Several department stores, including Macy's, Kohl's and J.C. Penney, and a few teen chains delivered robust June sales, overshadowing some lackluster results from some of the general merchandisers including Target and Costco. Sales had been expected to rise in June due to warm weather and a late Memorial Day, but some analysts saw those gains as temporary, bolstered by a steep decline a year ago.
June also tends to be a relatively slow month for retail sales. July will be a bit more important as it tends to kick off back-to-school shopping, which is the second biggest sales period after Christmas. Analysts said June appeared to be more promotional-driven than recent months.
“I think overall the consumer spending is slowing a bit,” Dana Telsey, chief information officer at Telsey Advisory Group, told Reuters. “I think what we saw at the beginning of the year is a little bit slower now than the middle of the year, I think overall we're seeing where there's unemployment and higher taxes, I think the news out there, consumers, they want to pause a bit.”
But most department stores racked up robust results, albeit against easy comparisons a year ago.
Macy's banged out a 6.5% same-store gain in June. Terry J. Lundgren, chairman, president and chief executive officer of Macy's, said the gain was particularly helped by the retailer's My Macy's localization initiative and the increased effectiveness and efficiency of its unified national organization.
“While various calendar shifts complicate month-by-month sales comparisons, it is important to note that Macy's, Inc.'s same-store sales in May/June combined, plus the Sunday and Monday of Independence Day weekend, were up approximately 5 percent over the prior year,” said Lundgren. “This is consistent with our year-to-date trend. We are optimistic as we look ahead to our fall merchandise offerings, including the early August introduction of the new Material Girl juniors brand exclusively at Macy's.”
Kohl's Corp reported sales for the five-week month ended July 3, 2010 increased 9.1% over the five-week month ended July 4, 2009. On a comparable store basis, sales increased 5.9%.
Kevin Mansell, Kohl's chairman, president and chief executive officer, commented, “As expected, we reported stronger sales early in the month as the Memorial Day holiday fell in fiscal June this year. We continue to be pleased with E-commerce sales which were better than planned for the month and have increased almost 50 percent over 2009 year-to-date.”
J. C. Penney Company, Inc. reported comparable store sales increased 4.5%. Penney said its key apparel businesses showed even stronger underlying trends in the June period, with mid-teen percentage increases in regular and promotional sales across men's, women's, and children's apparel categories. These sharp sales gains were partially offset by lower clearance sales resulting from reduced clearance inventory and the implementation of the company's non-comparable 'Red Zone' clearance strategy earlier this year.
Nordstrom, Inc. reported a 14.1% increase in same-store sales for the five-week period ended July 3, 2010 compared with the five-week period ended July 4, 2009. June 2010 multi-channel same-store sales were enhanced by an estimated 350 to 400 basis points due to the timing shift of Nordstrom's Half-Yearly Sale for Women and Kids, which started on Wednesday, May 26th. In 2009, the event began on May 20th.
Among teen chains, winners included Zumiez, which saw same-store sales jump 10.9% for the five-weeks ended July 3, versus a comparable store sales decrease of 19.3% in the year ago period. Aeropostale showed an 8% comp gain. Abercrombie & Fitch's June same-store sales grew 9%.
On the downside, The Buckle reported comparable store net sales decreased 7.3%. Hot Topic Inc. and The Wet Seal Inc. also reported decreases in revenue.
Costco Wholesale Corporation reported comp stores sales for the month of June, the five weeks ended July 4, 2010 rose just 1% in the United States after subtracting gasoline sales, but would have grown by 3 to 4% had Memorial Day fallen in the period. Costco noted that this year's five-week period included 33 days in the U.S. (closed Memorial Day and Independence Day) versus 34 days last year (closed Independence Day; Memorial Day was in the May reporting period). The Memorial Day holiday shift negatively impacted this year's total and comparable sales by approximately two percent (two to three percent in the U.S.).
Gap Inc.'s June sales at stores open at least one year were flat with a year ago. Sales at its international stores and Old Navy stores in North America were flat, after being negative in the year-ago period. Sales at Banana Republic stores in North Americas turned positive, while sales at its Gap stores in North America were less negative than in June 2009.
Target's comps rose 1.7%, short of the 2.7% rise analysts expected. Clothing, food, health care and beauty products were strong sellers but electronics, video games, music and movies were weaker.
