
|
—
|
|
|
(1,089
|
)
|
|
1,089
|
|
|
(421
|
)
|
|||||
Common stock acquired, net of
issuance of common stock |
(1,643
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,643
|
)
|
|||||
Proceeds from noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Intercompany activity, net
|
927
|
|
|
(283
|
)
|
|
(644
|
)
|
|
—
|
|
|
—
|
|
|||||
Other, net
|
15
|
|
|
52
|
|
|
57
|
|
|
—
|
|
|
124
|
|
|||||
Net cash used by
financing activities |
(1,122
|
)
|
|
(54
|
)
|
|
(1,679
|
)
|
|
1,089
|
|
|
(1,766
|
)
|
|||||
Net increase (decrease) in cash
and cash equivalents |
(47
|
)
|
|
10
|
|
|
10
|
|
|
—
|
|
|
(27
|
)
|
|||||
Cash and cash equivalents at
beginning of period |
1,955
|
|
|
84
|
|
|
234
|
|
|
—
|
|
|
2,273
|
|
|||||
Cash and cash equivalents at
end of period |
$
|
1,908
|
|
|
$
|
94
|
|
|
$
|
244
|
|
|
$
|
—
|
|
|
$
|
2,246
|
|
|
|
EBITDA Margin (50%)
|
||
Performance Level*
|
|
3-year Average
|
Vesting Percentage
|
|
Outstanding
|
|
≥12.2%
|
|
150%
|
Target
|
|
11.9
|
%
|
100%
|
Threshold
|
|
11.2
|
%
|
50%
|
Below Threshold
|
|
<11.2%
|
|
0%
|
|
|
ROIC (30%)
|
||
Performance Level*
|
|
3-year Average
|
Vesting Percentage
|
|
Outstanding
|
|
≥19.3%
|
|
150%
|
Target
|
|
18.9
|
%
|
100%
|
Threshold
|
|
17.3
|
%
|
50%
|
Below Threshold
|
|
<17.3%
|
|
0%
|
|
|
Relative TSR (20%)
|
|
Performance Level
*
|
|
3-year TSR vs. Peer Group**
|
Vesting Percentage
|
Outstanding
|
|
≥75%
|
150%
|
Target
|
|
50%
|
100%
|
Threshold
|
|
35%
|
50%
|
Below Threshold
|
|
<35%
|
0%
|
•
|
Will be accelerated if, within the 24-month period following the Change in Control, the Grantee is terminated by the Company or the continuing entity without Cause or if the Grantee voluntarily terminates employment with Good Reason;
|
•
|
Will be accelerated at the Change in Control if awards are not assumed or replaced by the acquiror/continuing entity on terms deemed by the Compensation Committee to be appropriate; and
|
•
|
Will occur on the third anniversary of the Date of Grant, if Vesting has not otherwise been accelerated as provided above.
|
(i)
|
following a voluntary retirement and prior to the later to occur of (a) settlement date for the Performance Units or (b) two years following retirement, the Grantee renders personal services to a Competing Business (as hereafter defined in Section 17) in any manner, including, without limitation, as employee, agent, consultant, advisor, independent contractor, proprietor, partner, officer, director, manager, owner, financer, joint venturer or otherwise; or
|
(ii)
|
following a voluntary or involuntary retirement and prior to the later to occur of (a) the settlement date for the Performance Units or (b) two years following retirement, the Grantee directly or indirectly solicits or otherwise entices any of the Company’s employees to resign from their employment with the Company, whether individually or as a group; or
|
(iii)
|
at any time following a voluntary or involuntary retirement, the Grantee discloses or provides to any third party, or uses, modifies, copies or adapts any of the Company’s Confidential Information (as hereafter defined in Section 17).
|
1.
