Be it the unseasonably warm weather or the spendthrift consumer, stores weighing in with January comparable-store sales were caught somewhat flat-footed as shoppers kept their wallets closed.

This story first appeared in the February 3, 2012 issue of WWD. Subscribe Today.

“Traffic has been tough,” said David Bassuk, managing director and head of AlixPartners’ global retail practice. “The consumer wants to spend money, but they need to be enticed.”

Among those that managed to draw shoppers in were Saks Inc., with a 10.5 percent comp jump; Victoria’s Secret, with 17 percent growth; Nordstrom Inc. with a 5 percent increase, and Target Corp., which posted a 4.3 percent rise, and, proving the ongoing strength of luxury, Neiman Marcus Inc. said comparable revenues jumped 9 percent during its second quarter ended Jan. 28.

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While luxury retailers and mass merchants continued to gain, midtier stores scrambled to get consumers’ attention. The number of chains following the monthly sales ritual dwindled once again as J.C. Penney Co. Inc. opted instead to weigh in on a quarterly basis.

Even with the so-so results, retail stocks rose Thursday and the S&P Retail Index gained 0.5 percent, or 2.81 points, to 553.73.

For some, the next round of quarterly earnings will be tough since many of last month’s sales promotions were unplanned as chains sought to clean up inventories and move out cold-weather goods.

Abercrombie & Fitch Co. said its fourth-quarter comps came in flat and that “lower-than-expected sales and higher markdowns” would cut deeply into gross margins. The teen retailer projected quarterly earnings of $1.10 to $1.15 a share, well below the $1.55 analysts expected.

In a research note, Eric Beder, analyst at Brean Murray, Carret & Co., was critical of A&F’s recent propensity for heavy discounting, saying it “basically destroy[ed] returns for everyone in the teen space….We have seen time and again in the teen space that price-driven market share gains do not result in enduring returns or sales.”

Abercrombie’s stock dropped 13.7 percent to $40.40 and established a new 52-week low of $40.31 in midday trading.

Among the chains losing ground in January were The Wet Seal Inc. with a 13 percent comp decline; Gap Inc.’s Old Navy with a 6 percent dip and its namesake chain with a 5 percent slide, and The Bon-Ton Stores Inc. with a 3.5 percent decrease.

Even though Gap Inc.’s total corporate comps fell 4 percent for the month, the decline was not as steep as expected and the firm boosted fourth-quarter profit projections to 41 cents to 42 cents a share versus the 35 cents analysts expected. That drove the stock to its best one-day performance since 2008, jumping up 10.6 percent to $21.52.

Casual Male Retail Group Inc. said its fourth-quarter comps inched up just 0.8 percent and lowered its profit guidance for all of 2011 to 28 cents to 29 cents a share, down from the 35 cents to 38 cents previously projected.

Despite the mixed bag of results, Michael Brown, a partner in the retail practice at A.T. Kearney, said, “All economic indicators are pointing towards a stronger 2012.”

Federal Reserve Chairman Ben S. Bernanke, testifying before the House Budget Committee on Thursday, said there has been some improvement in the economy although it is still “vulnerable to shocks.”

Bernanke said the employment situation has improved “modestly” over the past year, though “troubling” signs still exist, as more than 40 percent of the unemployed have been jobless for over six months.

On the bright side, he said manufacturing production has increased 15 percent since its trough and capital spending by businesses has “expanded briskly” over the past two years.

The shaky economy has shoppers focusing increasingly on value.

Deborah Weinswig, Citi equity analyst, said shoppers are flocking to merchandise at an attainable price and pointed to gains at Costco Wholesale Corp., Ross Stores Inc., The TJX Cos. Inc., Kohl’s Corp. and Macy’s Inc.

“I think the consumer feels pretty good,” Weinswig said. “Handbags, accessories, footwear and cosmetics are all showing strength. I think that’s why department stores are doing better than specialty stores.”

Weinswig said department stores generally have more forgiving return policies than many specialty retailers, as well as stronger multichannel distribution strategies.

Kimberly Greenberger, specialty analyst at Morgan Stanley, begged to differ, noting too few specialty retailers report monthly sales results to be able to draw any material conclusions.

“There has actually been a slow shift in market share to the specialty channel,” Greenberger said. “Despite the high-end recovery, those consumers are gravitating to specialty stores over department stores. Specialty retailers on average generate 10 percent of their revenues from e-commerce…which is the highest in retail.”

Greenberger said results failed to top last year’s take in January because the consumer benefited from better deals this year. And when consumers did go to stores, they found racks of cold weather apparel, most of which is on clearance now, she said.

“With six more weeks of winter, the consumer would rather buy spring clothes,” Greenberger said.

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