Children’s Place Launches Review of Disney Stores
Secaucus, N.J. The Children’s Place Retail Stores Inc., which has seen its sales suffer because of lagging growth at Disney stores, has hired a consultant to review potential options for the brand, according to Crain’s New York. The company also said that it hired an unnamed consultant to review options for Disney stores.
But a pricey licensing deal could make it difficult for the Children’s Place to do much, the report added. Under a long-term agreement, the retailer must invest $175 million to remodel 234 Disney stores over the next five years, a big promise from a company that reported a 70% drop in third-quarter profits in November.
In August, Children’s Place said it was unable to meet “several” of the remodeling deadlines, and sought a postponement of some of its obligations from Disney, the report said.
GameStop holiday strong, raises 4Q outlook
GRAPEVINE, Texas GameStop announced today that it is raising its fourth quarter 2007 comparable-store sales and earning guidance following a strong holiday period.
The company reported that it is raising its fourth quarter 2007 comparable-store guidance from a range of 7% to 9%, to a range of 15.5% to 16.5%. Full year comparable-store sales are now expected to be in a range of 23.5% to 24.5%. The company expects fourth quarter diluted earnings per share guidance to be in a range of $1.09 to $1.10. Full year earnings per diluted share guidance is now forecast to be in a range of $1.75 to $1.76, which is 13 cents per share higher than guidance issued on Nov. 20.
For the nine-week holiday period ending Jan. 5, the GameStop reported total sales of $2.3 billion, a 34.7% increase from the prior year holiday period of $1.7 billion. Comparable-store sales for the holiday period increased 20%.
Richard Fontaine, chairman and ceo, commented, “Driven by robust domestic and international sales, GameStop achieved the most successful holiday season results ever. Video game software sales grew by 45%, while the next generation installed base is now triple last year’s base and a very positive leading indicator for future sales growth.”
Wal-Mart exceeds Dec. comps guidance
BENTONVILLE, Ark. Wal-Mart citied strength in its pharmacy, grocery and electronics businesses as key drivers of a 2.6% increase in December same store sales.
That figure was at the upper end of the company’s guidance of a 1% to 3% increase and exceeded analysts’ estimates of 1.8% increase.
Total sales for the Wal-Mart’s U.S. stores division increased 5.6% to $29.7 billion during the five-week December reporting period ended January 4.
“Wal-Mart’s food performance was very strong, which helped drive traffic to other areas of the stores,” said Eduardo Castro-Wright, president and ceo of Wal-Mart Stores U.S. “Our price leadership position was clear very early in the holiday season and customers responded throughout the period to our pricing and merchandise offerings which were support by well-integrated advertising and in-store communication.”
Faster, friendlier checkouts and an overall improvement to the in-store experience also contributed to the results, according to Castro-Wright.
“Within the food category, products related to entertaining and holiday baking performed well. Electronics was strong across the board. In apparel, sales were strong in seasonal and licensed items,” Castro-Wright said.
The company said it Sam’s Club division continued to perform well as it posted a 1.3% same store sales increase. Total sales increased 4.3% to $4.9 billion. The international division saw the largest increase as sales advanced 18.2% to nearly $12 billion.
Wal-Mart maintained it previously states guidance of fourth quarter earnings per share between 99 cents and $1.03.