Department store retailer Macy's Inc has lowered its full year earnings guidance after third quarter sales look set to be lower than expected.

The Cincinnati based retailer on Friday (10 October) said that "in light of the weakening economic environment and consumer confidence," it expects earnings per share of $1.30 to $1.50 for fiscal 2008 - down from previous guidance of $1.70 to $1.85 per share.

The revision comes after same-store sales fell by 5.8% in the third quarter to date (August and September combined), and were down by 3.2% in the eight months to September.

If weaker sales trends continue, same-store sales in the autumn season could be down by 3-6%, the company said, which compares with earlier guidance for same-store sales that would be flat to down 1%.

Despite lower sales, Macy's said it continues "to be financially healthy" and had $740m in cash and cash equivalents at the end of September. 

"We are continuing to manage our business well in this tough economic environment," said Terry J Lundgren, chairman, president and chief executive officer.

Macy's Inc operates more than 850 department stores under the names of Macy's and Bloomingdale's.