|
This General Release and Waiver
(“General Release”)
is given by
Peter Sachse
(“Executive”) to the Released Parties as defined below in this paragraph 1. This General Release will also be binding on Executive’s heirs, successors, assigns, agents, executors, and administrators. This General Release releases Macy’s, Inc. (“Macy’s”), all of its predecessors, successors, and assigns, divisions, subsidiaries, facilities, related or affiliated entities, (collectively referred to as “the Company”), and all of their respective current and former officers, directors, shareholders, employees, insurers, agents, and counsel, including, without limitation, any and all current and former management and supervisory employees (hereinafter collectively referred to as the “Released Parties”).
|
2.
|
The Company advises Executive to consult with an attorney prior to executing this General Release. Executive acknowledges that Executive has been advised by the Company, in writing, to consult with legal counsel of Executive’s choosing and that Executive has had the opportunity to consult counsel, if Executive chose to do so. Executive acknowledges that Executive is responsible for any costs and fees resulting from Executive’s attorney or any other advisor reviewing this General Release.
|
3.
|
The Company hereby advises Executive that Executive will not be eligible to receive benefits under any other severance plan if Executive elects to receive benefits under the MACY’S, INC. EXECUTIVE SEVERANCE PLAN (the “Plan”) by signing this General Release.
|
4.
|
To the extent applicable, it is intended that the payments under the Plan be in full compliance with Section 409A. The Company will not make any payments which it believes will violate Section 409A. The Company may at any time amend or terminate the benefits under the Plan to comply with Section 409A of the Internal Revenue Code. No amendment or termination may be made or effected if it would cause the Plan to fail to comply. Executive’s termination of employment shall be treated as an involuntary separation from service for purposes of 409A of the Internal Revenue Code of 1986, as amended.
|
5.
|
As consideration for Executive’s promises set forth in this General Release, the Company has agreed to provide the Executive with the benefits under the Plan. Employee acknowledges that the benefits provided under the Plan are more than the Company is otherwise obliged to provide to Executive.
Executive acknowledges and agrees that Company has paid Executive any outstanding amounts owed to Executive.
|
6.
|
In consideration for the payment of benefits provided to Executive upon Executive’s separation from employment, as described in the Plan, and pursuant to the terms of this General Release, Executive releases and discharges forever the Released Parties of and from all actions, causes of action, claims, demands, costs, and expenses for damages, known or unknown, which Executive had or now has or may have against the Company or any of the Released Parties. This release includes, but is not limited to: (a) any claim of age discrimination under the Age Discrimination in Employment Act, as amended, or under any other state or local statute, ordinance, order, or law; (b) any claim of discrimination on any other basis, including, without limitation, race, color, national origin, sex, sexual orientation, gender identity, religion, age, disability, military status, veteran status, marital status, political affiliation, appearance, or any other characteristic (including but not limited to status as a “whistleblower”), under any federal, state, or local statute, ordinance, order, or law, including but not limited to the Civil Rights Act of 1866, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Americans With Disabilities Act, the Older Worker’s Benefit Protection Act of 1990, the Family and Medical Leave Act, the Equal Pay Act, the Lilly Ledbetter Fair Pay Act of 2009
,
the Pregnancy Discrimination Act of 1978, and the laws in the state in which Executive worked for the Company, all as the same may have been from time-to-time amended; (c) any other claim relating to Executive’s employment, the termination of Executive’s employment, or the Released Parties’ failure to reemploy the Executive, under any federal, state, or local statute, law, or ordinance, as amended, and the Worker Adjustment and Retraining Notification Act; (d) any claim under any contract, tort, or any other state, local, or federal statutory or common law, including but not limited to any claim that the Released Parties, jointly or severally, breached any contract or promise, express or implied, or any term or condition of Executive’s employment, and any claim for promissory estoppel or wrongful discharge arising out of Executive’s employment with the Company or any of the Released Parties and/or the termination of such employment; (e) any claim arising under the Company’s internal dispute resolution
|
a.
|
This General Release does not waive or release any rights or claims that Executive may have under the Age Discrimination in Employment Act, as amended,
that arise after the date that Executive executes this General Release.
|
b.
