Abercrombie’s Same-Store Sales Slide 14%
New Albany, Ohio Abercrombie & Fitch Co. said Thursday that its September same-store sales dropped 14%, more than quadruple the drop Wall Street expected.
The chain warned that earnings for the second half of its fiscal year will likely come in well below prior forecasts due to continued economic difficulties and declining consumer confidence. But Abercrombie chief executive and chairman Mike Jeffries said the business will continue to invest in international growth and avoid marking down merchandise.
Same-store sales fell 7% at the retailer’s flagship banner, while same-store sales at the chain’s children’s concept, Abercrombie, slid 20%. Same-store sales at its surf-inspired brand, Hollister, dropped 20%. Its new format, Ruehl, aimed at young adults, posted a 24% decline in same-store sales.
Total sales for the period ended Oct. 4 slipped 7% to $275.4 million from $297.4 million. For the year to date, same-store sales fell 6%. Total sales dipped 3% to $2.33 billion.
Wal-Mart posts strong comps across all divisions
Wal-Mart Stores reported September net sales for the five weeks ended Oct. 3 of $36.23 billion, a 5.8% increase over $34.23 billion in September 2007. Walmart U.S. posted net sales of $22.48 billion, a 4.8% increase over $21.45 billion in September 2007; Sam’s Club had net sales of $4.39 billion, an 8% increase over $4.07 billion in 2007; and International net sales were $9.36 billion, a 7.3% boost over $8.72 billion in September of 2007.
Total U.S. comparable-store sales rose 2.4% without fuel, versus a 1.4% rise in September 2007. Walmart U.S. comps rose 2%, compared to 0.8% in 2007, while Sam’s Club comparable-club sales rose 4.6%, compared to 4.4% in September 2007.
The net impact of Hurricanes Gustav, Hanna and Ike on total U.S. comparable-store and club sales was approximately negative 0.4 percentage points.
"In spite of both the impact from the hurricanes and the recent challenges to consumer confidence as a result of the economic environment, Walmart U.S. had another period of solid comparable-store sales performance," said Eduardo Castro-Wright, Walmart U.S. president and ceo. "We continue to believe that the strong Walmart value proposition is bringing more and more customers to our stores. We are confident that the customers will continue to shop with us as we enter the holiday season."
Comparable-store sales during the September period were strong in both grocery and health and wellness. Sales in grocery were led by food and consumables. Children’s clothing was positive during the September period, while sales of discretionary items were soft.
September sales at Sam’s Club were driven by strengths in fresh food, with produce leading the category. Within general merchandise, apparel sales were strong, while housewares, furniture, video games and electronics saw softer sales. Within electronics, LCD TVs and small electronic devices, such as GPS units and digital audio, performed well.
"Sam’s Club members continue to search for value in this economy," said Doug McMillon, Sam’s Club president and ceo. "Food and consumables, including fresh foods, are driving increases in comparable-club traffic and ticket. While discretionary items are under pressure, members are reacting positively to new items. Price is the primary focus, but newness and quality still matter to them."
The Company expects U.S. comparable-store sales for the October four-week period to be between 1% and 2%, said cfo Tom Schoewe. "The September period included two first-of-the-month paydays, which generally benefit sales," Schoewe said. "However, the October period this year contains no first-of-the-month payday, and that is accounted for in our estimate. We maintain our current estimate for earnings per share from continuing operations for the third quarter ending Oct. 31, to be in the range of 73 cents and 76 cents per share."
PacSun net sales drop 4% in Sept., 3Q
ANAHEIM, Calif. Pacific Sunwear of California reported net sales for the month of September, ended Oct. 4, of $91.2 million, a decrease of 4% from $95.1 million in September 2007. Same-store sales decreased 5%.
Net sales for the third quarter of 2008 were $254.3 million, a decrease of 4% from $265.1 million during the same period last year. Third-quarter same-store sales decreased 6%.
As a result of increased markdown activity, PacSun now expects fiscal 2008 third-quarter earnings to be at the low end of its previously announced earnings guidance range of 0 to 5 cents per diluted share.