L Brands Inc. reported that June net sales increased 7 percent to $1.29 billion for the five weeks ending July 2. Comparable sales for the same period increased 6 percent. This easily beat the Thomson Reuters estimate for an increase of 2.1 percent.
The positive numbers reflected the timing shifts in the Memorial Day and Fourth of July holidays. But margins were down significantly due to clearance items at Victoria’s Secret. June is the month that the store holds its big semiannual sale.
In July, Victoria’s Secret will transition out of the sale and focus on new fashion in bras like the new ‘Lounge Bra’ while at Pink, the focus will be on ‘Wear-Everywhere’ bras. L Brands said it expects July comps to be flat to down low-single digit.
The Cato Corporation said its June sales for the five weeks ending July 2 fell 6 percent to $88 million versus last year’s sales of $93.8 million for the five weeks ending July 4. Same-store sales for the five-week period also fell 8 percent versus last year. Cato’s sales decline missed the Thomson Reuters estimate for an increase of 1 percent. “June same-store sales were well below expectations,” commented John Cato, chairman, president and chief executive officer.
Zumiez Inc. didn’t fare any better as its June net sales dropped 0.6 percent to $66.6 million versus last year’s $67 million. Comparable sales declined by 4.5 percent, which was worse than last year’s drop of 3.3 percent for the same time period. But it was better than the Thomson estimate for a decline of 6 percent.
The company’s chief financial officer Christopher Work said that while the number of transactions fell, the dollar amount per transaction increased. Men’s posted positive comps, while the other categories fell. Zumiez delivered its June numbers on Wednesday and the market was pleased with the results as the stock jumped almost 5 percent to $14.54 this morning.
The Buckle Inc. had it even worse as June net sales dropped 10.1 percent to $78.3 million compared to last year’s $87.1 million. Comp-store sales also fell 10.6 percent. This was much worse than the Thomson estimate for a drop of 9.5 percent in same-store sales.
The Gap Inc. is expected to report same-store sales for June after the market closes today.