<SEC-DOCUMENT>0000794367-16-000285.txt : 20161110
<SEC-HEADER>0000794367-16-000285.hdr.sgml : 20161110
<ACCEPTANCE-DATETIME>20161110085207
ACCESSION NUMBER:		0000794367-16-000285
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20161110
ITEM INFORMATION:		Results of Operations and Financial Condition
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20161110
DATE AS OF CHANGE:		20161110

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			Macy's, Inc.
		CENTRAL INDEX KEY:			0000794367
		STANDARD INDUSTRIAL CLASSIFICATION:	RETAIL-DEPARTMENT STORES [5311]
		IRS NUMBER:				133324058
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0117

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-13536
		FILM NUMBER:		161986123

	BUSINESS ADDRESS:	
		STREET 1:		7 WEST SEVENTH STREET
		CITY:			CINCINNATI
		STATE:			OH
		ZIP:			45202
		BUSINESS PHONE:		5135797000

	MAIL ADDRESS:	
		STREET 1:		7 W SEVENTH ST
		CITY:			CINCINNATI
		STATE:			OH
		ZIP:			45202

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	FEDERATED DEPARTMENT STORES INC /DE/
		DATE OF NAME CHANGE:	19950307

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	R H MACY & CO INC
		DATE OF NAME CHANGE:	19950307

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	MACY ACQUIRING CORP
		DATE OF NAME CHANGE:	19861124
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>es8k11102016.htm
<DESCRIPTION>FORM 8-K FILED ON NOVEMBER 10, 2016
<TEXT>





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  <h2 style='margin:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:10.0pt;font-family:"Arial","sans-serif";color:windowtext;font-weight:bold;'>UNITED STATES</h2>
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  <h2 style='margin:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:10.0pt;font-family:"Arial","sans-serif";color:windowtext;font-weight:bold;'>SECURITIES AND EXCHANGE COMMISSION</h2>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'><b>Washington</b><b>, D.C.</b><b>&nbsp; 20549</b></p>
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  <h4 style='margin:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:14.0pt;font-family:"Times New Roman","serif";color:windowtext;font-weight:normal;'>FORM 8-K</h4>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>CURRENT REPORT</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>Pursuant to Section 13 or 15(d) of The</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>Securities Exchange Act of 1934</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>Date of Report:&nbsp; November 10, 2016</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
  </td>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
  </td>
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  <td width=638 colspan=3 valign=top style='width:6.65in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin-bottom:.0001pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="5">MACY'S, INC.</font></b></p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
  </td>
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  <td width=638 colspan=3 valign=top style='width:6.65in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>7 West Seventh Street, Cincinnati, Ohio 45202<br>
  (513) 579-7000</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>-and-</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
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  <td width=638 colspan=3 valign=top style='width:6.65in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>151 West 34<sup>th</sup> Street, New York, New York 10001<br>
  (212) 494-1602</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>Delaware</p>
  </td>
  <td width=222 valign=top style='width:166.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:7.15pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>1-13536</p>
  </td>
  <td width=241 valign=top style='width:180.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:7.15pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>13-3324058</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>(State of Incorporation)</p>
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  height:7.1pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>(Commission File Number)</p>
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  height:7.1pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>(IRS Employer Identification No.)</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
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  height:7.1pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>Check the appropriate
  box below if the Form 8-K is intended to simultaneously satisfy the filing
  obligation of the registrant under any of the following provisions:</p>
  </td>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>[&nbsp;&nbsp;&nbsp;]&nbsp;&nbsp;Written communications pursuant to Rule&nbsp;425 under the
  Securities Act (17 CFR 230.425)</p>
  </td>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>[&nbsp;&nbsp;&nbsp;]&nbsp;&nbsp;Soliciting material pursuant to Rule&nbsp;14a-12 under the
  Exchange Act (17 CFR 240.14a-12)</p>
  </td>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>[&nbsp;&nbsp;&nbsp;]&nbsp;&nbsp;Pre-commencement communications pursuant to Rule&nbsp;14d-2(b)
  under the Exchange Act (17 CFR 240.14d-2(b))</p>
  </td>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>[&nbsp;&nbsp;&nbsp;]&nbsp;&nbsp;Pre-commencement communications pursuant to Rule&nbsp;13e-4(c)
  under the Exchange Act (17 CFR 240.13e-4(c))</p>
  </td>
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<p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>

<br
clear=all style='page-break-before:always'>


<p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
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  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>Item 2.02.</p>
  </td>
  <td width=559 valign=top style='width:419.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'><u>Results of
  Operations and Financial Condition</u>.</p>
  </td>
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 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=559 valign=top style='width:419.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
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  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=559 valign=top style='width:419.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>On November 10,
  2016, Macy's, Inc. (&quot;Macy's&quot;) issued a press release announcing
  Macy's financial condition and results of operations for the 13 and 39 weeks
  ended October 29, 2016.&nbsp; The full text of the press release is attached
  hereto as Exhibit 99.1 and is incorporated herein by reference.</p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;font-family:"Times New Roman","serif";color:windowtext; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Macy's reports its financial results in accordance with
  U.S. generally accepted accounting principles (&quot;GAAP&quot;).&nbsp; The press release
  referred to above contains non-GAAP financial measures of changes in comparable
  sales on an owned plus licensed basis, operating income and operating income
  as a percent of sales, excluding certain items and diluted earnings per share
  attributable to Macy's shareholders, excluding certain items.&nbsp; The
  excluded items consist of impairment and other costs primarily related to
  anticipated store closings and settlement charges relating to Macy's defined
  benefit retirement plans.&nbsp; </font> </p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:11.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;font-family:"Times New Roman","serif";color:windowtext; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Macy's 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, Macy's includes these
  commissions (rather than sales of the departments licensed to third parties)
  in its net sales. Macy's does not, however, include any amounts in respect of
  licensed department sales (or any commissions earned on such sales) in its
  comparable sales calculation on an owned basis.&nbsp; Management believes
  that the amounts of commissions earned on sales of departments licensed to
  third parties are not material to its results of operations for the periods
  presented.&nbsp; Management believes that providing changes in comparable sales on
  an owned plus licensed basis is a useful measure to assist investors in
  evaluating Macy's ability to generate sales growth, whether through owned
  businesses or departments licensed to third parties, on a comparable basis. Management
  believes that providing changes in comparable sales on an owned plus licensed
  basis is particularly useful in evaluating the impact of changes in the
  manner in which certain departments are operated.&nbsp; The reconciliation of the
  forward-looking non-GAAP financial measure of changes in comparable sales on
  an owned plus licensed basis to GAAP comparable sales (i.e., on an owned
  basis) is in the same manner as illustrated in the press release, where the
  impact of growth in comparable sales of departments licensed to third parties
  is the only reconciling item.</font></p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:11.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;font-family:"Times New Roman","serif";color:windowtext; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Management believes that diluted earnings per share
  attributable to Macy's shareholders, operating income and operating income as
  a percent of sales excluding certain items are useful measures in evaluating
  Macy's ability to generate earnings from operations and that providing such
  measures will allow investors to more readily compare the earnings referred
  to in the press release to the earnings reported by Macy's in past and future
  periods.&nbsp; Management believes that excluding certain items from these
  calculations is particularly useful where the amounts of such items are not
  consistent in the periods presented.&nbsp; Macy's does not provide the most
  directly comparable forward-looking GAAP measure of diluted earnings per
  share attributable to Macy's shareholders because the timing and amount of
  excluded items (e.g., asset impairment charges, retirement settlement charges
  and other store closing related costs) are unreasonably difficult to fully
  and accurately estimate.</font></p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:11.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;font-family:"Times New Roman","serif";color:windowtext; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">The reader is cautioned that any non-GAAP financial
  measures provided by Macy's are provided in addition to, and not as
  alternatives for, Macy's reported results prepared in accordance with GAAP.
  Certain items that may have a significant impact on Macy's financial
  position, results of operations and cash flows must be considered when
  assessing Macy's actual and future financial condition and performance
  regardless of whether these items are included in these non-GAAP financial
  measures. In addition, you should note that the amounts received by Macy's on
  account of sales of departments licensed to third parties are limited to
  commissions received on such sales. The methods used by Macy's to calculate
  its non-GAAP financial measures may differ significantly from methods used by
  other companies to compute similar measures. As a result, any non-GAAP
  financial measures provided by Macy's may not be comparable to similar
  measures provided by other companies.</font></p>
  <p style='margin-bottom:.0001pt;font-family:"Times New Roman","serif";color:windowtext; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">&nbsp;</font></p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=559 valign=top style='width:419.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
 </tr>
</table>

