Retailers Report Weak Sales in December
New York City An already weak holiday shopping season turned out to be even worse than expected for many of the nation’s retailers, who on Thursday reported disappointing sales results for December. The poor performance raised more concerns about consumer spending, and caused many retailers to lower their fourth-quarter earnings forecasts.
Clouding this year’s holiday picture was a shift in the retail reporting calendar, making some results look worse than they really were, after artificially inflating November results. The Thanksgiving holiday also came earlier this year, shifting some key holiday shopping days away from December and into November.
Bad weather in certain regions also kept some potential shoppers at home. December 2007 was the third-coldest of the past 15 years, and the snowiest since 2000, according to weather-tracking firm Planalytics.
The sluggish results could be seen across all retail categories. But department stores and specialty apparel retailers, with a few notable exceptions, were hit the hardest.
Among the few bright spots was Wal-Mart Stores Inc., which posted results that exceeded Wall Street expectations, as it benefited from shoppers trading down to cheaper stores amid higher gas prices and a slumping housing market.
The chain posted a 2.4% increase in same-store sales, but said that its fourth-quarter results will be “pressured by higher interest expense” compared to last year. Rival chain Target Corp., however, saw its monthly sales rise by only 0.1%.
Costco Wholesale Corp. also topped analysts’ sales estimates, with a 7% increase in same-store sales. And Aeropostale Inc. said its same-store sales jumped 12.2% in December, soaring past Wall Street’s expectations.
Macy’s posted a 7.9% drop in same-store sales, lower than the 6.5% decline anticipated. For the November-December period combined, Macy’s same-store sales were down 1.1%.
J.C. Penney Inc. said its December same-store sales fell 7.5%, hurt by weaker sales of big-ticket home items and jewelry.
Nordstrom Inc. reported that same-store sales fell 4%, while Saks inched up 0.8% in December.
The Limited Inc. posted an 8% drop in same-store sales. Based on weak sales, it said it is likely that fourth-quarter earnings will fall toward the low-to-midpoint of its previously announced projections.
AnnTaylor posted a 9.4% decline in same-store sales, much larger than the 1.9% drop analysts were expecting. It cut its fourth-quarter earnings estimates.
Maternity apparel retailer Mothers Work Inc. reported that same-store sales fell 7.6%, worse than the 0.5% analyst estimate.
Pacific Sunwear of California Inc. posted a 2.8% decline in same-store sales, a little bit better than the 3.1% forecast.
Chico’s FAS’ same-store sales fell 13.7% on soft demand at its Chico’s brand and White House/Black Market stores.
Among the bright spots in specialty retailing was Aeropostale Inc., whose same-store sales jumped 12.2% in December, and The Buckle Inc. whose same-store sales surged 18.7%.
Big Lots reports exec changes
COLUMBUS, Ohio Big Lots today announced a retirement, advancements, and new assignments.
Donald Mierzwa, evp of store operations, will retire April 15, 2008, after 19 years with the company. Mierzwa oversaw store standards, customer service, personnel development, and program implementation for the chain’s 1,300+ stores in 47 states. A search will begin immediately for his successor.
Norman Rankin has been named senior vp of Big Lots Capital and will be responsible for Big Lots Capital and the wholesale division. Rankin will report to ceo Steve Fishman in his new role.
Robert Segal has been promoted to senior vp of general merchandise manager responsible for the furniture and home divisions.
Charles Haubiel II has assumed additional responsibility for the company’s real Estate Department and has been named senior vp of legal and real estate. He will continue to serve as the company’s general counsel and corporate secretary.
BJ’s monthly merchandise comps up 5.9%
NATICK, Mass. BJ’s Wholesale Club reported that total sales for December 2008 increased by 3.2% to $1.06 billion from $1.03 billion in December 2007. On a comparable-club basis, sales increased by 1.6% for the month of December, including a negative impact from sales of gasoline of 4.3%. Excluding gasoline sales, merchandise comparable club sales increased by 5.9% in December.
BJ’s reported that a comparable-club sales increase of approximately 9% in food was somewhat weaker than planned and reflected the impact of sales interruptions in the Northeast caused by winter storms during critical food shopping periods. An increase of approximately 2% in general merchandise sales was somewhat higher than planned and was driven by strong sales of low-margin televisions and other consumer electronics, and by a higher level of promotions and price reductions versus last year, particularly in seasonal and toys. Sales decreased during the first three weeks and increased during the last two weeks. The decreases in weeks two and three reflected the negative impact of snow and ice storms in the Northeast.
For the month of January 2009 the company expects to report an increase in merchandise comparable club sales, excluding gasoline sales, of approximately 6%.