|
Nor shall this General Release have any effect on Executive’s rights, if any: (i) accrued and vested prior to the employment termination date under the Company's ERISA benefit plans; (ii) brought pursuant to the terms of an ERISA plan; or (iii) arising under the provisions of Title X of the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA"), as the same have been amended, to continue coverage after the employment termination date under the Company's health plans.
|
8.
|
If and only if, Executive is a California based employee, Executive acknowledges and agrees that all rights Executive enjoys pursuant to Section 1542 of the California Civil Code are hereby expressly waived by Executive. Said Section reads as follows:
|
9.
|
Executive agrees that he or she has terminated or will terminate employment with the Company and that his or her last day of employment will be a date decided upon by the Company (the “Release Date”). The Executive will return (or has returned) all property of the Company, including but not limited to any Company electronic devices such as laptops, cell phones, smart phones, PDAs, security ID tokens, keys, identification, and any Company business or proprietary information in his or her possession, by no later than his or her Release Date.
|
10.
|
Executive acknowledges that the provision of the consideration referenced in the Plan above is conditioned upon the promises in this General Release and is not normally available under Company policy or any other plan or program of the Released Parties. Executive further acknowledges that such payment does not constitute an admission by the Company or any of the Released Parties of liability or of violation of any applicable law or regulation. The Company and the other Released Parties expressly deny any such liability or such alleged violation and state that payment has been made solely for the purpose of compromising any and all claims of the Executive without the cost and burden of litigation.
|
11.
|
Executive agrees that all provisions, terms and conditions of this General Release are and shall remain confidential and shall not be disclosed to any person not a party hereto under any circumstances, except as required by court order or other compulsory legal process. Neither Executive nor anyone on Executive’s behalf shall communicate, either orally or in writing, with any print or broadcast media about any matter arising out of Executive’s employment with the Company and/or Executive’s involuntary termination from the Company. Notwithstanding the foregoing, the parties hereto expressly agree that Executive may disclose the provisions, terms and conditions of this General Release to Executive’s immediate family, attorney(s), and/or financial advisor(s).
|
12.
|
Executive agrees that this General Release reflects the complete agreement between the parties hereto and that there are no written or oral understandings, promises, or agreements related to this General Release that have been made to Executive except those contained in this General Release. Executive further agrees that the General Release fully supersedes any and all prior agreements or understandings concerning the subject matter of this release, to the extent that any such prior agreements or understandings exist.
|
13.
|
Executive hereby agrees:
|
a.
|
Pending or threatened litigation:
to make himself or herself available upon reasonable notice to discuss with Macy’s and its counsel, issues related to litigation or potential litigation, to appear without subpoena for deposition or testimony, to meet with Macy’s attorneys for deposition preparation and trial preparation and to submit receipts for actual expenses, if any, for reimbursement in accordance with the Company’s expense reimbursement policy.
|
b.
|
No-solicit
: during a period of two years beginning on the Executive’s Release Date (the “No-recruit period”), that the Executive will not actively, in personal conversation or by telephone, in writing (including but not limited to via electronic communications) or by any other medium, either directly or indirectly, without written permission from the Company, solicit any person that Executive knows or should reasonably know to be an employee of the Company or any of its subsidiaries, divisions, or affiliates (whether such employees are now or hereafter through the No-recruit period so employed or engaged) to terminate their employment with the Company or any of its subsidiaries, divisions, or affiliates, and commence employment at, or provide services to, any other business enterprise.
|
c.
|
Confidential and Proprietary Information:
that Executive will not disclose any confidential or proprietary information belonging to the Company and obtained by Executive or to be obtained by Executive in the course of employment with the Company. The Company specifically acknowledges that since Executive has been involuntarily terminated, Executive shall be free to work for a Competing Business, as that term is defined in the Plan.
|
d.
