Department Stores Report Soft Results for June
New York City, The nation’s department stores experienced weak sales in June. Category leader Macy’s Inc. continued to struggle as its same-store sales fell 2.7%. Analysts expected a 0.8% drop. Macy’s itself had expected same-store sales to be flat to down 2%.
“As expected, calendar distortions, lackluster traffic trends and pockets of consumer weakness weighed on June results,” said Morgan Stanley analyst Gregory Melich in a note to investors on Thursday. “Department stores were a relative source of weakness, positing a 2.5% same-store sales decline in June, 0.7% below consensus.”
Kohl’s Corp. said same-store sales fell 4.9% in June, while analysts expected a 2.4% drop. Dillard’s Inc. saw its same-store sales fall 1%. Analysts had predicted a 1.4% rise. Same-store sales at Gottschalks Inc. dropped 4.3% on softness in apparel and home categories.
J.C. Penney Co. said that same-store sales fell 1.5% in June but still beat analyst expectations. Total sales for the five weeks ended July 7 edged down 0.4% to $1.61 billion, from $1.62 billion last year. Children’s and women’s apparel and family footwear were the strongest sellers, while furniture and fine jewelry had weaker sales. Sales improved later in the month, J.C. Penney said.
In the high-end market, Nordstrom Inc. reported same-store sales rose 2%, beating analyst expectations of a 1.1% gain. Saks Inc., reported a 5.6% drop in same-store sales, a bigger drop than the 4.1% analysts predicted.
Lynch named president of Ann Taylor Factory
NEW YORK Ann Taylor Stores announced today that Brian Lynch, previously evp of Ann Taylor Factory, has been promoted to president of the division, effective immediately.
Lynch joined Ann Taylor in 2004 as senior vp of Ann Taylor Stores and was promoted to evp of Ann Taylor Factory in June 2006. Prior to Ann Taylor, Lynch held senior leadership positions at Gap Inc. and Walt Disney.
Commenting on the announcement, Ann Taylor president and ceo Kay Krill stated, “Brian has successfully evolved the Factory division into a profitable and rapidly growing concept for the company, and I could not be more pleased with the results he and his team have delivered. Brian will lead our new LOFT Factory concept, and I am confident that this business, which we are planning to launch in summer 2008, will flourish under his leadership.”
Bed Bath & Beyond grows other banners
UNION, N.J. Bed Bath & Beyond is looking increasingly like a portfolio retailer. Although still overwhelming consisting of namesake stores, the company, at its annual meeting, discussed plans for growth in its other banners including Christmas Tree Shops, Harmon and the newly acquired buybuy Baby. The company ended fiscal 2006 with 815 Bed Bath & Beyond units, 34 Christmas Tree Shops and 39 Harmon stores. Harmon also has been adapted as a boutique health and beauty aids section in Bed Bath & Beyond stores.
By March 3, Bed Bath & Beyond had secured 58 leases for new stores sites in 2007 and into 2008. While most will be Bed Bath & Beyond units, the company stated that it intends to grow all four of its banners in the coming months.
Bed Bath & Beyond sales were $6.62 billion in the fiscal year ended March 3, up from $5.81 billion in fiscal 2005. Net earnings were $594.2 million, or $2.09 per diluted share, up from $572.8 million, or $1.95 per diluted share, in the year before.