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February Retail Sales Reports Start Rolling In

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Several retailers we follow reported February same-store sales this morning, and another 25 or so will release results tomorrow morning. After 12 straight monthly declines, retailers have posted 5 consecutive monthly gains and we expect that momentum to continue for February.

RetailSails Monthly Store Sales Index
This morning, MasterCard Advisors’ SpendingPulse released figures which showed most sectors saw gains in February, led by robust growth in luxury goods (+15.2% excluding jewelry), consumer electronics (+5.8%) and online sales (+16.7%). However, overall spending still remains depressed, led by weakness at clothing stores which saw a 1.8% decline on top of an 11.8% drop in the year-ago period. Continue reading ‘February Retail Sales Reports Start Rolling In’

Weekly Retail Sales: Mother Nature Strikes Again

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Mother Nature once again wreaked havoc on retailers across the Northeast this past week, adding to the record snowfall tallies which have tempered sales all month. With the unseasonably cold temperatures seen across much of the country in February, shoppers were pining for cold-weather merchandise, but were hard-pressed to find winter gear as extremely lean clearance inventories held back sales.

ICSC-Goldman Sachs Weekly US Chain Store Sales

The International Council of Shopping Centers (ICSC) reported that chain store sales fell 0.8% from the prior week, while still managing a 0.7% gain from the year-ago period. “The month finished off slightly as a result of another storm in the Northeast which pared the consumers’ ability to shop,” said Michael Niemira, ICSC’s chief economist. “However, the impacts from nature and the light volume of February sales make it difficult to read too much into this month’s performance.” Niemira added.

The company said Weather Trends International (WTI) reported temperatures for the month of February which were “the coldest in 21 years and [it was the] snowiest in at least 30 years which is a very big negative” for retail demand. However, given the constant barrage of storms, sales held up relatively well. ICSC Research expects comparable store sales for all of February to post a gain of about 2% after a 3% increase in January. Continue reading ‘Weekly Retail Sales: Mother Nature Strikes Again’

Monday Retail Reads

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  • Consumer spending increased slightly faster than expected in January, but real disposable income fell 0.6 percent in January, the largest decline in seven months – Reuters
  • Cellphones Let Shoppers Point, Click and Purchase: some retailers plan to turn applications on mobile phones into information displays and devices for ordering – NY Times
  • Dillard’s shares spiked over 15% on Monday as the company swung to a better-than-expected fiscal fourth-quarter profit, even as sales continue to post sharp declines – Market Watch
  • Restaurant Performance Index Declines Slightly in January, But Optimism for Future Business Conditions Strengthens: Same-store sales and customer traffic levels slip; Expectations Index tops 100 for the first time in 9 months – National Restaurant Association
  • In new ad campaign, Lowe’s Puts Its Focus on Knowing the Customer’s Wants – NY Times
  • J.C. Penney is launching its spring marketing campaign by calling attention to its growing list of exclusive fashion brands during Sunday’s Academy Awards broadcast – Dallas News

Apparel Sales Continue Slide, But Hope Springs Eternal

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2009 is a year most apparel retailers would like to forget. While investors have cheered recent fourth quarter earnings reports from chains including Gap and Limited Brands, companies can only count on cost-cutting and operational efficiencies for so long. At some point, these retailers will need see real improvements in top-line growth to sustain earnings momentum. Both retailers were able to post earnings gains for the year, even though total and same-store sales continued to drop.

The NPD Group reported that total U.S. apparel market sales decreased 5.2% in 2009, with sharp declines across all segments:

Annual U.S. Apparel Market Dollar Volume Sales (in 1,000’s)
2009 2008 YoY % Chg
Men’s $51,064,320 $54,220,730 -5.8%
Women’s $104,051,100 $109,361,800 -4.9%
Children’s $33,417,650 $35,246,900 -5.2%
Total Apparel $188,533,100 $198,829,500 -5.2%

The firm noted that although sales continued to decline during the holiday season, there was relative improvement as women’s apparel “only” posted a 3 percent decline from the prior year in the fourth quarter. Continue reading ‘Apparel Sales Continue Slide, But Hope Springs Eternal’

Gap Beats the Street, but Don’t Call it a Comeback

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Gap Inc. managed to beat consensus analyst earnings estimates by a penny for the fourth quarter of 2009, as improving sales and substantially higher margins helped drive strong bottom-line growth from the year-ago period.

For the quarter, net income jumped 45% to $352 million and diluted eps increased 50% to $0.51/share from last year. Total sales rose 3.8% to $4.2 billion and same-store sales increased 2%. Strong comp growth of 7% at Old Navy and 3% growth in e-commerce sales helped offset continued weakness at Gap, Banana Republic, and International chains. This was the first quarterly same-store sales gain for the company overall since the first quarter of 2004.

Gap Quarterly Same-Store Sales Continue reading ‘Gap Beats the Street, but Don’t Call it a Comeback’

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