Most US retailers on Thursday reported strong January sales at established stores. A calendar quirk allowing for an extra week of sales boosted the January comps at Target, Kohl's, Gap, Nordstrom, Ross Stores, TJX, Limited Brands and Macy's.
Clearance sales also attracted customers as stores looked to make way for early spring merchandise.
Sales declines were seen at Wet Seal, and Buckle. The results were largely higher than analysts' estimates, while TJX, Buckle and Wet Seal missed.
The month of January is normally the slowest month for retailers following the most important holiday season sales rush. Sales were helped by demand for marked down clearance drives for merchandise left over from the busy holiday season.
Despite averting the 'fiscal cliff' on New Year's Day, consumer spending was negatively impacted by the 200 basis points increase in payroll tax and rising gas prices.
Meanwhile, a report released from the Conference Board a week ago showed a substantial deterioration in U.S. consumer confidence in the month of January with an increase in payroll taxes negatively impacting sentiment. The consumer confidence index fell to a fourteen-month low of 58.6 in January from an upwardly revised 66.7 in December. Economists had been expecting the index to be unchanged from the 65.1 originally reported for the previous month.
The smaller paychecks are hurting consumer confidence and economist believe that it may take a while for confidence to rebound and consumers to recover from their initial paycheck shock.
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 3.5 percent in January, down from last January's 4.4 percent growth.
Among discount retailers, Target Corp. (TGT: Quote) reported that comparable store sales for the month grew 3.1 percent, topping analysts' expectations for a 1.7 percent growth. Total monthly sales increased 29.6 percent to $5.97 billion from the prior-year month.
"January comparable-store sales were in line with our expectations as guests responded to clearance prices on holiday inventory. Our guests continue to shop with discipline in the face of a slow economic recovery and new pressures, including recent payroll tax increases," Target Chairman, President and CEO Gregg Steinhafel said.
Among department store chains, Kohl's Corp. (KSS: Quote) reported a 13.3 percent increase in total comparable sales for the month, while the Street expected a 3.1 percent increase. Total sales grew 34.1 percent year-over-year to $1.13 billion, with e-commerce business surging 59 percent, excluding the fifth week. Sales for the fifth week of fiscal January 2013 were $169 million.
Macy's (M: Quote) same-store sales for January increased 11.7 percent over last year, easily topping the 6.4 percent growth analysts were expecting. Net sales grew 34.6 percent to $5.10 billion from a year ago. Online sales (macys.com and bloomingdales.com combined) were up 48.9 percent in January. Online sales are included in the same-store sales calculation for Macy's.
"Simply put, January was an outstanding month for Macy's and Bloomingdale's. Our sales were driven by our strategy to flow-in more fresh fashion goods in December to better serve post-holiday shoppers seeking new and interesting merchandise," Macy's Chairman, President and CEO Terry Lundgren noted.
Specialty apparel retailer Gap, Inc.'s (GPS: Quote) January comparable sales were up 8 percent, with all four of it brands reporting positive comparable sales. Street was looking for a 4.0 percent increase. Net sales grew 36 percent to $1.13 billion from the prior-year month.
"We're pleased with the continued momentum in the business across all our brands in North America. As we transition to 2013, our focus remains on delivering compelling product in order to sustain our positive sales performance," Gap Chairman and CEO Glenn Murphy noted.
Specialty retailer to young women, Wet Seal, Inc. (WTSLA: Quote) stated its comparable sales declined 9.4 percent in the month, while analysts estimate was for only a 2.3 percent drop. Meanwhile, total net sales increased 23.3 percent to $40.0 million from last year. e-commerce sales also grew 29.8 percent.
Fashion specialty retailer Nordstrom, Inc. (JWN: Quote) reported an 11.4 percent rise in same-store sales for January. Preliminary total retail sales for the month were $951 million, up 38.4 percent from last year. The fifth week in January 2013 represented about $162 million in sales.
Apparel retailer Limited Brands, Inc. (LTD: Quote), the operator of Victoria's Secret and Bath & Body Works chains, said its January comparable store sales rose 9 percent, reflecting strength across its three chains. The result topped Street expectations for a 3.7 percent growth. Net sales were $986.4 million, up from $774.5 million last year. The fifth week in January 2013 represented about $125 million in sales.
Another apparel retailer, Buckle, Inc. (BKE: Quote) announced a 2 percent decline in comparable store net sales for the month of January, missing analysts' expectations for only a 1.2 percent decline. However, net sales increased 30.7 percent to $78.8 million from last year.
Off-price retailer TJX Cos., Inc. (TJX: Quote) reported that January comps were up 3 percent, missing Street estimates for a 3.5 percent increase. Total sales increased 35.7 percent from last year to $1.9 billion.
Another discount retailer, Ross Stores, Inc. (ROST: Quote) said January same-store sales increased 4 percent, topping Street estimates for a growth of 3.5 percent. Sales also came in ahead of the company's expectations for a 1 to 2 percent increase. Total sales rose 39 percent to $672 million from a year ago.
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by RTT Staff Writer
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