New York Retailers posted mixed June sales on Thursday as a boost from hot weather-induced buying and a shift in the timing of Memorial Day sales was offset by continuing economic uncertainty and a drop in consumer confidence.
June is traditionally a time when stores clear out summer goods to make room for back-to-school merchandise. But analysts say discounting was heavier than expected this year as stores struggled to attract still-cautious consumers.
Clothing stores accelerated discounting toward the end of June after not getting enough business, BMO Capital Markets analyst John Morris said, in an Associated Press report. He estimated that volume and level of discounts at the mall-based apparel chains he tracks was even with a year ago even as stores carry less inventory than a year ago.
Gap Inc. said Thursday that its June same-store sales were flat with a year ago, after it suffered a 10% drop, Analysts, on average, had expected same-store sales to rise 3.4%,
Overall revenue climbed 2% to $1.31 billion, up from $1.29 billion last year.
"June was a difficult month with lighter traffic than we anticipated," Sabrina Simmons, Gap's chief financial officer, said in a statement.
But there were bright spots. At Aeropostale Inc., June same-store sales rose 8% , beating analysts' expectations. Total sales for the period increased 14% to $186.8 million for the five-week period ended July 4.
The company said the later Memorial Day helped June's results. It also said its margins continued to rise from a year earlier and its inventories are well positioned for the back-to-school season.
At Abercrombie & Fitch, same-store sales rose 9%, easily ahead of analysts' expectations. The figure rose 10% at namesake stores, 14% at Abercrombie children's stores and 7% at Hollister stores. Total revenue rose 23% to $277.3 million in the five-week period that ended July 3.
Limited Brands, which operates Victoria's Secret and Bath and Body Works, said it posted a 6% increase, better than forecasts. Total revenue for the five weeks ended July 3 rose 8% to $965.4 million from $891.8 million last year.
In other apparel retail June same-store sales results:
• Wet Seal had a 3.6% drop, and the company said it now expects second-quarter results at the low end of its previous guidance. Analysts had expected a smaller drop. •At Destination Maternity Corp., same-store sales fell 2.2%. •The Buckle suffered a 7.3% drop, much worse than analysts expected. •Hot Topic Inc. posted a 2.1% decline in June, better than the 5.4% drop analysts had expected. *American Eagle Outfitters’ sales fell 1%, worse then analysts had expected.