Retail sales mostly solid in August; Limited leads apparel, but Gap declines
New York City — Despite low consumer confidence, the volatile economy and a hurricane, many retailers reported better-than-expected sales in August. Hurricane Irene appeared to put a dent in the results of some retailers on the East Coast, but the storm did not appear to do as serious damage as some expected.
Total retail sales rose 4.4%, just missing the 4.6% rise that Wall Street analysts had expected, according to Thomson Reuters. Of the 19 out of the 25 retailers that Thomson Reuters tracks, 11 beat expectations.
The biggest winners include Costco Wholesale Club, with an 11% rise in same-store sales, and BJ’s Wholesale Club, where sales rose 11.5%.
On the apparel front, Limited Brands’ same-store sales climbed 11% in August, beating analysts’ expectations for a 7.6% rise.
The company, whose stores include Bath & Body Work and Victoria’s Secret, said Thursday that revenue for the four weeks ended Aug. 27 increased 11% to $702.4 million from $630.3 million.
At Gap, same-store sales fell 6% on disappointing sales across its brands, led by a decline at its namesake stores. Analysts polled by Thomson Reuters expected a decline of 3.8%. Total revenue fell 3% to $1.1 billion.
Same-store sales at Gap North America plunged 8%, its six straight decline. Sales at Banana Republic and Old Navy both fell 4%.
"As we said on our recent earnings call with investors, we’re determined to make the necessary adjustments to women’s product and marketing to improve our overall performance and drive top-line growth going forward," said Glenn Murphy, chairman and CEO of Gap.
In other apparel same-store sales results for August:
- The Buckle’s sales rose 8.3%, nearly double the growth analysts had predicted.
- Wet Seal said that sales climbed 5.5%, beating analysts’ estimates. The results were driven by a 7.3% increase at the company’s 461 namesake stores. The smaller Arden B division, which has 84 stores, drove down the combined results with an 8.7%.
- At The Cato Corp., same-store sales decreased 3%.
Irene hits department stores in August; Macy’s still beats Street, Kohl’s and J.C. Penney fall short
New York City — Macy’s reported that its same-store sales rose 5% in August, beating estimates. The retailer said sales would have been higher by 1.5% points without the impact of Hurricane Irene. Industry analysts had warned that the storm would impact department stores and specialty retailers the most as consumers focused on buying generators and other emergency and recovery items versus back-to-school and discretionary products.
Macy’s said that its sales also were hurt by about 130 Irene-related store closings, But the chain said sales over the past three days have been strong and it expects Irene’s negative effect on sales to be “substantially offset” in September and the third quarter.
At J. C. Penney Co., same-store sales in August decreased 1.9%, compared with the projected 0.8% increase. The retailer said its sales during the last week of August were negatively impacted by significant disruptions in the Northeast and Southeast caused by Hurricane Irene.
Kohl’s reported August same-store-sales fell 1.9%, with the results driven mainly by lower customer traffic.
“We are aggressively increasing our marketing as well as sharpening our pricing focus for the remainder of the fall season to reverse this trend,” said Kevin Mansell, Kohl’s chairman, president and CEO. “We are optimistic that these steps, combined with the excitement surrounding the Jennifer Lopez and Marc Anthony launches later this month, will have a favorable impact on our sales for the remainder of the year.”
In other department store results for August:
- Nordstrom’s said its sales rose 6.7%, ahead of expectations.
- At Saks, same-store-sales increased 6.1%., short of the 7.1% expected increase.
- Dillard’s reported sales were up 4.0% over last year.
Finish Line acquires 18-store specialty running chain
Indianapolis — The Finish Line has invested $8.5 million to acquire an 18-store chain of specialty running shops with locations in Connecticut, District of Columbia, Florida, Maryland, Massachusetts, New Jersey, New York, and Texas. The stores operate under banners such as Greater Boston Running Co., Texas Running Co., Georgetown Running Co., Princeton Running Company, New York Running Co. and others.
“This acquisition is an important step in our strategic plan to drive growth outside of our core Finish Line business,” said chairman and CEO Glenn Lyon. “We have a tremendous growth opportunity within the specialty running business with this acquisition as the foundation of that growth. We plan to expand the number of stores and develop this chain’s first e-commerce capability as well as pursue other potential acquisitions in the specialty running business.