American Eagle Outfitters Lowers Expectations
Warrendale, Pa., American Eagle Outfitters pointed to lower-than-expected business trends and downgraded expectations for third-quarter earnings. The retailer now expects to earn $0.43 to $0.44 per share, compared to earnings per share of $0.39 from continuing operations in the third quarter of last year. The company’s previous third-quarter earnings guidance was $0.45 to $0.46 per share.
Comp store sales month-to-date through Sept. 19th are up approximately 11%.
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Report Expects e-Commerce Growth
Cambridge, Mass., As on-line technology continues to flourish, so too will on-line retail sales burgeon. According to Forrester Research, the $172 billion in U.S. on-line retail sales in 2005 will nearly double to $329 billion by 2010.
The 14% compound annual increase of e-commerce mainly can be attributed to retailers’ new approaches to on-line consumers. Rather that seeing on-line stores as a low-cost supplement, retailers now view the e-commerce as a channel to improve customer service and retention.
Several top retailers reflect this growing trend of on-line promotion and improved consumer relations, among them Target, Gap and Nike.
Tesco Team Eyes Albertson’s
London, Reuters reported that Tesco, Britain’s most prominent retailer, sent representatives stateside to consider a bid for Albertson’s, one of America’s top grocery chains.
Despite having 2,500 stores and annual revenues of more than $40 billion, Albertson’s has been facing intense competition from retail powerhouse Wal-Mart. As a result, the grocery chain recently hired investment bankers in order to explore its options on the market.
With a reported price tag of $7.6 billion, Albertson’s seems to have caught Tesco’s eye, at least momentarily. As the British retail giant reports half-year results this week, it continues to look for a way to tap the lucrative U.S. market. Tesco has already begun expanding into eastern Europe and east Asia.
In addition to Britain’s largest—and rapidly expanding—food retailer, France’s Carrefour and Belgium’s Delhaize have expressed interest in Albertson’s. The world’s largest retailer, Wal-Mart, is also courting the grocer.
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