Tuesday Morning 1Q comps suffer, expects loss
DALLAS Tuesday Morning reported net sales for the first quarter 2009 were $165.9 million compared with $173.4 million for the quarter ended Sept.30, 2008, a decrease of 4.3%. Comparable-store sales for the quarter decreased by 5.8%, comprised of a 1.7% decrease in traffic and a 4.1% decrease in average ticket.
Based on the first quarter sales results, the Company currently expects the loss per share for the first quarter to be in the range of 11 cents to 13 cents. The loss per share was 10 cents for the quarter ended Sept. 30, 2008.
“Credit and housing woes continued to impact the discretionary spending behavior of our customers,” said Kathleen Mason, president and CEO. “The quarter started slowly during the ‘cash for clunkers’ program, but picked up in September. Our trend in comparable store sales and customer traffic continued to improve. We successfully managed inventory and kept expenses in line with revenues. Our balance sheet improved with low usage and high availability on our line of credit.”
Walmart addresses Tamiflu shortage
BENTONVILLE, Ark. Wal-Mart Stores announced that more than 4,000 Walmart and Sam’s Club pharmacies nationwide will convert Tamiflu capsules into liquid in order to address a national shortage of the product.
According to the company, this process is FDA approved and will ensure Americans have greater access to the well known antiviral drug often prescribed when individuals contract influenza. The liquid form is commonly taken by children, the elderly and those with difficulty swallowing the capsule form.
Due to limited inventories and commercial supplies of Tamiflu oral suspension, the FDA approved the directions pharmacists use to compound the liquid medication from Tamiflu capsules. This provides an alternative when the commercially manufactured oral suspension formulation is not readily available.
“We want to assure families and their physicians that our team of pharmacists stands ready to meet the needs of our patients young and old,” said Dr. John Agwunobi, president of Walmart’s health and wellness division. “We have the medication available, and we have pharmacists skilled in compounding oral suspensions.”
Why the Grinch won’t steal Christmas
The status quo loves the status quo, which goes a long way toward understanding why most forecasts are projecting a dismal holiday season. The National Retail Federation says sales during November and December will decline 1%, following last year’s 3.4% decline in holiday sales. Retail Forward and Deloitte both contend holiday sales will be flat with the prior-year while the International Council of Shopping centers projects a 1% increase.
It’s easy to understand why these groups are so pessimistic about the spending outlook. Unemployment is high, so there is less money to be spent overall, and those who do have money to spend are presumably going to be more cautious about how they allocate it during the holidays. That is a terrible combination for the retail industry, but the good news is this year will be better than last year, and it may not be as bad as the experts predict, as consumers will have plenty of reasons to feel good about things in the months ahead.
For example, food price deflation and relatively cheap gas will make it less expensive to get together with family for Thanksgiving. Meanwhile, deals will abound this Christmas, with deflation a major factor in such popular holiday categories as electronics and entertainment with prices already falling for gaming consoles, digital cameras and various Apple products.
The economy may not be in great shape and deflation will pressure sales growth, but don’t be surprised come January if this year’s batch of holiday forecasts proves overly pessimistic. After all, when economic conditions are bad the easiest thing to do is forecast they will remain that way or to project improvements will come modestly. The inverse of this situation was in effect just a few years ago when the economy was roaring and the good times were gong to last forever.