Many major American retailers were able to recover from a slow start to December shopping, according to monthly sales results reported on Thursday.
Despite early indications that the holiday season would be lackluster, the 17 apparel chains tracked by Thomson Reuters reported a 4.5 percent increase for December sales at stores open at least a year, exceeding the 3.3 percent gain analysts had expected.
However, Target, the nation’s second-biggest retailer after Walmart, said its December sales were flat.
Retailers relied on discounts to get that December revenue, which may hurt results when they report fourth-quarter profit.
“Sales came late in the holiday shopping season and, as a result, were at deeper discounts than planned,” said Kevin Mansell, Kohl’s chief executive. He said the company would take further markdowns as it prepares for spring.
The stores reporting sales data on Thursday ranged from apparel retailers to department stores, though some large retailers, including J. C. Penney and Saks Fifth Avenue, as well as Walmart, do not report monthly data.
Analysts noted a rush of last-minute promotions after slow sales early in the month.
“We’ve noticed significant promotions at retailers looking to recover preholiday sales, and fewer promotions at retailers we believe have performed well,” Oliver Chen, a Citigroup analyst, wrote in a research note.
With drugstores included in the totals, the rise in December retail sales from a year ago was 2.3 percent, Thomson Reuters said. Drugstores are dealing with consumers switching to cheaper generic drugs. ShopperTrak, which counts shoppers at the nation’s malls, reported that traffic picked up in the final week before Christmas. Still, in December it lowered its sales forecast for November and December to a 2.5 percent gain over last year, down from the 3.3 percent it had estimated previously.
Another reading on the holiday season was also tepid. MasterCard Advisors SpendingPulse, which estimates overall consumer spending, said last week that holiday-related sales rose 0.7 percent from the end of October through Christmas Eve, the smallest increase since 2008. Last year, sales were up 2 percent.
Most of the department stores reporting results Thursday beat analysts’ expectations.
At Nordstrom, sales at stores open at least a year, a measure known as same-store sales, were up 8.6 percent, shooting past estimates of 3.4 percent.
Kohl’s said its same-store sales rose 3.4 percent, above analysts’ estimates of 1.2 percent but below Kohl’s internal expectations.
Macy’s same-store sales were about in line with analysts’ expectations, at 4.1 percent. Macy’s said fourth-quarter earnings would be in a lower range than it had previously announced, at $1.91 to $1.96 a share, down from $1.94 to $1.99 a share.
Target, which heavily promotes the holiday season, said its same-store sales were flat compared with last December, while analysts had expected a 0.8 percent gain. Its heavily promoted collection of designer holiday gifts, in partnership with Neiman Marcus, was a disappointment, according to some analysts. The company said that the number of same-store transactions fell compared with last year, but the average amount spent per transaction rose, and that the food, health and beauty, apparel and home categories were up over last year.
“Strong results late in the month did not completely offset softness in the first three weeks,” Gregg W. Steinhafel, Target’s chief executive, said in a statement.
The discounter Costco did much better than expected, with a 9 percent same-store sales gain, above the 6.5 percent that analysts had projected.
Among apparel stores, the teenage clothing retailer Wet Seal posted a decrease of 9.7 percent and Zumiez posted a decline of 1 percent.
Article source: http://www.nytimes.com/2013/01/04/business/retailers-post-4-5-increase-in-december-sales.html?partner=rss&emc=rss
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