<font size="2">

<br
clear=all style='page-break-before:always'>


</font>


<p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=79 colspan=2 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>Item 9.01.</p>
  </td>
  <td width=559 colspan=3 valign=top style='width:419.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'><u>Financial
  Statements and Exhibits</u>.</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=79 colspan=2 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=559 colspan=3 valign=top style='width:419.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=79 colspan=2 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=54 valign=top style='width:40.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>(d)</p>
  </td>
  <td width=505 colspan=2 valign=top style='width:378.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>Exhibits</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.1pt'>
  <td width=638 colspan=5 valign=top style='width:6.65in;padding:0in 5.4pt 0in 5.4pt;
  height:7.1pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.0pt'>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=66 colspan=2 valign=top style='width:49.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>99.1</p>
  </td>
  <td width=433 valign=top style='width:324.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>Press Release
  of Macy's dated November 10, 2016.</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.0pt'>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=66 colspan=2 valign=top style='width:49.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=433 valign=top style='width:324.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=638 colspan=5 valign=top style='width:6.65in;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
 </tr>
 <tr height=0>
  <td width=67 style='border:none'></td>
  <td width=12 style='border:none'></td>
  <td width=54 style='border:none'></td>
  <td width=72 style='border:none'></td>
  <td width=433 style='border:none'></td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>

<font size="2">

<br
clear=all style='page-break-before:always'>


</font>


<p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=655
 style='width:491.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=655 colspan=2 valign=top style='width:491.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=655 colspan=2 valign=top style='width:491.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'><b>MACY'S, INC.<br>
  <br>
  </b></p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=655 colspan=2 valign=top style='width:491.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=655 colspan=2 valign=top style='width:491.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;font-weight:normal;text-decoration:underline;'>SIGNATURE<br>
  <br>
  </h3>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=655 colspan=2 valign=top style='width:491.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=655 colspan=2 valign=top style='width:491.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>Pursuant to the
  requirements of the Securities Exchange Act of 1934, the registrant has duly
  caused this report to be signed on its behalf by the undersigned hereunto
  duly authorized.<br>
  <br>
  </p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=655 colspan=2 valign=top style='width:491.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=259 valign=top style='width:2.7in;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=396 valign=top style='width:297.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>MACY'S, INC.<br>
  <br>
  </p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=259 valign=top style='width:2.7in;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=396 valign=top style='width:297.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=259 valign=top style='width:2.7in;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>Dated:&nbsp;&nbsp;November
  10, 2016</p>
  </td>
  <td width=396 valign=top style='width:297.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>By:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>/s/
  Elisa D. Garcia&nbsp; </u></p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=259 valign=top style='width:2.7in;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=396 valign=top style='width:297.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>Name:&nbsp;&nbsp;Elisa
  D. Garcia</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=259 valign=top style='width:2.7in;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=396 valign=top style='width:297.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>Title:&nbsp;&nbsp;&nbsp; Chief
  Legal Officer and Secretary</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=259 valign=top style='width:2.7in;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=396 valign=top style='width:297.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;font-size:11.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>

<font size="2">

<br
clear=all style='page-break-before:always'>


</font>


<p style='margin:0in;margin-bottom:.0001pt;font-size:11.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:4.75pt'>
  <td width=638 colspan=4 valign=top style='width:6.65in;padding:0in 5.4pt 0in 5.4pt;
  height:4.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'><u>Index to Exhibits</u></p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.1pt'>
  <td width=638 colspan=4 valign=top style='width:6.65in;padding:0in 5.4pt 0in 5.4pt;
  height:7.1pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.0pt'>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>Index <u>Number</u></p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=498 valign=top style='width:373.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;text-align:center'>&nbsp;</p>
  </td>
  <td style='border:none;padding:0in 0in 0in 0in' width=1><p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.0pt'>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=498 valign=top style='width:373.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td style='border:none;padding:0in 0in 0in 0in' width=1><p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.0pt'>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>99.1</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>
  </td>
  <td width=498 valign=top style='width:373.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>Press Release
  of Macy's dated November 10, 2016.</p>
  </td>
  <td style='border:none;padding:0in 0in 0in 0in' width=1><p style='margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;font-size:11.0pt;font-family:"Times New Roman","serif";color:windowtext;'>&nbsp;</p>

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</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>esexhibit991.htm
<DESCRIPTION>PRESS RELEASE DATED NOVEMBER 10, 2016
<TEXT>




