Retail Sector Hit Hard by Job Cuts
Washington, D.C. Employees at car dealerships, furniture stores, gas stations and clothing retailers were among the hardest hit by job losses in December, when unemployment climbed to a two-year high, according to the Associated Press.
Workers at department stores bucked the trend that led to the nationwide loss of more than 24,000 total retail jobs last month, but even those companies’ stocks—along with the rest of the retail sector—took a beating on Friday after the Labor Department said the unemployment rate had jumped to 5%.
Consumer spending has been hurt by the housing slump, credit problems and high food and gas prices, analysts said.
On Wall Street, Macy’s Inc., J.C. Penny Co., Kohl’s Inc., Bon-Ton Stores Inc. and Stage Stores Inc. all hit 52-week lows during Friday trading. The major indexes also fell, with the Dow Jones industrial average losing more than 200 points Friday afternoon.
CVS Caremark Dec. sales hurt by weather
WOONSOCKET, R.I. CVS Caremark today announced that same-store sales in its CVS/pharmacy division for the five weeks ended Dec. 29 increased 1.8% over the prior year period. Pharmacy same-store sales increased 2.4%, and were negatively impacted by approximately 470 basis points due to recent generic introductions. Front-end same store sales increased 0.6%.
Tom Ryan, chairman, president and ceo, stated, “Sales in December were lighter than anticipated due to adverse weather conditions early in the month, a slowly developing flu season, and general economic conditions. However, given favorable operating expenses and improved margins, we expect to report diluted earnings per share on a GAAP basis for the fourth quarter 2007 in the range of 54 cents to 55 cents, and for the full year 2007 in the range of $1.91 to $1.92, at the high end of our previous guidance of $1.89 to $1.92.”
For the fourth quarter, same-store sales at CVS/pharmacy for the thirteen weeks ended Dec. 29, increased 3.4% over the prior year period. Pharmacy same-store sales increased 3.6%, while front-end same-store sales increased 2.9%.
Same-store sales at CVS/pharmacy for the 52-week period increased 5.3% over the prior year period. Pharmacy same-store sales increased 5.2%, while front-end same-store sales increased 5.3%.
Virgin Megastores comps up 6.6% in Dec.
LOS ANGELES Virgin Megastores today reported same-store comparable sales growth of 6.6% in December and 11.5% over the final quarter of the year. The company also reported that DVD sales were up 18.1%, fashion sales were up 35.1% and video game sales were up 111.9%.
Virgin Megastores said that despite the overall decline in music industry sales, its sales are up 1.2% overall for the year 2007.
“It is the second consecutive year that sales have way exceeded our expectations,” states Simon Wright, ceo of Virgin Entertainment Group, North America. “We started seeing positive results in 2006 from our diversification strategy and the sales in those departments continued to climb throughout 2007. Virgin Megastores are being recognized as an entertainment lifestyle destination, rather than solely a music retailer.”