updated 5/10/2006 2:31:38 PM ET 2006-05-10T18:31:38

Federated Department Stores Inc. reported a loss Wednesday for its fiscal first quarter as the company booked charges to integrate its acquisition of May Department Stores. The company also forecast earnings below Wall Street expectations.

The operator of the Macy’s and Bloomingdale’s department store chains lost $52 million, or 19 cents per share, in the quarter ended April 29 compared with a profit of $123 million, or 71 cents per share, a year ago.

Sales jumped 63 percent to $5.93 billion from $3.64 billion a year ago. The company had forecast sales between $5.75 billion and $6 billion.

Federated bought former rival May last year, adding the Lord & Taylor and Filene’s chains, among others, to its department store group.

It said it lost 27 cents per share from continuing operations. The Lord & Taylor and Bridal Group units are on the block and were accounted as discontinued operations.

Terry J. Lundgren, Federated’s chairman, president and CEO, said 2006 is a transition year for the company and that the results show the integration of May into Federated is on track.

“Considering this was the initial quarter of physically bringing together the Federated and May Company organizations, we were very pleased with first quarter results that were ahead of our expectations,” Lundgren said in a statement.

Excluding related one-time charges of $81 million, or 29 cents per share, the company earned 2 cents per share from continuing operations, beating its own guidance for a loss of 5 cents to 15 cents per share.

The company said its continuing operations results were better than it had expected due to a sharp increase in sales at stores open at least a year — considered a major indicator of a retailer’s success — at Macy’s and Bloomingdale’s.

Federated anticipates second-quarter earnings of 45 cents to 55 cents per share, excluding items, on a projected same-store sales increase of 3 percent to 5 percent. Analysts surveyed by Thomson Financial expected 59 cents per share.

For the second half of the year, the company anticipates adjusted earnings between $3 and $3.25 per share, on its way to projected full-year income between $3.50 and $3.75 per share. Those forecasts exclude items. Analysts had forecast a profit of $4.16 per share for the year.

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