Condensed Consolidating Financial Information

Certain debt obligations of the Company, which constitute debt obligations of Macy's Retail Holdings, Inc. ("Subsidiary Issuer"), a 100%-owned subsidiary of Macy's, Inc. ("Parent"), are fully and unconditionally guaranteed by Parent. In the following condensed consolidating financial statements, "Other Subsidiaries" includes all other direct subsidiaries of Parent, including FDS Bank, West 34th Street Insurance Company and its subsidiary West 34th Street Insurance Company New York, Macy's Merchandising Corporation, Macy's Merchandising Group, Inc. and its subsidiaries Macy's Merchandising Group (Hong Kong) Limited, Macy's Merchandising Group Procurement, LLC, Macy's Merchandising Group International, LLC, and Macy's Merchandising Group International (Hong Kong) Limited. "Subsidiary Issuer" includes operating divisions and non-guarantor subsidiaries of the Subsidiary Issuer on an equity basis. The assets and liabilities and results of operations of the non-guarantor subsidiaries of the Subsidiary Issuer are also reflected in "Other Subsidiaries."

Condensed Consolidating Balance Sheets as of May 2, 2015, May 3, 2014 and January 31, 2015, the related Condensed Consolidating Statements of Comprehensive Income for the 13 weeks ended May 2, 2015 and May 3, 2014, and the related Condensed Consolidating Statements of Cash Flows for the 13 weeks ended May 2, 2015 and May 3, 2014 are presented on the following pages.

Condensed Consolidating Balance Sheet

As of May 2, 2015

(millions)



	Parent		Subsidiary Issuer		Other Subsidiaries		Consolidating Adjustments			Consolidated
ASSETS:
Current Assets:
Cash and cash equivalents	$	1,078	$	115	$	316	$	—		$	1,509
Receivables	—		48		211		—			259
Merchandise inventories	—		3,029		3,026		—			6,055
Prepaid expenses and other current assets	—		101		370		—			471
Income taxes	43		—		—		(43		)	—
Total Current Assets	1,121		3,293		3,923		(43		)	8,294
Property and Equipment – net	—		4,250		3,462		—			7,712
Goodwill	—		3,315		582		—			3,897
Other Intangible Assets – net	—		68		463		—			531
Other Assets	1		75		665		—			741
Deferred Income Taxes	22		—		—		(22		)	—
Intercompany Receivable	—		—		3,588		(3,588		)	—
Investment in Subsidiaries	4,701		3,549		—		(8,250		)	—
Total Assets	$	5,845	$	14,550	$	12,683	$	(11,903	)	$	21,175
LIABILITIES AND SHAREHOLDERS’ EQUITY:
Current Liabilities:
Short-term debt	$	—	$	75	$	1	$	—		$	76
Merchandise accounts payable	—		1,207		1,305		—			2,512
Accounts payable and accrued liabilities	13		1,043		1,355		—			2,411
Income taxes	—		10		107		(43		)	74
Deferred income taxes	—		304		66		—			370
Total Current Liabilities	13		2,639		2,834		(43		)	5,443
Long-Term Debt	—		7,240		20		—			7,260
Intercompany Payable	564		3,024				(3,588		)	—
Deferred Income Taxes	—		440		668		(22		)	1,086
Other Liabilities	61		543		1,575		—			2,179
Shareholders' Equity	5,207		664		7,586		(8,250		)	5,207
Total Liabilities and Shareholders' Equity	$	5,845	$	14,550	$	12,683	$	(11,903	)	$	21,175

Condensed Consolidating Statement of Comprehensive Income

For the 13 Weeks Ended May 2, 2015

(millions)



	Parent			Subsidiary Issuer			Other Subsidiaries			Consolidating Adjustments			Consolidated
Net sales	$	—		$	2,776		$	5,691		$	(2,235	)	$	6,232
Cost of sales	—			(1,809		)	(4,226		)	2,235			(3,800		)
Gross margin	—			967			1,465			—			2,432
Selling, general and administrative expenses	(1		)	(980		)	(1,042		)	—			(2,023		)
Operating income (loss)	(1		)	(13		)	423			—			409
Interest (expense) income, net:
External	—			(95		)	—			—			(95		)
Intercompany	—			(58		)	58			—			—
Equity in earnings of subsidiaries	194			60			—			(254		)	—
Income (loss) before income taxes	193			(106		)	481			(254		)	314
Federal, state and local income tax benefit (expense)	—			37			(158		)	—			(121		)
Net income (loss)	$	193		$	(69	)	$	323		$	(254	)	$	193
Comprehensive income (loss)	$	201		$	(61	)	$	327		$	(266	)	$	201