|
Non-disparagement:
that Executive will take no action which is intended to, or would reasonably be expected to, harm the Released Parties, impair their reputations, or lead to unwarranted or unfavorable publicity regarding the Released Parties. The prohibition in this paragraph 13.d does not apply to communications with administrative or other governmental authorities or in response to valid compulsory legal process. In the event of such government inquiry or compulsory legal process requiring comments about any Released Party, Executive agrees to promptly notify the Company in advance of any such disclosures and provide the details of the government inquiry or compulsory legal process in order to enable the Company to consider objecting to any such disclosure.
|
14.
|
The Company hereby informs Executive that the consideration recited in this General Release is being offered as part of the MACY’S, INC. EXECUTIVE SEVERANCE PLAN. The Company further informs Executive of the following:
|
a.
|
As specified in the Plan: (i) The amount of the severance benefit payable under the Plan is equal to twenty four times Executive’s monthly base salary rate in effect at the time of Executive’s termination of employment; and (ii) The severance benefit will not be provided to an Executive who is otherwise entitled to benefits under the Plan if the Executive is offered a substantially equivalent position by, or accepts any position with, a Macy’s, Inc. division, subsidiary, facility, or related or affiliated entity prior to the employee’s receipt of severance benefits hereunder. For purposes of this provision, a newly offered position is considered substantially equivalent to the Executive’s former position if the work site of the new position is within twenty-five (25) miles, one way, of the work site of the former position, the new position does not require a reclassification from full-time to part-time status, and the annual base salary for the new and former positions are substantially comparable.
|
b.
|
In order to accept the Offer, an eligible employee must execute and return to the Company (and not revoke) this General Release within twenty-one (21) days as set forth in paragraph 15 below.
|
c.
|
If an Executive who is entitled to benefits under the Plan dies following Executive’s termination from employment, but prior to receipt of the severance payment provided under the Plan, payment shall be made to Executive’s estate, provided, however, if Executive dies before having signed the Release, payment shall be made to Executive's estate if and only if, no later than 70 days after the Executive’s termination of
|
15.
|
Executive acknowledges that Executive has twenty-one (21) calendar days from the date that this General Release was first given to Executive to read and consider it before executing it, although Executive could have executed it at any time within those twenty-one (21) calendar days. Executive agrees that any changes to this General Release do not restart the twenty-one (21) day consideration period. Executive agrees that Executive has carefully read this General Release and knows and understands its contents, and that Executive signs this General Release knowingly and voluntarily. This General Release was voluntarily entered into without fraud, duress, or coercion, and with full understanding of its significance, effects, and consequences, and Executive fully intends to be bound by its terms.
|
16.
|
The Executive may revoke and cancel this General Release by providing notice of revocation to the Company in writing at any time within seven (7) calendar days after his or her execution of this General Release. The written notice of revocation must be personally delivered or sent by first class mail, postage prepaid, or by certified mail to William Tompkins, Senior Vice President, Human Resources, located at 7 West Seventh Street, Cincinnati, OH 45202, within seven (7) calendar days after Executive’s execution of this General Release. If mailed, the date of the postmark or certification will be used to determine the date of revocation. If Executive does so revoke by personal delivery or mail, this General Release will be null and void and the Company shall have no obligation whatsoever pursuant to this General Release to provide the consideration referenced in paragraph 5. This General Release shall not become effective and enforceable until after the expiration of this seven (7) day revocation period; after such time, if there has been no revocation, the General Release shall be fully effective, enforceable, and irrevocable.
|
17.
|
If any provision of this General Release is declared invalid or unenforceable, the remaining portions of the General Release shall not be affected thereby and shall be enforced, provided, however, if the Executive’s obligations as set forth in paragraphs 6 and 8 (or any part of it) is declared invalid, the General Release is nullified in its entirety and Company is not obligated to make any payment to Executive
|
18.
|
This General Release shall be governed by the laws of the State of Ohio, without regard to conflict of laws principles.
|
A)
|
In connection with Executive’s employment by Macy’s, Executive has been:
|
i.
|
exposed to trade secrets and confidential business and technical information and strategies that provide Macy’s with a legitimate competitive advantage in the conduct of its business; and
|
ii.
