Mixed bag for apparel retailers and department stores in September
New York — Apparel retailers and department stores reported monthly revenue results for September that were mixed, as Gap Inc. and Limited Brands posted gains that beat Wall Street estimates, while Macy’s and Kohl’s missed expectations.
However, many analysts said spending was fairly strong for the month.
“This should set up to be a good holiday season," said Ken Perkins, president of Retail Metrics LLC, in an Associated Press report. "Consumers needed to take a breather once the back-to-school season is over."
Gap Inc. reported that its September same-store sales increased by 6%, ahead of analysts predictions for a 5.4% increase. By division, Gap North America reported a 5% increase; Banana Republic North America reported a 4% increase; and Old Navy North America reported a 10% increase. International sales were down 3%.
"In September, strong customer response to trend-right product across all brands helped us deliver continued positive performance in North America," said Glenn Murphy, chairman and CEO of Gap Inc.
Limited Brands’ same-store sales in September rose 5%, better than the 4.3% forecast by analysts. The chain said net sales for the five weeks ended Sept. 29 fell to $773.6 million, from $818.6 million. Net sales for the five weeks ended Sept. 29 rose to $1.45 billion, from $1.35 billion.
Macy’s reported that its September same-store sales rose 2.5%, short of analysts’ predictions for 3.3% increase. Online sales (Macys.com and Bloomingdales.com combined) were up 39.0% in September and 35.8% year-to-date in 2012, compared with 2011. (Online sales are included in the same-store sales calculation for Macy’s.)
The chain said combined August-September sales rose 3.6% and "were consistent with our positive year-to-date trend," said Terry Lundgren, the company’s chairman, president, and CEO. Total sales rose 2.7% to $2.36 billion for the five weeks that ended Sept. 29.
“We continue to feel good about the remainder of our fall season as we begin to ramp up receipts of fresh inventory for the cooler weather ahead,” Lundgren said.
Kohl’s Corp. said its September same-store sales fell 2.7%, bigger than the 0.2% drop analysts had predicted, hurt by lower demand for accessories and women’s clothing. Total sales decreased 1.4% to $1.6 billion
In other September results:
- The Buckle’s sales slipped 0.8%, missing Wall Street’s expectations for a 1% increase.
- Cato Corp. reported a 4% decrease, and said its third-quarter earnings will be at the low end of its guidance.
- Nordstrom’s sales rose 4.4% in September, below analysts’ expectations of a 5% increase. The company said sales suffered in early September because returns increased due to the later start this year of the department store chain’s big anniversary-sale event. Nordstrom said stores in the South and Midwest performed best, and the strongest categories were children’s wear, handbags and men’s shoes.
- The BonTon’s sales increased 0.6%. Total sales increased 0.7% to $288.9 million in the current year compared with $286.9 million in the prior year period.
Toys’R’Us joins digital entertainment game
WAYNE, N.J. — Toys"R"Us is expanding further into the entertainment space with the launch of a new digital service aimed at providing family-freindly movies and shows to its customers.
Branded as Toys"R:Us Movies (ToysrusMovies.com), the service features more than 4,000 titles, specially selected to supply hours of entertainment and fun for parents and children, according to the company. In addition, the service is equipped with easy-to-use, customizable parental controls to help moms and dads choose the most appropriate content for their family’s viewing. Toys"R"Us Movies is powered by Rovi Corp., a global leader in digital entertainment technology solutions.
According to the company, the service requires no subscription and features new movie releases the same day they hit retail store shelves and television shows the day after they air.
"At Toys"R"Us, we continuously strive to bring exciting technologies and services to our customers and to extend the Toys"R"Us brand into new areas," said Michael Scharff, SVP new ventures Toys"R"Us, Inc. "With Toys"R"Us Movies, we are able to leverage our valued relationships with leading digital and theatrical partners to provide great services and content we know families will love."
The service is now available ia PCs, Macs and Adobe Flash-enabled devixes. The company plans to expand the service to other web-enabled devices, including its newlt launched Tabeo tablet.
Movies start at $2.99 for a 24-hour rental and at $5.99 for a licensed digital download or stream. Television shows start at 99 cents, with the majority priced at $1.99. Toys"R"Us Movies gift cards will be available later this fall in Toys"R"Us stores nationwide.
Fortune’s faux pas on ‘Most Powerful’ ranking
Target’s senior executive ranks are filled with women, but don’t look for any of them on Fortune’s recent listing of the 50 most powerful women.
Topping the list in the October 8 issue is IBM president and CEO Ginni Rometty followed by PepsiCo chairman and CEO Indra Nooyi, Hewlett-Packard president and CEO Meg Whitman and Kraft Foods chairman and CEO Irene Rosenfeld. Gracing the cover is Yahoo CEO Marissa Mayer who recently defected from Google.
The list is dominated by executives who have a "C" somewhere in their title so that could explain the omission of female Target executives from the ranking. Of the 12 members of Target’s executive committee listed on the retailer’s Web site five are female but only one is C-level and one is a president.
Laysha Ward serves as president of community relations, but the nature of her substantial responsibilities doesn’t appear to be the stuff Fortune was looking for based on the composition of its list. Target EVP and CIO, Beth Jacob, might have been considered for inclusion as this year’s ranking tends to be dominated by tech company executives. Target’s other top female executives include Jodee Kozlak, EVP of human resources and Tina Schiel, EVP of stores.
Perhaps the Target executive most worthy of inclusion on the list is EVP of merchandising Kathryn Tesija. The 26 year Target veteran has occupied her current role since 2008 and in that capacity serves as a national tastemaker whose decisions have far-reaching influence on national fashion trends as well as the high velocity consumer packaged goods industry.
Lists of the type Fortune assembled are always highly subjective and the publication offered no rationale for its choices or the ordering, but Tesija is arguably the second most important executive at Target behind all powerful chairman, president and CEO Gregg Steinhafel. Her interpretation of the company’s "expect more, pay less," value proposition contributes greatly to the company’s success as the nation’s sixth largest retailer.
While Target was shut out on Fortune’s list, Walmart secured three positions thanks to several high level promotions earlier this year. The retailer’s Sam’s Club division named Rosalind Brewer president and CEO and Gisel Ruiz was named EVP and COO of the Walmart U.S. division. Both are included on the list with Brewer ranked 12thand RuizRanked 21. Also making the list in the 36th position was Susan Chambers, Walmart’s EVP of the global people division. The only other remail retail executive to make the list was BJ’s Wholesale Club president and CEOLaura Sen. A curiouschoice given BJ’s small size and slow rate of growth, especially when contrasted to Target.