By  on January 11, 2011

The holiday season might have raised hopes only to later deflatethem, but the general retail narrative — as read in fourth-quarterupdates from Tiffany & Co., Sears Holdings Corp., The Talbots, Inc.and Phillips-Van Heusen Corp. — appears to have remained unchanged.

The extremes of luxe, at Tiffany, and mass, at Sears, foresaw betterprofits, while the struggles of the muddled middle were seen in Talbots’projected loss, which sent its stock reeling. PVH illustrated thepotential for growth through acquisition by playing up the impact of itspurchase of Tommy Hilfiger in May.

It was Talbots’ warning thatgot the strongest reaction from investors, who pushed the stock down17.4 percent to $6.25. Despite issuing stronger outlooks, shares of PVHfell 3 percent to $59.94 and Tiffany’s stock dipped 0.6 percent to$60.56. Sears was a standout with a 6.3 percent gain to $75.03, givingit the largest percentage increase of the 171 equities tracked by WWD.

The S&P Retail Index ticked down 0.1 percent, or 0.46 points, to501.27 as the Dow Jones Industrial Average gained 0.3 percent, or 34.43points, to 11,671.88.

■ Talbots, among a number of missy chainsfighting for buoyancy, now expects an adjusted fourth-quarter loss of 15cents to 19 cents a share, down from its previous projection, whichranged from a loss of 5 cents to a profit of 3 cents. Trudy F. Sullivan,president and chief executive officer, said the company would “continueto evolve our strategic approach to achieve our long-term objectivesand remain keenly focused on merchandise initiatives to improve ourassortment.”

■ Tiffany said November and December sales rose 11percent and would lead to adjusted profits of $2.83 to $2.88 for thefull year, moving the company’s previously projected range up 11 cents.“Healthy sales growth was seen across most product categories, withparticular strength in Tiffany’s fine jewelry collections, diamondengagement rings and fashion gold jewelry, although with limited growthin silver jewelry sales,” said Michael Kowalski, chairman and ceo.

■ Sears’ Kmart division posted a 3.4 percent comparable-store salesgain for November and December, driven by the chain’s layaway programand strength in apparel and footwear, sporting goods, toys and home.Comps at Sears U.S. stores fell 5.3 percent for the two months withdeclines in the electronics, appliances and tools areas. Sears projectedquarterly profits of $3.39 to $4.12 a diluted share, well ahead of the$3.09 analysts expected.

■ PVH said adjusted fourth-quarterprofits would tally 82 cents versus the range of 76 cents to 81 centspreviously projected.

With growth slow at best in the U.S.,other fashion companies are expected to follow in the footsteps ofEmanuel Chirico, chairman and ceo of PVH, who orchestrated theindustry’s first big postrecession acquisition: the $3 billion deal tobuy Hilfiger from Apax Partners.

In a presentation at the Cowenand Co. Ninth Annual Consumer Conference Tuesday, Chirico said theHilfiger business exceeded plan and will add about $205 million to PVH’soperating income this year. That’s $25 million more than originallyplanned and the ceo said $20 million of that was added to the brand’sadvertising budget.

Chirico expects the focus on advertisingand branding to leave the company in good stead as cost pressuresfinally work their way through the supply chain and are, at leasttheoretically, passed on to the consumer.

“We’re seeing costincreases for the first half in that 5 percent range, very manageable,”he said. “We’ll raise price slightly and work with our retail partnersand with our customers. Second half of the year, we’re seeing increasesthat are approaching 15 percent, I think everybody’s talking about thesame type of increases in the industry.”

Chirico said it wasstill unclear how the consumer would react to rising prices, but henoted the pricing dynamic change means retailers will have tighterinventories.

Late on Tuesday, Zale Corp. said same-store salesin November and December rose 8.5 percent, with an 11.5 percent increasein November and a more modest 7.4 percent boost in December. Excludingcurrency fluctuation, comps were up 7.6 percent for the season.

Also on Tuesday, Anchor Blue, Inc. filed for Chapter 11 bankruptcyprotection in federal court in Delaware and said it plans “to implementthe orderly liquidation of all the company’s assets.” The plan todissolve the chain confirms details in a previous story in WWD.

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