</head>

<body lang=EN-US link=blue vlink=purple>

<div style='page:WordSection1;'>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:4.5in;text-align:center;
text-indent:.5in'><b>Exhibit 99.1</b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman","serif";margin:0in;margin-bottom:.0001pt;text-align:center'><b><font style="font-size: 36.0pt">macy's inc.</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">Contacts:</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">Media &#150; Holly Thomas</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;&nbsp; 646/429-5250</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;&nbsp; holly.thomas@macys.com</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">Investor &#150; Matt Stautberg</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;&nbsp; 513/579-7780</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">FOR IMMEDIATE RELEASE</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b>MACY'S, INC. REPORTS THIRD QUARTER
EARNINGS, REAFFIRMS FULL-YEAR EPS GUIDANCE; RAISES FULL&#150;YEAR SALES GUIDANCE</b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b>&nbsp;</b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'>&nbsp;<font style="font-size: 11.0pt">CINCINNATI,
Ohio, November 10, 2016 &#150; Macy's, Inc. today reported diluted earnings per
share of 5 cents in the third quarter of 2016 ended October 29, 2016. Excluding
non-cash retirement plan settlement charges of $62 million, or 12 cents per
diluted share (as described below), third quarter earnings per share were 17
cents. The company's earnings for the third quarter of 2016 compare with 36
cents per diluted share in the third quarter of 2015, or 56 cents per diluted
share excluding asset impairment and other charges of $111 million, or 20 cents
per diluted share, primarily related to store closings.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">The company also reaffirmed its previous
earnings-per-share guidance and raised its sales guidance for full-year 2016. </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><i><font style="font-size: 11.0pt">(Editor's Note: This morning, Macy's, Inc. also issued
a separate news release announcing a strategic alliance with Brookfield Asset
Management as part of its strategy to create increased value from its real
estate portfolio.)</font></i><font style="font-size: 11.0pt"> </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">Macy's, Inc.'s diluted earnings per share for the
first three quarters of 2016 were 46 cents ($1.11 per share excluding asset
impairment and other charges primarily related to upcoming store closings and
non-cash retirement plan settlement charges, as described below), compared with
diluted earnings per share of $1.56 in the same period last year ($1.76 per
diluted share excluding asset impairment and other charges of $111 million primarily
related to store closings).</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">&#147;The
trends we saw in the third quarter give us confidence that we can deliver our
expectations for the fourth quarter and our guidance for fiscal 2016. Our third
quarter top line results were better than the first half of the year and our
sales-driving initiatives continue to gain traction.&nbsp; Additionally, the
strengthening trend across the apparel businesses, coupled with new initiatives
like tech watches from Apple, Michael Kors and others, are good indicators for
an improved performance in the fourth quarter,&#148;&nbsp;said Terry J. Lundgren,
Macy's chairman and chief executive officer.&nbsp; </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">&#147;Our
customers tell us we are their holiday shopping destination, and we are excited
about our gift assortments, marketing strategies and digital enhancements, all
of which should set us up for a stronger finish to the year and position us
well for an improved performance in 2017 and beyond. </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">&#147;As
we have said, a setback is a setup for a comeback and that is why we continue
to look with confidence at the close of 2016 and our longer-term outlook. We
are reallocating and prioritizing our spending to drive growth, improve the
customer experience, increase our agility and deliver strong financial
results.&nbsp;We also are making good progress on our strategies to create
shareholder value through our real estate, while preserving our ability to
operate as a top retailer with a healthy balance sheet.&#148;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt'><b><u><font style="font-size: 11.0pt"><br>
Sales</font></u></b><font style="font-size: 11.0pt"> </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">Sales in the third quarter of 2016 totaled $5.626
billion, a decrease of 4.2 percent, compared with sales of $5.874 billion in
the same period last year. Comparable sales on an owned plus licensed basis
were down by 2.7 percent in the third quarter. On an owned basis, third quarter
comparable sales declined by 3.3 percent. The difference between the
year-over-year change in total and comparable sales largely resulted from the
closing of 41 underperforming Macy's stores at the end of fiscal 2015. </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">For the year to date, Macy's, Inc.'s sales totaled
$17.263 billion, down 5.2 percent from total sales of $18.210 billion for the
first three quarters of 2015. Comparable sales on an owned plus licensed basis
were down by 3.5 percent year to date in 2016. On an owned basis, year to date
comparable sales declined by 4.0 percent. </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">In
the third quarter, the company opened a new Macy's store in Kapolei, HI, a
Macy's Backstage store in San Antonio, TX, and seven Bluemercury freestanding
specialty stores. Earlier this month, the company opened a Bloomingdale's
Outlet in Orange County, CA.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt'><b><u><font style="font-size: 11.0pt">Operating Income</font></u></b><font style="font-size: 11.0pt"> </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">Macy's, Inc.'s operating income totaled $107 million
or 1.9 percent of sales for the quarter ended October 29, 2016. Excluding
non-cash settlement charges related to the company's retirement plans of $62
million, operating income for the third quarter was $169 million or 3.0 percent
of sales. This compares with operating income of $258 million or 4.4 percent of
sales for the same period last year or $369 million or 6.3 percent of sales
excluding asset impairment and other charges of $111 million. </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">For the first three quarters of 2016, Macy's, Inc.'s
operating income totaled $500 million or 2.9 percent of sales. Excluding asset
impairment and other charges of $249 million and non-cash settlement charges
related to the company's retirement plans of $81 million, operating income for
the first three quarters of 2016 was $830 million, or 4.8 percent of sales.
This compares with operating income of $1.103 billion, or 6.1 percent of sales,
for the first three quarters of 2015 or $1.214 billion or 6.7 percent of sales
excluding asset impairment and other charges of $111 million. </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt'><b><u><font style="font-size: 11.0pt"><br>
Cash Flow</font></u></b><font style="font-size: 11.0pt"> </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">Net cash provided by operating activities was $308
million in the first three quarters of 2016, compared with $278 million in the
first three quarters of last year. Net cash used by investing activities in the
first three quarters of 2016 was $491 million, compared with $861 million a
year ago. Investing activities in the first three quarters of 2015 included the
acquisition of Bluemercury. Net cash used by financing activities in the first
three quarters of 2016 was $469 million, compared with $1.189 billion in the
first three quarters of 2015. </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">In the third quarter of 2016, the company resumed its
stock buyback program and repurchased approximately 3 million shares of its
common stock for a total of approximately $108 million.&nbsp; In the first nine
months, the company repurchased approximately 6 million shares of its common
stock for approximately $238 million. At October 29, 2016, the company had
remaining authorization to repurchase up to approximately $1.8 billion of its
common stock. <br>
<br>
</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt'><b><u><font style="font-size: 11.0pt">Real Estate Update </font></u></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">Macy's,
Inc. continues to make progress toward its goal of creating value from its real
estate assets. The company announced today (see separate news release) that it
has formed a strategic alliance with Brookfield Asset Management, to further
explore value creation opportunities in its real estate portfolio.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">Separately,
Macy's has signed a contract to sell its 248,000 square-foot Union Square Men's
building in San Francisco for $250 million, and will use part of the proceeds
to consolidate the Men's store into its main Union Square store. Macy's will
lease the Men's store property for two to three years as it completes the reconfiguration
of the main store. The company expects the transaction to close in January 2017
and expects to recognize a gain of approximately $235 million in January 2018.
The company continues to explore options for its downtown Minneapolis, State
Street (Chicago) and Herald Square (New York City) stores.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">The
company has also signed a contract to sell its downtown Portland, OR store for
$54 million. The transaction is expected to close in the fourth quarter of
2016, at which time a gain of approximately $36 million will be recognized. The
downtown Portland store will continue operations through the holiday season and
will be closed in spring 2017. </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">The
company announced last week the sale of five locations to General Growth
Properties. In addition, as a result of lease terminations or expirations, the
company will be closing Macy's stores in Douglaston Mall, Douglaston, NY and
Lancaster Mall, Salem, OR in early 2017.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">Since
the beginning of 2015, Macy's has announced or completed asset sales with
anticipated proceeds exceeding $800 million and we expect continued progress
going forward.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt'><b><u><font style="font-size: 11.0pt">Looking Ahead</font></u></b><font style="font-size: 11.0pt"> </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">The company remains confident in its previously
provided full-year earnings per share guidance and expects full-year sales to
be better than its prior guidance. </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">Macy's, Inc. expects full-year 2016 comparable sales
on an owned plus licensed basis to decrease in the range of 2.5 percent to 3.0
percent (compared with previous guidance of a decrease in the range of 3
percent to 4 percent), with comparable sales on an owned basis to be
approximately 50<b><i> </i></b>basis points<b><i> </i></b>lower. The company
continues to expect diluted earnings per share (excluding asset impairment
charges and retirement settlement charges) in fiscal 2016 to be in a range of
$3.15 to $3.40. <br>
<br>
</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt'><b><u><font style="font-size: 11.0pt">Important Information Regarding Financial Measures</font></u></b><font style="font-size: 11.0pt"> </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">Please see the final pages of this news release for
important information regarding the calculation of the company&#146;s non-GAAP
financial measures. <br>
<br>
</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">Macy's, Inc., with corporate offices in Cincinnati and
New York, is one of the nation's premier retailers, with fiscal 2015 sales of
$27.079 billion. The company operates about 880 stores in 45 states, the District
of Columbia, Guam and Puerto Rico under the names of Macy's, Bloomingdale's,
Bloomingdale's Outlet, Macy's Backstage and Bluemercury, as well as the
macys.com, bloomingdales.com and bluemercury.com websites. Bloomingdale's in
Dubai is operated by Al Tayer Group LLC under a license agreement. </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">All
statements in this press release that are not statements of historical fact are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Such statements are based upon the current
beliefs and expectations of Macy's management and are subject to significant
risks and uncertainties. Actual results could differ materially from those
expressed in or implied by the forward-looking statements contained in this
release because of a variety of factors, including conditions to, or changes in
the timing of, proposed real estate and other transactions, prevailing interest
rates and non-recurring charges, store closings, competitive pressures from
specialty stores, general merchandise stores, off-price and discount stores,
manufacturers&#146; outlets, the Internet, mail-order catalogs and television
shopping and general consumer spending levels, including the impact of the
availability and level of consumer debt, the effect of weather and other
factors identified in documents filed by the company with the Securities and
Exchange Commission. </font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt"><br>
#&nbsp;&nbsp; #&nbsp;&nbsp; #<br>
<br>
</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-indent:.5in'><font style="font-size: 11.0pt">(NOTE:
Additional information on Macy's, Inc., including past news releases, is
available at www.macysinc.com/pressroom</font></a>.<i> </i>A
webcast of Macy's, Inc.'s call with analysts and investors will be held today
(November 10) at 10 a.m. (ET). Macy's, Inc.'s webcast is accessible to the
media and general public via the company's website at   www.macysinc.com</a>. Analysts and investors
may call in on 1-888-215-6825, passcode 6176641. A replay of the conference
call can be accessed on the Web site or by calling 1-888-203-1112 (same
passcode) about two hours after the conclusion of the call. </p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'><font style="font-size: 11.0pt">Macy's, Inc. management will present at the Morgan
Stanley Global Consumer &amp; Retail Conference at 8 a.m. (ET) on Wednesday,
November 16, 2016, in New York City. Media and investors may access the live webcast of the presentation at <u>www.macysinc.com</u> at that time. The
webcasts will be available for replay.</font></p>