Condensed Consolidating Statement of Cash Flows

For the 13 Weeks Ended May 2, 2015

(millions)



	Parent			Subsidiary Issuer			Other Subsidiaries			Consolidating Adjustments			Consolidated
Cash flows from operating activities:
Net income (loss)	$	193		$	(69	)	$	323		$	(254	)	$	193
Equity in earnings of subsidiaries	(194		)	(60		)	—			254			—
Dividends received from subsidiaries	191						—			(191		)	—
Depreciation and amortization	—			106			153			—			259
(Increase) decrease in working capital	43			16			(461		)	—			(402		)
Other, net	24			(6		)	(15		)	—			3
Net cash provided (used) by operating activities	257			(13		)	—			(191		)	53
Cash flows from investing activities:
Purchase of property and equipment and capitalized software, net	—			(69		)	(170		)	—			(239		)
Other, net	—			7			(149		)	—			(142		)
Net cash used by investing activities	—			(62		)	(319		)	—			(381		)
Cash flows from financing activities:
Debt repaid	—			(3		)	—			—			(3		)
Dividends paid	(106		)	—			(191		)	191			(106		)
Common stock acquired, net of issuance of common stock	(259		)	—			—			—			(259		)
Intercompany activity, net	(669		)	146			523			—			—
Other, net	(53		)	(47		)	59			—			(41		)
Net cash provided (used) by financing activities	(1,087		)	96			391			191			(409		)
Net increase (decrease) in cash and cash equivalents	(830		)	21			72			—			(737		)
Cash and cash equivalents at beginning of period	1,908			94			244			—			2,246
Cash and cash equivalents at end of period	$	1,078		$	115		$	316		$	—		$	1,509

Condensed Consolidating Balance Sheet

As of May 3, 2014

(millions)



	Parent		Subsidiary Issuer		Other Subsidiaries		Consolidating Adjustments			Consolidated
ASSETS:
Current Assets:
Cash and cash equivalents	$	1,425	$	129	$	324	$	—		$	1,878
Receivables	—		58		217		—			275
Merchandise inventories	—		3,023		2,874		—			5,897
Prepaid expenses and other current assets	—		94		360		—			454
Income taxes	9		—		—		(9		)	—
Total Current Assets	1,434		3,304		3,775		(9		)	8,504
Property and Equipment – net	—		4,481		3,311		—			7,792
Goodwill	—		3,315		428		—			3,743
Other Intangible Assets – net	—		91		428		—			519
Other Assets	4		95		648		—			747
Deferred Income Taxes	20		—		—		(20		)	—
Intercompany Receivable	28		—		3,306		(3,334		)	—
Investment in Subsidiaries	4,687		3,225		—		(7,912		)	—
Total Assets	$	6,173	$	14,511	$	11,896	$	(11,275	)	$	21,305
LIABILITIES AND SHAREHOLDERS’ EQUITY:
Current Liabilities:
Short-term debt	$	—	$	6	$	2	$	—		$	8
Merchandise accounts payable	—		1,086		1,304		—			2,390
Accounts payable and accrued liabilities	7		980		1,233		—			2,220
Income taxes	—		36		78		(9		)	105
Deferred income taxes	—		301		80		—			381
Total Current Liabilities	7		2,409		2,697		(9		)	5,104
Long-Term Debt	—		7,141		21		—			7,162
Intercompany Payable	—		3,330		4		(3,334		)	—
Deferred Income Taxes	—		576		748		(20		)	1,304
Other Liabilities	66		489		1,080		—			1,635
Shareholders' Equity (Deficit)	6,100		566		7,346		(7,912		)	6,100
Total Liabilities and Shareholders' Equity	$	6,173	$	14,511	$	11,896	$	(11,275	)	$	21,305

Condensed Consolidating Statement of Comprehensive Income

For the 13 Weeks Ended May 3, 2014

(millions)



