Federated Cites Concerns About Fingerhut DelinquenciesThe stock of Federated Department Stores Inc., Cincinnati, slid sharply yesterday after the company posted sales growth figures that were below analysts' expectations and said that credit delinquencies had increased in its Fingerhut division.
"We are concerned about the rise in credit delinquencies at Fingerhut in June, and we are monitoring this situation closely," James Zimmerman, chairman and CEO of Federated, said in a prepared statement.
Federated, the parent of Macy's, Bloomingdale's and other department store chains, acquired direct marketing giant Fingerhut Cos. last year. Fingerhut targets low- to middle-income consumers with catalogs and direct mail, and it offers to finance its customers' purchases.
For the five weeks ending July 1, Federated said its direct-to-consumer sales, which include its department store catalogs and Web sites in addition to Fingerhut, were $154 million, down 8.2 percent from the same period a year ago. Total sales for the company were $1.57 billion for the period, a decline of 0.3 percent from the year-ago period.