<br
clear=all style='page-break-before:always'>


<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">MACY'S, INC.</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">Consolidated Statements of Income (Unaudited) (Note 1)</font></u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">(All amounts in millions except percentages and per
share figures)</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=684
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  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=171 colspan=2 valign=top style='width:128.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:-5.4pt;text-align:center'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13 Weeks Ended&nbsp;&nbsp;
  &nbsp;&nbsp;</font></p>
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  <td width=156 colspan=2 valign=top style='width:116.85pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:-5.4pt;text-align:center'><font style="font-size: 11.0pt">&nbsp; &nbsp;&nbsp;13 Weeks
  Ended&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid'>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=171 colspan=2 valign=top style='width:128.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <h4 style='mso-style-link:"Heading 4 Char";margin-top:0in;margin-right:-5.4pt;margin-bottom:0in;margin-left:-.9pt;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:0in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;October 29,
  2016&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</h4>
  </td>
  <td width=156 colspan=2 valign=top style='width:116.85pt;padding:0in 5.4pt 0in 5.4pt'>
  <h4 style='mso-style-link:"Heading 4 Char";margin-top:0in;margin-right:-5.4pt;margin-bottom:0in;margin-left:-.9pt;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:0in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;October 31,
  2015&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</h4>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'>&nbsp;</p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></u></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">% to</font></p>
  <h1 style='mso-style-link:"Heading 1 Char";margin:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;'>Net sales</h1>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'>&nbsp;</p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></u></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">% to</font></p>
  <h1 style='mso-style-link:"Heading 1 Char";margin:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;'>Net sales</h1>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr style='height:4.0pt'>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Net
  sales.................................................................. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">$&nbsp; 5,626&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">$&nbsp; 5,874&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr style='height:15.75pt'>
  <td width=357 colspan=2 valign=bottom style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt;
  height:15.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">Cost of sales (Note 2)............................................... </font></p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt;
  height:15.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp; &nbsp;3,386&nbsp;</font></u></p>
  </td>
  <td width=84 valign=bottom style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt;
  height:15.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;60.2%</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:15.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp; &nbsp;3,537</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=bottom style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt;
  height:15.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;60.2%</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Gross
  margin............................................................ </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">2,240&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">39.8%&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">2,337&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">39.8%&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Selling,
  general and administrative expenses............... </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;(2,071)</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">(36.8%)</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;(1,968)</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">(33.5%)</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Impairments
  and other costs (Note 3)........................ </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;-</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">-</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;(111)</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">(1.9%)&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Settlement
  charges (Note 4)..................................... </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (62</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;(1.1%</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; -</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; -%</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>
	Operating income..................................................... </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">107&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">1.9%&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">258&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">4.4%&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Interest
  expense &#150; net.............................................. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (81</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;(80</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>Income before income taxes..................................... </p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">26&nbsp;</font></p>
  </td>
  <td width=84 valign=bottom style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">178&nbsp;</font></p>
  </td>
  <td width=73 valign=bottom style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>Federal, state and local income tax&nbsp;expense (Note 5).. </p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (11</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=84 valign=bottom style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp; (61</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=73 valign=bottom style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Net
  income.............................................................. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp; &nbsp;15&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp; &nbsp;117&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Net
  loss attributable to non-controlling interest............ </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp; 2</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp; &nbsp;1</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Net
  income attributable to Macy's, Inc. shareholders.. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;118</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>Basic earnings per share attributable to </p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";margin-left:.25in'>Macy's, Inc. shareholders................................... </p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.05</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.36</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Diluted
  earnings per share attributable to</p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";text-indent:.25in;punctuation-wrap:hanging;
  text-autospace:ideograph-numeric ideograph-other'>Macy's, Inc. shareholders................................... </p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.05</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.36</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">Average common shares:</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic................................................................. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">308.4&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">325.3&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted............................................................... </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">310.6&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">329.7&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>End
  of period common shares outstanding.................. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">305.7&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">314.4&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 colspan=2 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=355 valign=top style='width:3.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Depreciation
  and amortization expense....................... </p>
  </td>
  <td width=89 colspan=2 valign=top style='width:66.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp; 267&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp; 271&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr height=0>
  <td width=354 style='border:none'></td>
  <td width=2 style='border:none'></td>
  <td width=87 style='border:none'></td>
  <td width=83 style='border:none'></td>
  <td width=85 style='border:none'></td>
  <td width=73 style='border:none'></td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">MACY'S, INC.</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">Consolidated Statements of Income (Unaudited)</font></u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='mso-style-link:"Body Text 3 Char";margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";'>Notes:</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;text-indent:
-.25in'><font style="font-size: 11.0pt">(1)&nbsp;&nbsp;Because of the seasonal nature of
the retail business, the results of operations for the 13 weeks ended October
29, 2016 and October 31, 2015 (which do not include the Christmas season) are
not necessarily indicative of such results for the fiscal year.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;text-indent:
-.25in'><font style="font-size: 11.0pt">(2)&nbsp;&nbsp;Merchandise inventories are valued
at the lower of cost or market using the last-in, first-out (LIFO) retail
inventory method. Application of the LIFO retail inventory method did not
result in the recognition of any LIFO charges or credits affecting cost of
sales for the 13 weeks ended October 29, 2016 or October 31, 2015.</font></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:0in'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;text-indent:
-.25in'><font style="font-size: 11.0pt">(3)&nbsp;&nbsp;The Company recognized charges of $111 million on a pre-tax basis, or $68 million after
tax or $.20 per diluted share attributable to Macy's, Inc., in the 13 weeks
ended October 31, 2015 that primarily related to asset impairments associated
with store closings.&nbsp;
</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;text-indent:
-.25in'><font style="font-size: 11.0pt">(4)&nbsp;&nbsp;Non-cash settlement charges of $62
million on a pre-tax basis, or $37 million after tax or $.12 per diluted share attributable
to Macy's, Inc., were recognized in the 13 weeks ended October 29, 2016.&nbsp; These
charges relate to the pro-rata recognition of net actuarial losses associated
with the Company&#146;s defined benefit retirement plans and are the result of an
increase in lump sum distributions associated with store closings, a voluntary
separation program, organizational restructuring, and periodic distribution
activity.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;text-indent:
-.25in'><font style="font-size: 11.0pt">(5)&nbsp;&nbsp;Federal, state and local income
taxes differ from the federal income tax statutory rate of 35%, principally
because of the effect of state and local taxes, including the settlement of
various tax issues and tax examinations.
</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">MACY'S, INC.</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">Consolidated Statements of Income (Unaudited) (Note 1)</font></u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">(All amounts in millions except percentages and per
share figures)</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=684
