Its also starting to sound like a broken record over at Pacific Sunwear as the other mall darling continues to yank business away from the teen retail sector through superior merchandising and product selection in two very different formats.
The companys original PacSun unit that caters to the Surf/Skate crowd continues to capitalize on the surfer girl trend, posting 15.2% same-store sales increase for August. The newer d.e.m.o. format that is geared to the suburban hip-hop consumer again posted comps in excess of 20%. Total company comps were up 15.6% and total net sales were up 24% to $136.7 million.
The company cited continued momentum in girls, footwear and accessories, while the mens business showed “modest improvement” for the month with comps up in the “mid-single digits.”
PSUN is also raising its guidance for Q3, forecasting that EPS should be 41 cents versus the previous guidance of 39 cents, which was also the analyst consensus estimate. This revised forecast assumes a same-store sales increase of 6% to 8% for the combined September and October periods.
PSUN sees comps up in the 5% to 6% range for Q4, netting EPS of 54¢, up a penny from previous guidance.
On the other hand, The Buckle cant seem to get the mix right to also capture the surf apparel shift that is benefiting PacSun. The retailer is pushing more of its assortment to the denim side of the business, with the category now 46% of sales versus 41% in the year-ago August period.
Comp store sales dipped 0.6% from last year while total net sales increased 3.0% to $48.1 million.
The company also said its average selling price was down 5.0% for the month and that markdowns in August were up versus a year ago. Margins actually improved despite the markdown influence. Inventory was up 1.0%, but down slightly on a per-store basis.
The shift in dollars is seen across the rest of the mall landscape as the fickle teen consumer trades the A&F and American Eagle look for Licensed Apparel and Surf lifestyle goods. Richard Jaffe, an analyst at UBS Securities, said that Abercrombie & Fitch backed off on discount coupons and other programs this season compared to a year ago — a strategy that hurt sales — while American Eagle missed some key trends like hooded fleece sweatshirts.
The Gap is getting some of the traffic back as they re-work the mix and go the music endorsement route through its recent Madonna/Missy Elliott ad blitz.
The department stores are lost in limbo, meaning little to the kids in the mall, but they will still play a part as we move closer to the holidays and the markdown game starts to get played to the hilt.
