Costco and TJX beat estimates in September, Target misses
New York — Costco Wholesale Corp. reported a better-than-expected 6% rise in September same-store sales, helped by higher gasoline prices and a stronger dollar. Excluding the impact of gasoline prices and foreign exchange, comparable September same-store sales rose 5%.
Net sales rose 8% to $9.31 billion in the five weeks ended Sept. 30. Costco, which currently operates 608 warehouses, said it plans to open up to 14 new warehouses prior to the end of calendar year 2012.
Target Corp. said its same-store sales rose 2.1% in September, boosted by sales of back-to-school items and groceries. Analysts expected a 2.2% increase.
The chain’s total sales for the five weeks ended Sept. 29 rose 2.6% to $6.08 billion.
“Target’s comparable-store sales performance in September was in line with our guidance for the month," said Gregg Steinhafel, chairman, president and CEO of Target Corp. "We’re pleased with our sales results through the first two months of the quarter and believe we remain on-track to attain our third-quarter sales and profit goals."
The TJX Cos. reported that September same-store sales rose 6%, beating Wall Street predictions. The company said it would have raised its earnings outlook for the third quarter because of its strong September, but is leaving its guidance at 56 cents to 59 cents per share because it is taking a two-cent charge related to pension costs.
“We are particularly happy with business at TJX Europe, where comp sales increased 13%,” said TJX CEO Carol Meyrowitz. “Our results in Europe represent consistently good performance and an increasingly strong trend, which underscore our confidence in our European growth opportunity. It’s important to note that we ended the month with great momentum across the board, which bodes well for the rest of the fall as well as the 2012 holiday selling season, which we believe will be terrific for TJX!”
In other discounter results:
Ross Stores reported a 5% increase in same-store sales. Sales increased 10% to $800 million for the five weeks ended September 29, 2012, up from $726 million in sales for the five weeks ended October 1, 2011.
Michael Balmuth, vice chairman and CEO, commented: "We are pleased with same store sales gains in September that continued to outperform our expectations. The primary driver of our favorable business trends year-to-date remains our ongoing focus on delivering fresh and exciting assortments of name brand bargains that continue to resonate with today’s value-focused consumers."
Wet Seal urges rejection of Clinton proposal
FOOTHILL RANCH, Calif. — Teen retailer Wet Seal continues to urge its shareholders to reject efforts by Clinton Group to replace the company’s current experienced directors with Clinton Group’s hand-picked nominees who lack relevant experience.
“We believe that maintaining a degree of stability and continuity on our Board is critical as we approach the holiday season,” said Hal Kahn, chairman of the board of Wet Seal. “It is not in the best interests of the company and our shareholders to have an almost complete turnover of the Board on the eve of the fourth quarter. It would be extremely disruptive to our employees, customers and suppliers at a time when we are in the midst of implementing a return to our fast fashion strategy and beginning to gain traction in improving our performance.”
Clinton, which holds approximately 7% of Wet Seal, said the retailer backtracked on an offer, made via an investment banker, for four directors to resign in exchange for the activist investor ending its move, according to a Reuters report.
Clinton has argued that Wet Seal’s performance over the last five years has been unnecessarily poor, and that the board has made missteps in its hiring and strategy.
Wet Seal on Tuesday reported a 12.7% decline in September same-store sales. Clinton has argued that Wet Seal’s performance over the last five years has been unnecessarily poor, and that the board has made missteps in its hiring and strategy, Reuters said.
Barnes & Noble, Microsoft seal Nook deal
NEW YORK & REDMOND, Wash. — Barnes & Noble and Microsoft have completed their previously announced strategic partnership in Nook Media LLC, a recently formed Barnes & Noble subsidiary and a leader in the emerging digital reading and digital education markets.
Nook Media LLC comprises the digital and college businesses of Barnes & Noble and will continue to have a very close and mutually beneficial relationship with Barnes & Noble’s retail stores, the companies said. The partnership includes a $300 million investment from Microsoft in Nook Media LLC.
“As demand for digital content continues to increase, we are focused on bringing ground-breaking reading and learning content and technologies to more people in more formats than ever before, including the imminent launch of our exceptional Nook reading application for Windows 8,” said William Lynch, CEO of Barnes & Noble. “We look forward to working closely with our new partner Microsoft to add value to their innovative new platform by bringing great reading experiences and one of the world’s preeminent digital bookstores to millions of Windows 8 users.”