 style='width:512.7pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=171 colspan=2 valign=top style='width:128.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:-5.4pt;text-align:center'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 39 Weeks Ended&nbsp;&nbsp;
  &nbsp;&nbsp;</font></p>
  </td>
  <td width=156 colspan=2 valign=top style='width:116.85pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:-5.4pt;text-align:center'><font style="font-size: 11.0pt">&nbsp; &nbsp;&nbsp;39 Weeks
  Ended&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid'>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=171 colspan=2 valign=top style='width:128.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <h4 style='mso-style-link:"Heading 4 Char";margin-top:0in;margin-right:-5.4pt;margin-bottom:0in;margin-left:-.9pt;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:0in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;October 29,
  2016&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</h4>
  </td>
  <td width=156 colspan=2 valign=top style='width:116.85pt;padding:0in 5.4pt 0in 5.4pt'>
  <h4 style='mso-style-link:"Heading 4 Char";margin-top:0in;margin-right:-5.4pt;margin-bottom:0in;margin-left:-.9pt;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:0in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;October 31,
  2015&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</h4>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'>&nbsp;</p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></u></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">% to</font></p>
  <h1 style='mso-style-link:"Heading 1 Char";margin:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;'>Net sales</h1>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'>&nbsp;</p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></u></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">% to</font></p>
  <h1 style='mso-style-link:"Heading 1 Char";margin:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;'>Net sales</h1>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr style='height:4.0pt'>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Net
  sales.................................................................. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">$ 17,263&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">$ 18,210&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr style='height:15.75pt'>
  <td width=357 valign=bottom style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt;
  height:15.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">Cost of sales (Note 2)............................................... </font></p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt;
  height:15.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp; 10,370</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=bottom style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt;
  height:15.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;60.1%</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:15.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp; 10,947</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=bottom style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt;
  height:15.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;60.1%</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>
	Gross margin............................................................ </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">6,893&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">39.9%&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">7,263&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">39.9%&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Selling,
  general and administrative expenses............... </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;(6,063)</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">(35.1%)</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;(6,049)</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">(33.2%)</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>
	Impairments and other costs (Note 3)........................ </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;(249)</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">(1.4%)</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;(111)&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:6.15pt;text-align:right'><font style="font-size: 11.0pt">(0.6%)</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Settlement
  charges (Note 4)...................................... </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (81</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;(0.5%</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; -</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; -%</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Operating
  income..................................................... </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">500&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">2.9%&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">1,103&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">6.1%&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Interest
  expense &#150; net.............................................. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp; &nbsp;&nbsp; (276</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp; &nbsp;&nbsp; (268</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>Income before income taxes.....................................</p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">224&nbsp;</font></p>
  </td>
  <td width=84 valign=bottom style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">835&nbsp;</font></p>
  </td>
  <td width=73 valign=bottom style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>Federal, state and local income tax&nbsp;expense (Note 5).. </p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (85</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=84 valign=bottom style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp; (308</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=73 valign=bottom style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Net
  income.............................................................. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp; &nbsp;139&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp; &nbsp;527&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Net
  loss attributable to non-controlling interest............ </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp; 5</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp; &nbsp;1</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Net
  income attributable to Macy's, Inc. shareholders.. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp; &nbsp;144</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp; &nbsp;528</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>Basic earnings per share attributable to </p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";margin-left:.25in'>Macy's, Inc. shareholders................................... </p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.46</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;1.58</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Diluted
  earnings per share attributable to</p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";text-indent:.25in;punctuation-wrap:hanging;
  text-autospace:ideograph-numeric ideograph-other'>Macy's, Inc. shareholders.................................. </p>
  </td>
  <td width=87 valign=bottom style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.46</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=bottom style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;1.56</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">Average common shares:</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic................................................................ </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">309.5&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">333.9&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted.............................................................. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">311.8&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">339.0&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>End
  of period common shares outstanding................. </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">305.7&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">314.4&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=357 valign=top style='width:267.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Depreciation
  and amortization expense...................... </p>
  </td>
  <td width=87 valign=top style='width:65.55pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp; 787&nbsp;</font></p>
  </td>
  <td width=84 valign=top style='width:62.7pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'>&nbsp;</p>
  </td>
  <td width=83 valign=top style='width:62.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:8.1pt;text-align:right'><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp; 791&nbsp;</font></p>
  </td>
  <td width=73 valign=top style='width:54.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">MACY'S, INC.</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">Consolidated Statements of Income (Unaudited)</font></u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='mso-style-link:"Body Text 3 Char";margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";'>Notes:</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;
text-indent:-.25in'><font style="font-size: 11.0pt">(1)&nbsp;&nbsp;Because of the seasonal nature of
the retail business, the results of operations for the 39 weeks ended October
29, 2016 and October 31, 2015 (which do not include the Christmas season) are
not necessarily indicative of such results for the fiscal year.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;text-indent:
-.25in'><font style="font-size: 11.0pt">(2)&nbsp;&nbsp;Merchandise inventories are valued
at the lower of cost or market using the last-in, first-out (LIFO) retail
inventory method. Application of the LIFO retail inventory method did not
result in the recognition of any LIFO charges or credits affecting cost of
sales for the 39 weeks ended October 29, 2016 or October 31, 2015.</font></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;text-indent:
-.25in'><font style="font-size: 11.0pt">(3)&nbsp;&nbsp;The Company recognized charges of $249 million on a pre-tax basis, or $152 million after
tax or $.49 per diluted share attributable to Macy's, Inc., in the 39 weeks
ended October 29, 2016 that relate primarily to asset impairments associated
with anticipated store closings.&nbsp; Similar charges recognized in the 39
weeks ended October 31, 2015 were $111 million on a
pre-tax basis, or $68 million after tax or $.20 per diluted share attributable
to Macy's, Inc.
</font></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;text-indent:
-.25in'><font style="font-size: 11.0pt">(4)&nbsp;&nbsp;Non-cash settlement charges of $81
million on a pre-tax basis, or $50 million after tax or $.16 per diluted share
attributable to Macy's, Inc., were recognized in the 39 weeks ended October 29,
2016.&nbsp; These charges relate to the pro-rata recognition of net actuarial losses
associated with the Company&#146;s defined benefit retirement plans and are the
result of an increase in lump sum distributions associated with store closings,
a voluntary separation program, organizational restructuring, and periodic
distribution activity.</font></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;text-indent:
-.25in'><font style="font-size: 11.0pt">(5)&nbsp;&nbsp;Federal, state and local income
taxes differ from the federal income tax statutory rate of 35%, principally
because of the effect of state and local taxes, including the settlement of various
tax issues and tax examinations.
</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<b><br
clear=all style='page-break-before:always'>
</b>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">MACY'S, INC.</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">Consolidated Balance Sheets (Unaudited)</font></u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">(millions)</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 10.0pt">&nbsp;</font></p>

