Macy

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billion shortfall in their pension plans, gaps that coulcd take years to close and pose an added threat totheir profits. The department store chaibn is shortroughly $1 billion, while Kroger’s pension plan is underfundesd by an estimated $550 million. As a both Cincinnati-based giants are making much larger contributions tothe Macy’s, for instance, will pay as much as $370 millioj into its underfunded pension plan this year more than three times what it contributed in 2008. Krogee in February made a voluntary paymentof $200 paying down its 2008 shortagse of $750 million (assumin g no other market losses).
But for which posted a 2008 profitrof $280 million (from $893 millioj in fiscal ’07), the ongoin g responsibility to make the plan full can be While Kroger’s products are necessities priced to Macy’s sells discretionary items that are far less recession-proof. As a it depends more heavily on the economu and a return to meaningful consumer spendingf to deliver the stock and bond performance to meet itspension obligation. Untilk that happens, Macy’s coulf be making such payments into 2010and beyond.