|
brought into contact with existing and potential Customers, suppliers and vendors of Macy’s. In addition, the business of Macy’s is highly competitive. Macy’s devotes a substantial amount of time, effort and money to the development and maintenance of its Confidential Information and Customers and Macy’s Confidential Information and Customer information constitute valuable assets of Macy’s.
|
1)
|
“
Customer
” means any person or entity which at the time of Executive’s cessation of employment with Macy’s is, or was within two years prior to such cessation of employment, a prospective or existing customer of Macy’s.
|
2)
|
“
Confidential Information
” means any data or information that is material to Macy’s and not generally known to the public, including, without limitation: (i) price, cost, and sales data; (ii) the identities and locations of vendors and consultants furnishing materials and services to Macy’s and the terms of vendor or consultant contracts or arrangements; (iii) lists and other information regarding Customers and suppliers; (iv) financial information that has not been released to the public; (v) future business plans, marketing or licensing strategies, and advertising campaigns; or (vi) information about Macy’s employees and executives, as well as Macy’s talent strategies including but not limited to compensation, retention and recruiting initiatives.
|
B)
|
In exchange for the additional remuneration detailed in this Addendum,
and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
Executive agrees that for the thirty-six (36) month period beginning on the date that Executive’s employment with Macy’s ceases, Executive shall not act in any capacity (whether as an employee, agent, consultant, advisor, independent contractor, proprietor, partner, officer, director, manager, owner, financer, joint venturer or otherwise), for:
|
i.
|
any of the following named companies, or any other business into which such company is merged, consolidated, or otherwise combined: Abercrombie & Fitch; Bed, Bath & Beyond; Belk’s; Burlington Coat Factory; Bon-Ton Stores; Dillard’s; The Gap; J.C. Penney; Kohl’s; Limited Brands; Nordstrom; Neiman-Marcus; Ross Stores; Saks; Sears; Target; TJX; and Walmart, and the subsidiaries, affiliates and successors of each such company; or
|
ii.
|
a Restricted Business. A “
Restricted Business
” means any business or enterprise engaged in the business of retail sales that had annual revenues for its most recently completed fiscal year of at least $2.5 billion; and both (i) offers a category or categories of merchandise (e.g., Fine Jewelry, Cosmetics, Kids, Big Ticket, Housewares, Men’s, Dresses), any of which are offered by Macy’s, and (ii) the revenue derived by such other retailer during such retailer’s most recently ended fiscal year from such category or categories of merchandise represent(s), in the aggregate, more than 50% of Macy’s total revenues for the most recently completed
|
C)
|
upon the Executive’s termination of employment, the Company shall pay to Executive a lump sum of Two Million Seven Hundred Thousand Dollars and No Cents ($2,700,000.00), less withholding for applicable taxes. For the avoidance of doubt, Executive’s Release Date as set forth in Paragraph 9 of the General Release is January 30, 2017. This payment will be made at the same time as the payment pursuant to paragraph 14a of the General Release is made;
|
D)
|
on the date bonuses under the Company’s Senior Executive Incentive Compensation Plan are normally paid to employees, but no later than April 15, 2017, the Company shall pay to Executive a lump sum payment, less withholdings for applicable taxes, equivalent to the amount, if any, that would have been paid to Executive under the Company’s Senior Executive Incentive Compensation Plan for fiscal 2016 (the “2016 Bonus Amount”), it being acknowledged and agreed that for purposes of calculating the 2016 Bonus Amount Executive shall be: (i) deemed to have remained employed with the Company through March 2017 (or such later date as is required to receive such 2016 Bonus Amount), and (ii) Executive shall be treated no less favorably than other similarly situated senior executive officers of the Company. Executive agrees and acknowledges no other annual bonus awards or payments are due or owing to Executive under any bonus or incentive plan of the Company (other than as specifically set forth herein or as otherwise vested under such plans);
|
E)
|
Executive shall receive the shares of Common Stock payable with respect to Performance Restricted Stock Units (“PRSUs”) granted in 2014, 2015 and 2016 under the Amended and Restated 2009 Omnibus Incentive Compensation Plan, less withholdings for applicable taxes, as set forth below. The shares of Common Stock shall be paid to the Executive on the date such shares normally would be paid to employees under the Amended and Restated 2009 Omnibus Incentive Compensation Plan:
|
i.
