FINANCE

Discounters and warehouse clubs beat expectations in November

BY CSA STAFF

New York City — The nation’s discount retailers and warehouse club operators posted strong sales in November, beating analysts’ expectations. The results were fueled by promotions and cold weather in some parts of the country, as well as strong Black Friday traffic.

Target Corp. said Thursday more shoppers came to its stores in November and spent more than a year earlier, helping to fuel a 5.5% rise in same-store sales during the month. Analysts polled by Thomson Reuters, on average, expected a 3.7% gain.

Total sales for the four weeks ended Nov. 27 rose 6% to $6 billion. So far this year, Target’s same-store sales increased 2.4%. Total revenue rose 4% to $51.52 billion.

CEO Gregg Steinhafel said customers were responding to the company’s holiday merchandise and discounts, including a 5% discount it is offering all users of its Target cards.

Costco said Thursday that its November same-store sales surged 9%, helped by the weaker dollar and higher gas prices, better than 6.2% analysts had forecast. Sales were up 7% in its U.S. stores and 13% in its international stores.

Excluding the effect of higher gas prices and the weaker dollar, revenue in stores open at least a year rose 6%.

Food, housewares, jewelry and clothing sold well, electronics less so. Revenue from TVs fell even as Costco sold more TVs, because prices have fallen.

At BJ’s Wholesale Club, November same-store sales were up 5%, with both food and general merchandise sales climbing. Its results topped the 3.9% rise that analysts polled by Thomson Reuters expected.

The warehouse club operator said its results included 1.2% from gasoline sales. Removing gas sales, the metric rose 3.8%. BJ’s said all major regions reported revenue increases at clubs open at least a year, with the strongest gains in the Southeast. Food sales increased about 4% in November, with general merchandise sales up about 3%.

TJX Cos. said Thursday its November same-store sales rose by 3%. Wall Street analysts had expected the company’s same-store sales to increase by 2.9%,

Ross Stores reported a 6% same-stores gain in November.

Michael Balmuth, CEO, commented, "November sales were better than expected as we benefited from a continued focus on value by consumers that drove healthy traffic to our stores. Merchandise and geographic trends were relatively broad-based. Juniors and Shoes were the strongest merchandise categories, while Florida and Texas were the top performing markets."

Duckwall-Alco Stores said Thursday that November revenue at its stores open at least a year rose 5.8%, buoyed by strong sales of clothing and electronics.

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FINANCE

SpendingPulse Survey shows year-over-year growth

BY CSA STAFF

Purchase, N.Y. — MasterCard Advisors SpendingPulse report, released Thursday, showed that sales in most retail categories continued to gain momentum over an already strong October showing.

Year-over-year total apparel sales in November saw a 9.6% increase, the largest year-over-year growth in 2010 for that sector following the previous record in October. Total apparel has recorded eight out of 11 months of year-over-year gains so far in 2010. In November, all of the sub-sectors posted year-over-year growth.

For the second consecutive month, the consumer electronics and appliances segment posted a year-over-year decline, although at -1.1%, it was not as severe as October’s decline. The consumer electronics sub-category was down by 1%, while the appliance sub-sector fell by 1.6% year-over-year.

E-commerce returned to double-digit year-over-year growth in November as consumers took advantage of free shipping offers and online-only specials. The category posted a year-over-year increase of 12.0%, the first double-digit growth rate since July, and the largest increase since May. The apparel sub-category rose 22.2%, increasing by double digits for the 12th consecutive month, led mainly by children’s apparel at +33.3%, and footwear at 32.7%. Online sales of electronics were up 6.0%.

Michael McNamara, VP research and analysis for MasterCard Advisors SpendingPulse, said: “Industry sales generally did well in November, building on the positive momentum first observed in September that carried through the early fall. The November retail sales gains indicate a solid start to the 2010 Holiday season for most categories, with some recording significant year-over-year gains.”

The SpendingPulse Luxury ex-Jewelry Index, which encompasses sales at high-end restaurants, food stores, department stores and general apparel categories, posted positive results in November, although not as robust as October, growing 1.6% year-over-year.

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FINANCE

Retailers post strong November sales, apparel a top-performer

BY CSA STAFF

New York City — Retailers nearly across the board reported a strong start to the holiday season as their November sales were enhanced by aggressive discounting that started early in the month. Same-store sales rose 6% in November, above the estimated growth of 3.6% and the year-ago gain of 0.6%, according to 27 retailers tracked by Thomson Reuters.

“Across the board, there was widespread strength,” said Ken Perkins, president of Swampscott, Massachusetts-based Retail Metrics, in a Bloomberg report. “The consumer is feeling better about their situation and is more inclined to spend on discretionary purchases. It bodes well for what will come over the next three and a half weeks.”

Confidence among shoppers also rose in November to the highest level in five months, according to the New York-based Conference Board.

The month was particularly strong for apparel. Year-over-year total apparel sales in November saw a 9.6% increase, according to a MasterCard Advisors SpendingPulse report, which estimates total retail sales across all payment forms. The results were fueled by a 3.9% in sales of women’s clothing and a 7.2% gain for men’s apparel.

Abercrombie & Fitch reported a 22% gain in its November same-store sales, topping expectations and leading the way among specialty retailers.

Eric Cerny, manager of investor relations, said in the message that while November sales exceeded Abercrombie’s own estimates, November was also expected to be the strongest month of the quarter.

"[Sales] growth is expected to moderate for the quarter as a whole, including January being negative," he added.

The Limited reported a same-store sales increase of 10% for the month, which topped analysts’ expectations of a 4% rise.

At Gap, same-store sales rose 4% in November, better than the Street expected, fueled by gains at namesake stores and Old Navy.

The fickle nature of teen shoppers was reflected in the results of Aeropostale, which had been a strong performer during the recession. The retailer came in below analysts estimates and reported a 1% drop in same-store sales for November. It issued a disappointing fourth-quarter outlook.

American Eagle Outfitter’s same-store results for November were flat, as holiday buying late in the month compensated for slow sales earlier in the month.

Other apparel retailers same-store sales results for November included:

* The Buckle reported a 7.9% increase;
* At Wet Seal, sales were up 7%;
* Zumiez topped estimates, with a 20.7% increase;
* Cato Corp. saw its sales 5%, handily beating analysts’ expectations; and
* At Destination Maternity Corp., sales rose 4%.

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