By  on September 4, 2008

A sluggish back-to-school season tripped up retailers reporting August comparable-store sales Wednesday, possibly foreshadowing what’s to come when most comps roll in today. For Kohl’s Corp., J.C. Penney Co. Inc., American Eagle Outfitters Inc., Hot Topic Inc. and Zumiez Inc., late back-to-school shopping in August provided limited relief from frugal spending. The pickup failed to reverse declines in same-store sales, except in the case of Zumiez. For the most part, comps were in line with company guidance and their impact was softened by tight inventory controls.Same-store sales for Penney’s slid 4.9 percent for the month. Women’s apparel and family shoes excelled, while home and fine jewelry put up the weakest results. Sales improved during the last three weeks of August as customers chose to shop later in the b-t-s season, the company said, continuing a recent pattern. Speaking at the Goldman Sachs Global Retail Conference in New York Wednesday, Myron E. “Mike” Ullman, chairman and chief executive officer of Penney’s, said comps were influenced by a decrease in mall foot traffic, as well as hurricanes in the Southeast. Ullman said the adverse weather conditions were sure to lower September comps to mid- to high-single-digit decreases.He also said the American Living line, from Polo Ralph Lauren Corp.’s Global Brand Concepts division, was expected to generate more than $300 million in its first year. Last month, Ullman said American Living, which is at the top of Penney’s price range, was initially mispriced and will be adjusted where necessary.According to Banc of America Securities retail analyst Dana Cohen, Penney’s was “essentially” on target with comps, and in terms of inventory management, “expectations again seem solid” with management still “looking for inventories down at the end of the [b-t-s] selling season.”At Menomonee Falls, Wisc.-based Kohl’s, comps decreased 5.8 percent, compared with a 0.6 percent dip for the same period last year. The company said it would continue to manage inventories, an encouraging sign, Cohen said, after noting that b-t-s sounded “a bit rocky.”The retailer had anticipated a 2 to 4 percent decrease in monthly comps. “Some traditional [b-t-s] business such as footwear and children’s performed well, while other areas such as juniors and young men’s were more challenging,” said president and ceo Kevin Mansell. “We continue to manage our inventory levels and expenses conservatively in this environment.” Tightening inventories may have held back sales, but it also limited markdown exposure, said Stifel Nicolaus & Co. analyst Richard Jaffe. Consumers are shopping for “nationally recognized brands that they perceive have higher quality, greater fashionability and more status,” he said. “Kohl’s, with its increased penetration of private and exclusive brands, is capitalizing on this consumer preference, which is fueling sales at higher margins.” Larry Montgomery, chairman of Kohl’s, said at the Goldman Sachs conference that the retailer will “continue to be very, very aggressive in terms of our approach to products and that is continuing to expand the percent of our business that we do in private and exclusive brands.” While Penney’s and Kohl’s reported August results on Wednesday morning to coordinate with appearances at the conference, several specialty store retailers maintained their custom of posting monthly sales after the close of the markets on Wednesday.Teen retailer American Eagle posted a 5 percent decrease in comps, compared with a 9 percent increase in the same period last year. The company reaffirmed its third-quarter earnings guidance of 31 to 36 cents a diluted share.Mall-based retailer Hot Topic reported a 2.7 percent dip in comps, versus a 1.1 percent decrease for the same month in 2007. Specialty retailer Zumiez managed a 0.2 percent comp increase, versus a 17.4 percent jump in comps in the year ago period.

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