|
with respect to the 2014 – 2016 performance period, it being acknowledged and agreed that (i) Executive shall be deemed to have remained employed with the Company through the February 2017 vesting date (or such later vesting date as is required in order to receive full vesting), (ii) there are no individual goals and/or targets required to be achieved by Executive in order to receive full vesting shall be deemed to have been achieved in full, (iii) Executive shall be treated no less favorably than other similarly situated senior executive officers of the Company and (iv) the Compensation and Management Development Committee of the Macy’s, Inc. Board of Directors certifies performance results related to such performance period and PRSUs and authorizes such PRSU payouts at its February 2017 meeting;
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ii.
|
with respect to the 2015 – 2017 performance period, it being acknowledged and agreed that (i) Executive shall be deemed to have remained employed with the Company through the February 2018 vesting date (or such later vesting date as is required in order to receive full vesting), (ii) there are no individual goals and/or targets required to be achieved by Executive in order to receive full vesting shall be deemed to have been achieved in full, (iii) Executive
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iii.
|
with respect to the 2016 – 2018 performance period, it being acknowledged and agreed that (i) Executive shall be deemed to have remained employed with the Company through the February 2019 vesting date (or such later vesting date as is required in order to receive full vesting), (ii) there are no individual goals and/or targets required to be achieved by Executive in order to receive full vesting shall be deemed to have been achieved in full, (iii) Executive shall be treated no less favorably than other similarly situated senior executive officers of the Company and (iv) the Compensation and Management Development Committee of the Macy’s, Inc. Board of Directors certifies performance results related to such performance period and PRSUs and authorizes such PRSU payouts at its February 2018 meeting.
|
F)
|
all unvested stock option awards will continue to vest on the anniversary of their grant dates through March 31, 2019, as if Executive remained employed with the Company through such date. All stock options that are vested as of March 31, 2019 shall be exercisable by Executive for the full term of each such stock option as if Executive remained in the continuous employ of the Company. Any stock option that is not vested as of March 31, 2019, shall be forfeited;
|
G)
|
within 30 days after the Executive’s execution of this General Release, the Company shall reimburse Executive for attorneys’ fees incurred in connection with Executive’s termination up to a maximum of Ten Thousand Dollars and No Cents ($10,000.00); and
|
H)
|
if Executive is eligible for and elects either COBRA health care continuation coverage or retiree health care benefits, the Company will pay the entire premium (both the employer and employee portions and any administrative fee applicable to COBRA recipients) for an eighteen (18) month period. If applicable, this Company-paid eighteen (18) month period shall count towards the maximum eighteen (18) month period of COBRA health care continuation coverage. This subsidy will apply only if Executive elects such coverage, completes and submits the applicable paperwork, remains eligible for this coverage during the applicable period, and does not become enrolled in other health care coverage. Executive may elect COBRA health care continuation coverage or retiree health care benefits, but not both;
|
I)
|
upon the Executive’s termination of employment, the Company shall reimburse Executive up to a maximum of Twenty-five Thousand Dollars and No Cents ($25,000.00), for outplacement services provided by a third-party selected by Executive. Such expenses shall be reimbursed by the Company as soon as practical after receiving proof of the expenses from the Executive, but in no event shall such services be utilized later than December 31, 2017;
|
J)
|
For the avoidance of doubt, Executive may retain his Company issued smart phone and Executive is permitted to maintain his personal contacts without violating the restrictions in paragraph 9 of the General Release so long as Executive has not stored any confidential Company information on such device;
|
K)
|
For the avoidance of doubt, the matters subject to the obligations set forth in paragraph 13a relate to matters that occurred during Executive’s employment tenure with the Company;.
