US retailers reported Thursday sales performances for January at stores open for at least a year. Most of them, including Limited Brands, Target, TJX, Ross Stores, Nordstrom, Kohl's, and Macy's reported increases in sales providing a strong start to the year, with exceptions being Gap and Wet Seal. The results were largely higher than analysts' estimates, while Nordstrom, Macy's, and Wet Seal missed.
There were modest sales growth in January after the strong sales towards the fag end of the month of December and the end of the two-month holiday season. 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.
The warmer winter weather could have hurt some retailers as there was less demand for heavy jackets, and other cold weather gear.
Meanwhile, a recent report by the National Retail Federation revealed that retail sales in the U.S. will grow 3.4 percent to $2.53 trillion in 2012, a slower rate than the 4.7 percent growth in 2011. Analysts also anticipate 2012 to remain a 'promotional' year for retailers, with discounting being the instrument to compete with rivals.
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.
Apparel retailer Limited Brands, Inc. (LTD), the operator of Victoria's Secret and Bath & Body Works chains, said its January comparable store sales rose 9 percent, reflecting the continued strength of its Victoria's Secret Stores brand, partially offset by a decline at La Senza. The result exceeded Street expectations of a 2.7 percent growth.
Another specialty apparel retailer Gap, Inc.'s (GPS) January comparable sales were down 4 percent, including the associated comparable online sales this year, with all its brands, except Banana Republic North America, reporting negative comparable sales. Street was looking for a 4.9 percent decline.
"January was largely clearance-based, and we're pleased we successfully cleared holiday inventory. As we transition to a new year, our teams are focused on making the necessary steps to improve our business performance in 2012," Gap's Chairman and CEO Glenn Murphy noted.
Specialty retailer to young women, Wet Seal, Inc. (WTSLA) stated its comparable sales declined 13.0 percent in the month, while analysts estimate was for a 3.0 percent drop. Based on brands, the Foothill Ranch, California-based company's January comparable store sales decreased 12.7 percent at Wet Seal and 13.0 percent at Arden B.
"The fourth quarter ended with January sales that did not meet our expectations. Although January is the smallest sales month of the quarter, this led to lower fourth quarter comparable store sales than our previous estimate," CEO Susan McGalla said in a statement.
Among discount retailers, Minneapolis, Minnesota-based Target Corp. (TGT) reported a 4.3 percent increase in comparable store sales for the month, topping analysts' expectations of a 2.1 percent growth. Total monthly sales grew 5.1 percent.
"January sales were near the high end of our expected low to mid single-digit range, reflecting strong performance in both discretionary and non-discretionary categories. Sales trends were healthy throughout the month and across the country," Chairman, President and CEO Gregg Steinhafel said.
Off-price retailer TJX Cos., Inc. (TJX) reported that January comps were up 7 percent and total sales also increased 5 percent from last year to $1.4 billion. Analysts' were also looking for a 3.5 percent growth in comps.
"We are pleased with our above-plan 7% comparable store sales increase in January on both a consolidated basis and at the Marmaxx Group," CEO Carol Meyrowitz said.
Another discount retailer Pleasanton, California-based Ross Stores, Inc. (ROST) said January same-store sales increased 5 percent, topping Street estimates for a growth of 3.7 percent. Sales also came in ahead of the company's expectations for a 1 to 2 percent increase. Total sales rose 10 percent to $441 million from a year ago.
Looking ahead, the company project comparable store sales gains of 1 to 2 percent for both the first quarter and the full-year 2012.
Fashion specialty retailer Nordstrom, Inc. (JWN) reported an 5.0 percent rise in same-store sales for January, just missing analysts' estimate for a 5.3 percent rise. Preliminary total retail sales grew 13.2 percent from last year.
Among department store chains, Cincinnati, Ohio-based Macy's (M) same-store sales for January increased 2.4 percent over last year, lower than the 3.5 percent growth analysts were expecting. Net sales grew 2.0 percent, with online sales, macys.com and bloomingdales.com combined, growing 38.7 percent in January.
"Sales in January - the smallest-volume month of the year - were weaker than anticipated. Nonetheless, January was the 26th consecutive month of year-over-year same-store sales growth for our company," Chairman, President and CEO Terry Lundgren noted.
Menomonee Falls, Wisconsin-based Kohl's Corp. (KSS) reported a 0.6 percent increase in total comparable sales for the month, while Street expected a 0.1 percent increase. Meanwhile, total sales grew 2.4 percent year-over-year to $844 million.
Another department store chain, Plano, Texas-based J.C. Penney Co., Inc. (JCP) as of January is no longer reporting same-store sales as it undergoes a revamping of its pricing structure.
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