	Parent			Subsidiary Issuer			Other Subsidiaries			Consolidating Adjustments			Consolidated
Net sales	$	—		$	2,918		$	5,457		$	(2,096	)	$	6,279
Cost of sales	—			(1,886		)	(4,046		)	2,096			(3,836		)
Gross margin	—			1,032			1,411			—			2,443
Selling, general and administrative expenses	(2		)	(1,008		)	(990		)	—			(2,000		)
Operating income (loss)	(2		)	24			421			—			443
Interest (expense) income, net:
External	—			(100		)	—			—			(100		)
Intercompany	—			(58		)	58			—			—
Equity in earnings of subsidiaries	225			66			—			(291		)	—
Income (loss) before income taxes	223			(68		)	479			(291		)	343
Federal, state and local income tax benefit (expense)	1			38			(158		)	—			(119		)
Net income (loss)	$	224		$	(30	)	$	321		$	(291	)	$	224
Comprehensive income (loss)	$	228		$	(26	)	$	323		$	(297	)	$	228

Condensed Consolidating Statement of Cash Flows

For the 13 Weeks Ended May 3, 2014

(millions)



	Parent			Subsidiary Issuer			Other Subsidiaries			Consolidating Adjustments			Consolidated
Cash flows from operating activities:
Net income (loss)	$	224		$	(30	)	$	321		$	(291	)	$	224
Equity in earnings of subsidiaries	(225		)	(66		)	—			291			—
Dividends received from subsidiaries	167			—			—			(167		)	—
Depreciation and amortization	—			113			140			—			253
(Increase) decrease in working capital	87			(6		)	(377		)	—			(296		)
Other, net	5			(15		)	3			—			(7		)
Net cash provided (used) by operating activities	258			(4		)	87			(167		)	174
Cash flows from investing activities:
Purchase of property and equipment and capitalized software, net	—			(46		)	(144		)	—			(190		)
Other, net	—			1			5			—			6
Net cash used by investing activities	—			(45		)	(139		)	—			(184		)
Cash flows from financing activities:
Debt repaid	—			(4		)	(1		)	—			(5		)
Dividends paid	(92		)	—			(167		)	167			(92		)
Common stock acquired, net of issuance of common stock	(277		)	—			—			—			(277		)
Intercompany activity, net	(370		)	121			249			—			—
Other, net	(49		)	(23		)	61			—			(11		)
Net cash provided (used) by financing activities	(788		)	94			142			167			(385		)
Net increase (decrease) in cash and cash equivalents	(530		)	45			90			—			(395		)
Cash and cash equivalents at beginning of period	1,955			84			234			—			2,273
Cash and cash equivalents at end of period	$	1,425		$	129		$	324		$	—		$	1,878

Condensed Consolidating Balance Sheet

As of January 31, 2015

(millions)



	Parent		Subsidiary Issuer		Other Subsidiaries		Consolidating Adjustments			Consolidated
ASSETS:
Current Assets:
Cash and cash equivalents	$	1,908	$	94	$	244	$	—		$	2,246
Receivables	—		97		327		—			424
Merchandise inventories	—		2,817		2,699		—			5,516
Prepaid expenses and other current assets	—		113		380		—			493
Income taxes	88		—		—		(88		)	—
Total Current Assets	1,996		3,121		3,650		(88		)	8,679
Property and Equipment – net	—		4,315		3,485		—			7,800
Goodwill	—		3,315		428		—			3,743
Other Intangible Assets – net	—		73		423		—			496
Other Assets	1		74		668		—			743
Deferred Income Taxes	10		—		—		(10		)	—
Intercompany Receivable	—		—		4,140		(4,140		)	—
Investment in Subsidiaries	4,655		3,526		—		(8,181		)	—
Total Assets	$	6,662	$	14,424	$	12,794	$	(12,419	)	$	21,461
LIABILITIES AND SHAREHOLDERS’ EQUITY:
Current Liabilities:
Short-term debt	$	—	$	75	$	1	$	—		$	76
Merchandise accounts payable	—		784		909		—			1,693
Accounts payable and accrued liabilities	42		1,360		1,707		—			3,109
Income taxes	—		22		362		(88		)	296
Deferred income taxes	—		295		67		—			362
Total Current Liabilities	42		2,536		3,046		(88		)	5,536
Long-Term Debt	—		7,245		20		—			7,265
Intercompany Payable	1,215		2,925		—		(4,140		)	—
Deferred Income Taxes	—		414		677		(10		)	1,081
Other Liabilities	27		593		1,581		—			2,201
Shareholders' Equity (Deficit)	5,378		711		7,470		(8,181		)	5,378
Total Liabilities and Shareholders' Equity	$	6,662	$	14,424	$	12,794	$	(12,419	)	$	21,461