<table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0 width=650
 style='width:487.8pt;border-collapse:collapse;border:none'>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">&nbsp;&nbsp;October 29,</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">January 30,</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">&nbsp;October 31,</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2016&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></u></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2016&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></u></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2015&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></u></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">ASSETS:</font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Current
  Assets:</p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents................................. </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">$&nbsp; 457</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">$&nbsp; 1,109</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">$&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;474</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Receivables...................................................... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">262</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">558</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">200</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
	Merchandise inventories.................................... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">7,587</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">5,506</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">7,971</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Prepaid expenses and
  other current assets.......... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 454</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 479</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 426</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income tax receivable........................................ </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 60</font></u></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; - </font></u></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; - </font></u></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Current
  Assets...................................... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">8,820</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">7,652</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">9,071</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp; Property and Equipment
	-
  net............................... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">7,149</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">7,616</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">7,629</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp; Goodwill.............................................................. </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">3,897</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">3,897</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">3,897</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;
	Other Intangible Assets - net............................... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">499</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">514</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">518</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;
	Other Assets....................................................... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 909</font></u></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 897</font></u></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 768</font></u></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Assets.................................................. </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">$21,274</font></u></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">$20,576</font></u></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">$21,883</font></u></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">LIABILITIES AND
  SHAREHOLDERS' EQUITY:</font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp; Current Liabilities:</font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Short-term debt................................................ </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">$&nbsp; &nbsp;&nbsp;&nbsp;938</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">$&nbsp; &nbsp;&nbsp;&nbsp;642</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">$ &nbsp;&nbsp;&nbsp; 857</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Merchandise accounts
  payable.......................... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">3,375</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">1,526</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">3,608</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts payable and
  accrued liabilities............ </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">2,930</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">3,333</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">2,687</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income taxes................................................... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; -</font></u></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 227</font></u></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;102 </font></u></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Current
  Liabilities................................. </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">7,243</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">5,728</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">7,254</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp; Long-Term Debt................................................. </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">6,563</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">6,995</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">7,076</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp; Deferred Income Taxes......................................</font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">1,548</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">1,477</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">1,453</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp; Other Liabilities................................................... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">2,129</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">2,123</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">2,125</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:9.0pt'><font style="font-size: 11.0pt">Shareholders'
  Equity:</font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Macy's, Inc..................................................... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">3,789</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">4,250</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">3,971</font></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-controlling
  interest.................................... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2</font></u></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3</font></u></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4</font></u></p>
  </td>
 </tr>
 <tr>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  Shareholders' Equity............................ </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp; 3,791</font></u></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp; 4,253</font></u></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp; 3,975</font></u></p>
  </td>
 </tr>
 <tr style='height:4.0pt'>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr style='height:6.75pt'>
  <td width=371 valign=top style='width:278.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:6.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Liabilities
  and Shareholders' Equity....... </font></p>
  </td>
  <td width=92 valign=top style='width:69.35pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:6.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">$21,274</font></u></p>
  </td>
  <td width=92 valign=top style='width:68.65pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:6.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">$20,576</font></u></p>
  </td>
  <td width=96 valign=top style='width:71.8pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:6.75pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:9.2pt;text-align:right'><u><font style="font-size: 11.0pt">$21,883</font></u></p>
  </td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";'><b>&nbsp;</b></p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";'>&nbsp;</p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";'>Note: Certain
reclassifications were made to prior year&#146;s amounts to conform with the
classifications of such amounts in the most recent years.</p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";'><b>&nbsp;</b></p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";text-align:center'><b>&nbsp;</b></p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";text-align:center'><b>&nbsp;</b></p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";text-align:center'><b>&nbsp;</b></p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";text-align:center'><b>&nbsp;</b></p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";text-align:center'><b>&nbsp;</b></p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";text-align:center'><b>&nbsp;</b></p>