|
L)
|
For the avoidance of doubt, the restrictions in paragraph 13b do not apply to general advertisements not targeted at the Company’s employees and requests for references by the Company’s employees;
|
M)
|
Notwithstanding the provisions in paragraph 13c of the General Release, the prohibitions expire ten (10) years from Executive’s Release Date and do not apply to communications with administrative or other governmental authorities or in response to valid compulsory legal process. In the event of such government inquiry or compulsory legal process requiring comments about any party or Released Party, Executive agrees to promptly notify the Company in advance of any such disclosures and provide the details of the government inquiry or compulsory legal process in order to enable the Company to consider objecting to any such disclosure. In addition, the Company’s senior executives will not make disparaging remarks about or in any other way condone or seek by word or act to harm or impair Executive’s reputation, provided that the prohibition in this paragraph expire ten (10) years from Executive’s Release Date and does not apply to communications with administrative or other governmental authorities or in response to valid compulsory legal process, including, but not limited to a subpoena. In the event of such government inquiry or compulsory legal process requiring comments about Executive, the Company shall promptly notify Executive in advance of any such disclosures and provide Executive the details of the government inquiry or compulsory legal process in order to enable Executive to consider objecting to any such disclosure; and
|
N)
|
This General Release and Addendum does not waive or release any rights to: (i) any indemnification rights under the Company’s by-laws, charters, Directors and Officers liability insurance policies or any other documents or instruments relating to indemnification or otherwise under the law; (ii); payment of five (5) weeks of retiree Paid Time Off in accordance with Company policy; and (iii) enforce this General Release and Addendum.
|
January 9, 2017
|
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/s/ SHERRY HOLLOCK
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|
Date
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|
Sherry Hollock
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|
Chief Human Resources Officer
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Macy’s, Inc.
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7 West Seventh Street
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Cincinnati, OH 45202
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1/9/2017
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/s/ PETER R. SACHSE
|
|
Date
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Peter Sachse
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|
|||
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|
Corporate Name
|
State of Incorporation/
Formation
|
Trade Name(s)
|
|
Advertex Communications, Inc.
|
New York
|
Macy’s Marketing
|
|
Bloomingdale's, Inc.
|
Ohio
|
|
|
Bloomingdale’s The Outlet Store, Inc.
|
Ohio
|
|
|
Bloomingdales.com, LLC
|
Ohio
|
|
|
Bluemercury, Inc.
|
Delaware
|
|
|
FDS Bank
|
N/A
|
|
|
FDS Thrift Holding Co., Inc.
|
Ohio
|
|
|
Macy's Backstage, Inc.
|
Ohio
|
|
|
Macy’s Corporate Services, Inc.
|
Ohio
|
|
|
Macy’s Credit and Customer Services, Inc.
|
Ohio
|
|
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Macy’s Credit Operations, Inc.
|
Ohio
|
|
|
Macy’s Florida Stores, LLC
|
Ohio
|
Macy’s
|
|
Macy’s Merchandising Corporation
|
New York
|
|
|
Macy’s Merchandising Group (Hong Kong)
Limited
|
Hong Kong
|
|
|
Macy’s Merchandising Group International
(Hong Kong) Limited
|
Hong Kong
|
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Macy’s Merchandising Group International, LLC
|
Delaware
|
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Macy’s Merchandising Group Procurement, LLC
|
Delaware
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|
|
Macy’s Merchandising Group, Inc.
|
New York
|
|
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Macy’s Retail Holdings, Inc.
|
New York
|
Macy’s
|
|
Macy’s Systems and Technology, Inc.
|
Ohio
|
|
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Macy’s West Stores, Inc.
