CINCINNATI (AP) -- Despite a $59 million loss and a slump in sales in the first quarter, Macy's Inc. on Wednesday posted results that beat Wall Street expectations because of what analysts said were tight controls on expenses and inventories.

The loss resulted from lower sales and the cost of consolidating business units, Macy's said.

Losses totaled 14 cents a share in the three months ended May 3, compared with a profit of $36 million, or 8 cents a share, in the same quarter a year ago, Macy's said. Revenue was $5.75 billion, down from $5.92 billion a year ago.

Macy's booked a $55 million after-tax charge, or 13 cents a share, for the restructuring that the retailer said should start saving money next year. Macy's also set aside $14 million after tax, or 3 cents per share, for a potential settlement of a wage and hour class-action lawsuit in California.

Stripping out unusual charges, earnings from continuing operations were 2 cents a share, Macy's said.

Analysts polled by Thomson Financial forecast a loss of 2 cents a share on revenue of $5.6 billion. Analyst forecasts typically exclude one-time charges and gains.

Macy's shares rose 87 cents, or 3.6 percent, to $24.93 Wednesday. Shares have traded between $20.94 and $45.50 over the past 52 weeks.

Goldman Sachs analyst Adrianne Shapira said Macy's delivered the better-than-expected results "primarily as a result of leaner inventory levels and tight expense control."

Sales at stores opened at least a year -- considered a key indicator of a retailer's success -- fell 2.6 percent in the quarter but were not as bad as Kohl's Corp.'s 6.7 percent decrease and drops of 7.4 percent for J.C. Penney Co. and 6.5 percent for Nordstrom Inc.

Macy's has struggled with disappointing sales and resistance from shoppers in some markets where the Macy's name replaced local favorites after it bought department store operator May Department Stores Co. in 2005.

Liz Dunn, an analyst with Thomas Weisel Partners LLC, expects same-store sales to improve as the former May stores become more accustomed to the Macy's assortment and merchandise strategies.

Chief Financial Officer Karen Hoguet told analysts in a conference call that despite the decline in same-store sales, Macy's fared well in a difficult retail environment.

"This gives us comfort that the strategies we are executing are right, and that customers are responding well to our offerings," Hoguet said.

Sales in the quarter were stronger in the Northeast and in Texas, she said, but weaker on the West Coast and in Florida.

Women's apparel continued to be a tough category, while men's products did better, Hoguet said.

She said premium brands and Macy's private brands are selling well.

Macy's announced in February that it would combine three regional divisions and cut about 2,300 management jobs to better tailor individual stores to customer needs.

Hoguet said the consolidation was completed in the first quarter, and Macy's is beginning a new training regimen for the restructured company.

The company expects to book about $60 million in consolidation costs in the final three quarters.

Macy's reaffirmed earlier guidance, saying annual same-store sales should be in the range of down 1 percent to up 1.5 percent, with earnings per share of $1.85 to $2.15, excluding one-time costs.

Analysts are forecasting earnings of 18 cents per share on revenue of $5.7 billion in the second quarter and earnings of $1.88 per share on revenue of $25.7 billion for the year.

Hoguet said Macy's expects the economic environment to remain challenging at least through the third quarter.

"We will need earlier and also stronger recovery if we are to hit the upper end of this range," she said.

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