<b><br
clear=all style='page-break-before:always'>
</b>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";text-align:center'><b>MACY'S, INC.</b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">Consolidated Statements of Cash Flows (Unaudited)</font></u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">(millions)<br>
<br>
</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=643
 style='width:6.7in;border-collapse:collapse'>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:0in;text-align:center'>39 Weeks Ended</h2>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;text-align:center'><font style="font-size: 11.0pt">October
  29, 2016&nbsp;&nbsp;&nbsp; </font></h3>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:0in;text-align:center'>39 Weeks Ended</h2>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;text-align:center'><font style="font-size: 11.0pt">October
  31, 2015</font></h3>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Cash
  flows from operating activities:</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Net income.................................................................. </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;139&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;527&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Adjustments
  to reconcile net income to net cash<br>
  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;provided by operating activities:</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Impairments and
  other costs.................................... </font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">249&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">111&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Settlement charges.................................................. </font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">81&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">-&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation and
  amortization..................................</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">787&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">791&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock-based compensation expense..........................</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">56&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">65&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Amortization of
  financing costs and premium on </font></p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;acquired
  debt........................................................ </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(14)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(14)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes
  in assets and liabilities:</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;Decrease
  in receivables....................................... </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">237&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">226&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp; &nbsp;Increase
  in merchandise inventories......................</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">(2,081)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">(2,525)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";margin-right:-9.9pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;Increase in
  prepaid expenses and other current assets. </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(37)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(36)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";margin-right:-5.4pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;Increase in
  other assets not separately identified.... </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(1)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(1)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
	&nbsp;Increase in merchandise accounts payable.............</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">1,665&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">1,773&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;Decrease in accounts payable, accrued
  liabilities</p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; and other items not separately
  identified............</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(482)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(385)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;Decrease
  in current income taxes..........................</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(287)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(194)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
	&nbsp;Increase (decrease) in deferred income taxes......... </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">45&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(21)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;Decrease
  in other liabilities not separately identified&nbsp;&nbsp; </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (49</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(39</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>
	&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by operating activities............. </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; 308</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp; &nbsp;&nbsp;278</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">Cash flows from investing
  activities:</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Purchase
  of property and equipment............................... </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(451)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(591)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Capitalized
  software...................................................... </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(230)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(249)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Acquisition
  of Bluemercury, Inc., net of cash acquired.....</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">-&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">(212)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Disposition
  of property and equipment............................. </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">138&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 94&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Other,&nbsp;
	net.................................................................... &nbsp;&nbsp; </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;52</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><u><font style="font-size: 11.0pt">&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;97</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net
  cash used by investing activities................... </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp; (491</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp; &nbsp;(861</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'>&nbsp;</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'><br clear=all
  style='page-break-before:always'>

  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">Cash flows from financing
  activities:</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'>&nbsp;</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:.25in;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Debt
  issued................................................................... </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">54&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">791&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;
	Financing costs............................................................. </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">(3)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">-&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Debt
  repaid.................................................................. </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">(174)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">(152)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Dividends
  paid.............................................................. </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">(344)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">(344)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Increase
  in outstanding checks...................................... </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">193&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">136&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Acquisition
  of treasury stock......................................... </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">(230)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">(1,785)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Issuance
  of common stock............................................ </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 31&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 160&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp; Proceeds
  from non-controlling interest........................... </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net
  cash used by financing activities..................</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(469</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;(1,189</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Net
  decrease in cash and cash equivalents........................ </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">(652)</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">(1,772)</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Cash
  and cash equivalents at beginning of period............... </p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp; 1,109</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp; 2,246</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr style='height:16.2pt'>
  <td width=391 valign=top style='width:293.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:16.2pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>Cash
  and cash equivalents at end of period....................... </p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:16.2pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;457</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:16.2pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:17.1pt;text-align:right'><u><font style="font-size: 11.0pt">$&nbsp;&nbsp;&nbsp;&nbsp;474</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";'>&nbsp;</p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";'>Note: Certain
reclassifications were made to prior year's amounts to conform with the
classifications of such amounts in the most recent years.</p>

<b><br
clear=all style='page-break-before:always'>
</b>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">MACY'S, INC.</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">Important Information Regarding Non-GAAP Financial
Measures</font></u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><font style="font-size: 11.0pt">The Company reports its financial results in
accordance with U.S. generally accepted accounting principles
(&quot;GAAP&quot;). However, management believes that certain non-GAAP
financial measures provide users of the Company's financial information with
additional useful information in evaluating operating performance. Management
believes that providing changes in comparable sales on an owned plus licensed
basis, which includes the impact of growth in comparable sales of departments
licensed to third parties supplementally to its results of operations
calculated in accordance with GAAP assists in evaluating the Company's ability
to generate sales growth, whether through owned businesses or departments
licensed to third parties, on a comparable basis, and in evaluating the impact
of changes in the manner in which certain departments are operated.&nbsp; Management
believes that excluding certain items that may vary substantially in frequency
and magnitude from operating income and diluted earnings per share attributable
to Macy's, Inc. shareholders provides useful supplemental measures that assist
in evaluating the Company's ability to generate earnings and leverage sales and
to more readily compare these metrics between past and future periods. The
reconciliation of the forward-looking non-GAAP financial measure of changes in
comparable sales on an owned plus licensed basis to GAAP comparable sales
(i.e., on an owned basis) is in the same manner as illustrated below, where the
impact of growth in comparable sales of departments licensed to third parties
is the only reconciling item. In addition, the Company does not provide the
most directly comparable forward-looking GAAP measure of diluted earnings per
share attributable to Macy's, Inc. shareholders because the timing and amount
of excluded items (e.g., asset impairment charges, retirement settlement
charges and other store closing related costs) are unreasonably difficult to
fully and accurately estimate.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><font style="font-size: 11.0pt">Non-GAAP financial measures should be viewed as
supplementing, and not as an alternative or substitute for, the Company's
financial results prepared in accordance with GAAP. Certain of the items that
may be excluded or included in non-GAAP financial measures may be significant
items that could impact the Company's financial position, results of operations
and cash flows and should therefore be considered in assessing the Company's
actual and future financial condition and performance. Additionally, the
amounts received by the Company on account of sales of departments licensed to
third parties are limited to commissions received on such sales. The methods
used by the Company to calculate its non-GAAP financial measures may differ
significantly from methods used by other companies to compute similar measures.
As a result, any non-GAAP financial measures presented herein may not be
comparable to similar measures provided by other companies.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><font style="font-size: 11.0pt">&nbsp;</font></p>