|
Ohio
|
Macy’s
|
|
Macys.com, LLC
|
Ohio
|
|
|
West 34
th
Street Insurance Company New York
|
New York
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||||
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/s/ Francis S. Blake
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/s/ John Bryant
|
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/s/ Deirdre P. Connelly
|
Francis S. Blake
|
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John Bryant
|
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Deirdre P. Connelly
|
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|
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/s/ Jeff Gennette
|
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/s/ Leslie D. Hale
|
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/s/ Karen M. Hoguet
|
Jeff Gennette
|
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Leslie D. Hale
|
|
Karen M. Hoguet
|
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|
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/s/ William H. Lenehan
|
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/s/ Sara Levinson
|
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/s/ Terry J. Lundgren
|
William H. Lenehan
|
|
Sara Levinson
|
|
Terry J. Lundgren
|
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/s/ Joyce M. Roché
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/s/ Paul C. Varga
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/s/ Marna C. Whittington
|
Joyce M. Roché
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Paul C. Varga
|
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Marna C. Whittington
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/s/ Felicia Williams
|
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/s/ Annie Young-Scrivner
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Felicia Williams
|
|
Annie Young-Scrivner
|
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|
|
CERTIFICATION
|
|||||
|
|
||||
I, Jeff Gennette, certify that:
|
|||||
|
|||||
|
1.
|
I have reviewed this Annual Report on Form 10-K of Macy's, Inc.;
|
|||
|
|
|
|||
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
|||
|
|
|
|||
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
|||
|
|
|
|||
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|||
|
|
|
|||
|
|
a.
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
||
|
|
|
|
||
|
|
b.
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
||
|
|
|
|
||
|
|
c.
|
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
||
|
|
|
|
||
|
|
d.
|
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
|
||
|
|
|
|||
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
|
|||
|
|
|
|||
|
|
a.
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
||
|
|
|
|
||
|
|
b.
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
||
|
|
|
|
||
|
|
|
|||
|
|
|
|||
March 29, 2017
|
/s/Jeff Gennette
|
||||
|
Jeff Gennette
|
||||
|
Chief Executive Officer
|
CERTIFICATION
|
|||||
|
|
||||
I, Karen M. Hoguet, certify that:
|
|||||
|
|||||
|
1.
|
I have reviewed this Annual Report on Form 10-K of Macy's, Inc.;
|
|||
|
|
|
|||
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
|||
|
|
|
|||
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
|||
|
|
|
|||
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|||
|
|
|
|||
|
|
a.
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
||
|
|
|
|
||
|
|
b.
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
||
|
|
|
|
||
|
|
c.
|
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
||
|
|
|
|
||
|
|
d.
|
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
|
||
|
|
|
|||
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
|
|||
|
|
|
|||
|
|
a.
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
||
|
|
|
|
||
|
|
b.
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
||
|
|
|
|
||
|
|
|
|||
|
|
|
|||
March 29, 2017
|
/s/ Karen M. Hoguet
|
||||
|
Karen M. Hoguet
|
||||
|
Chief Financial Officer
|
CERTIFICATION UNDER SECTION 906 OF THE SARBANES-OXLEY ACT
|
|||
|
|||
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, in connection with the filing of the Annual Report on Form 10-K of Macy's, Inc. (the "Company") for the fiscal year ended January 28, 2017, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned officer of the Company certifies that, to his knowledge:
|
|||
|
|||
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
|
|
|
|
|
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.
|
|
|
|
|
|
Dated: March 29, 2017
|
|||
|
|||
|
/s/ Jeff Gennette
|
||
|
Name: Jeff Gennette
|
||
|
Title: Chief Executive Officer
|
CERTIFICATION UNDER SECTION 906 OF THE SARBANES-OXLEY ACT
|
|||
|
|||
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, in connection with the filing of the Annual Report on Form 10-K of Macy's, Inc. (the "Company") for the fiscal year ended January 28, 2017, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned officer of the Company certifies that, to her knowledge:
|
|||
|
|||
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
|
|
|
|
|
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.
|
|
|
|
|
|
Dated: March 29, 2017
|
|||
|
|||
|
|
||
|
/s/Karen M. Hoguet________________________
|
||
|
Name: Karen M. Hoguet
|
||
|
Title: Chief Financial Officer
|