US retailers reported a mix bag of May sales results on Thursday. Most of them, including Limited Brands, Gap, Target, TJX, Ross Stores, Nordstrom, Saks, and Macy's reported modest sales increases at established stores, but sales were down at Kohl's and Wet Seal.
The modest sales growth in May was attributable to the pre-Mother's day shopping falling later into May this year compared to early May last year. That snatched sales from April this year. Mother's Day shopping is seen as the second biggest gifting holiday in the year after Christmas.
A decline in gasoline prices may also have potentially given a boost to discretionary spending.
On the other hand, unseasonably warm weather in March made consumers buy spring merchandise early, snatching some of those sales from April and May.
The majority of retailers topped analysts' estimates, except Kohl's, Gap and Wet Seal.
A report released from the Conference Board on Tuesday showed that consumer confidence dropped to the lowest it has been in four months, the U.S. consumer confidence index fell to 64.9 in May from a revised reading of 68.7 for April.
Comparable-store sales or comps is a key retail industry performance metric to gauge activity at store locations that have been open for at least a year. Analysts polled by Thomson Reuters expected the retailer's comparable store sales to increase 3.6 percent in May, lower than the 5.4 percent rise in May last year.
Apparel retailer Limited Brands, Inc. (LTD: Quote), the operator of Victoria's Secret and Bath & Body Works chains, said its May comparable store sales rose 6 percent, reflecting the continued strength of its Victoria's Secret Stores brand. The result exceeded Street expectations of a 4.7 percent growth. Meanwhile, net sales declined to $671.9 million from $717.4 million last year.
Another specialty apparel retailer Gap, Inc.'s (GPS: Quote) May comparable sales were up 2 percent, including the associated comparable online sales. Street was looking for a 3.1 percent increase. Net sales grew to $1.10 billion from $1.06 billion a year ago.
Specialty retailer to young women, Wet Seal, Inc. (WTSLA: Quote) stated its comparable sales declined 8.8 percent in the month, while analysts estimate was for a 7.7 percent drop. Based on brands, the Foothill Ranch, California-based company's May comparable store sales decreased 8.7 percent at Wet Seal and 9.3 percent at Arden B. Net sales declined 7.0 percent.
"E-commerce sales declined 5% in May compared to a 6% decrease for the prior year month. The level of May sales decline reflects improvement from our recent trend," CEO Susan McGalla said in a statement.
Among discount retailers, Minneapolis, Minnesota-based Target Corp. (TGT: Quote) reported a 4.4 percent increase in comparable store sales for the month, topping analysts' expectations of a 3.5 percent growth. Total monthly net retail sales grew 5.0 percent.
Off-price retailer TJX Cos., Inc. (TJX: Quote) reported that May comps were up 8 percent and total sales also increased 10 percent from last year to $1.9 billion. Analysts' were looking for a 5.3 percent growth in comps.
"We were particularly pleased to see all of our businesses across the U.S., Canada and Europe continue to post such consistent, strong performance. Once again, customer traffic was up significantly at every division which we believe speaks to the power of our values, brands and fashions," TJX CEO Carol Meyrowitz said in a statement.
Another discount retailer Pleasanton, California-based Ross Stores, Inc. (ROST: Quote) said May same-store sales increased 8 percent, topping Street estimates for a growth of 5.3 percent. Total sales rose 13 percent to $746 million from a year ago.
"While we hope to do better, for the balance of the quarter our forecast for same store sales to increase 3% to 4% in June and 2% to 3% in July remains unchanged," Ross Stores CEO Michael Balmuth stated.
Fashion specialty retailer Nordstrom, Inc. (JWN: Quote) reported a 5.3 percent increase in same-store sales for May, just above analysts' estimate for a 5.1 percent rise. Preliminary total retail sales also grew 9.3 percent from last year.
Among department store chains, Cincinnati, Ohio-based Macy's (M: Quote) set the tone on Wednesday by reporting that same-store sales for May increased 4.2 percent over last year, higher than the 4.0 percent growth analysts were expecting.
Meanwhile, online sales, which is included in the same-store sales calculation, at macys.com and bloomingdales.com combined, increased 42.3 percent in May. Net sales also grew 4.1 percent.
"The momentum in our business continued in May, and came on top of a very strong month last year. Growth in May 2012 came from stores and online, and across geography and categories of business," Chairman, President and CEO Terry Lundgren noted.
Menomonee Falls, Wisconsin-based Kohl's Corp. (KSS: Quote) reported a 4.2 percent decline in comparable sales for the month, while Street expected it to decline 1.0 percent. Total sales also declined 2.6 percent year-over-year to $1.34 billion.
Kevin Mansell, Kohl's chairman, president and chief executive officer, said, "May sales were lower than our expectations and, as a result, we now expect second quarter comparable store sales to be modestly negative. From a line of business perspective, we saw strength in Accessories."
Fashion retail store chain, New York-based Saks, Inc. (SKS: Quote) reported that comparable store sales increased 4.0 percent in May, beating analysts expectations for the 2.5 percent growth. Total owned sales also grew 3.7 percent to $215.8 million from last year.
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by RTT Staff Writer
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