<u><br
clear=all style='page-break-before:always'>
</u>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">MACY'S, INC.</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">Important Information Regarding Non-GAAP Financial
Measures</font></u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><u><font style="font-size: 11.0pt">Change in Comparable Sales </font></u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><font style="font-size: 11.0pt">The following is a reconciliation of the non-GAAP
financial measure of changes in comparable sales on an owned plus licensed
basis, to GAAP comparable sales (i.e., on an owned basis), which the Company
believes to be the most directly comparable GAAP financial measure.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><font style="font-size: 11.0pt">&nbsp;</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=781
 style='width:585.9pt;border-collapse:collapse'>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>13 Weeks </h2>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>Ended</h2>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'>October 29,&nbsp; </h3>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'><font style="font-size: 11.0pt">2016&nbsp; </font></h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>39 Weeks </h2>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>Ended</h2>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'>October 29,&nbsp; </h3>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'><font style="font-size: 11.0pt">2016&nbsp; </font></h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>&nbsp;</h2>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Decrease in comparable sales on an owned basis (Note 1)........ </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">(3.3%</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">(4.0%</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  &nbsp;</td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Impact of growth in comparable sales of departments</p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;licensed
  to third parties (Note 2)........................................ </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;0.6&nbsp;%</font></u></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">&nbsp;0.5&nbsp;%</font></u></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Decrease in comparable sales on an owned plus licensed
  basis </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">(2.7%</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">(3.5%</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">&nbsp;</font></b></p>

<p style='mso-style-link:"Body Text 3 Char";margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>

<p style='mso-style-link:"Body Text 3 Char";margin:0in;margin-bottom:.0001pt;font-size:10.0pt;font-family:"Times New Roman","serif";'>Notes:</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;
text-indent:-.25in'><font style="font-size: 11.0pt">(1)&nbsp;&nbsp;Represents the period-to-period
change in net sales from stores in operation throughout the year presented and
the immediately preceding year and all online sales, excluding commissions from
departments licensed to third parties.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:.25in;text-align:justify;
text-indent:-.25in'><font style="font-size: 11.0pt">(2)&nbsp;&nbsp;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 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 Company believes that the amounts of commissions earned on sales of
departments licensed to third parties are not material to its results of
operations for the periods presented.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'>&nbsp;</p>

<u><br
clear=all style='page-break-before:always'>
</u>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><b><font style="font-size: 11.0pt">MACY'S, INC.</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:center'><u><font style="font-size: 11.0pt">Important Information Regarding Non-GAAP Financial
Measures</font></u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><u><font style="font-size: 11.0pt">Diluted Earnings Per Share Attributable to Macy's,
Inc. Shareholders, Excluding Certain Items </font></u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><font style="font-size: 11.0pt">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><font style="font-size: 11.0pt">The following is a reconciliation of the non-GAAP
financial measure diluted earnings per share attributable to Macy's, Inc.
shareholders, excluding certain items, to GAAP diluted earnings per share
attributable to Macy's, Inc., shareholders, which the Company believes to be
the most directly comparable GAAP measure.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'><font style="font-size: 11.0pt">&nbsp;</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=661
 style='width:495.9pt;border-collapse:collapse'>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>13 Weeks </h2>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>Ended</h2>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'>October 29,&nbsp; </h3>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'><font style="font-size: 11.0pt">2016&nbsp; </font></h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>39 Weeks </h2>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>Ended</h2>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'>October 29,&nbsp; </h3>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'><font style="font-size: 11.0pt">2016&nbsp; </font></h3>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Diluted earnings per share attributable to </p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Macy's, Inc.
  shareholders................................................... </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">$0.05</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">$0.46</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Add back the pre-tax impact of impairments and other
  costs.... </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">-&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">0.80&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Add back the pre-tax impact of settlement charges.................. </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">0.20&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">0.26&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Deduct the income tax impact of impairments and </p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;other costs and
  settlement charges...................................... </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">(0.08</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">(0.41</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Diluted earnings per share attributable to </p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Macy's, Inc.
  shareholders, excluding impairments and </p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;other costs and
  settlement charges..................................... </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">$0.17</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">$1.11</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;text-autospace:none'>&nbsp;</p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";text-align:center'><b>&nbsp;</b></p>

<p style='mso-style-link:"Body Text 2 Char";margin:0in;margin-bottom:.0001pt;font-size:10.5pt;font-family:"Times New Roman","serif";'>&nbsp;</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=661
 style='width:495.9pt;border-collapse:collapse'>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>13 Weeks </h2>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>Ended</h2>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'>October 31,&nbsp; </h3>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'><font style="font-size: 11.0pt">2015&nbsp; </font></h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>39 Weeks </h2>
  <h2 style='mso-style-link:"Heading 2 Char";margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";font-weight:bold;text-decoration:underline;margin-left:12.6pt;text-align:center'>Ended</h2>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'>October 31,&nbsp; </h3>
  <h3 style='mso-style-link:"Heading 3 Char";margin:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:simple;text-autospace:none;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight:normal;text-decoration:underline;margin-left:12.6pt;text-align:center'><font style="font-size: 11.0pt">2015&nbsp; </font></h3>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Diluted earnings per share attributable to </p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Macy's, Inc.
  shareholders.................................................. </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">$0.36</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">$1.56</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Add back the pre-tax impact of impairments and other
  costs.... </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">0.33&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">0.33&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Deduct the income tax impact of impairments and other
  costs.. </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">(0.13</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">(0.13</font></u><font style="font-size: 11.0pt">)</font></p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'>&nbsp;</p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=421 valign=top style='width:315.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp; Diluted earnings per share attributable to </p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Macy's, Inc.
  shareholders, excluding impairments and </p>
  <p style='mso-style-link:"Header Char";margin:0in;margin-bottom:.0001pt;punctuation-wrap:simple;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman","serif";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;other costs........................................................................ </p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">$0.56</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
  <td width=120 valign=bottom style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right:12.6pt;text-align:right'><u><font style="font-size: 11.0pt">$1.76</font></u><font style="font-size: 11.0pt">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-bottom:5.75pt;text-indent:.5in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";'><b>&nbsp;</b></p>

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