US chain store sales slow ahead of holidays-report

Biz.Yahoo/Reuters ^ | December 16, 2003

[Starwind]

US chain store sales slow ahead of holidays-report

Tuesday December 16, 8:56 am ET

NEW YORK, Dec 16 (Reuters) - U.S. chain store sales softened as shoppers put off their holiday gift trips until, retailers hope, the next couple of weeks, Instinet Research said in its Redbook report on Tuesday.

The pace of sales at major retailers slowed to 3.0 percent on a year-over-year basis for the week ended Dec. 13, after growing 3.2 percent in the preceding week, the report said. Sales at chain stores were down 1.1 percent so far in December compared with November.

"Alongside scheduled promotions, some department stores conceded to taking unplanned markdowns to move seasonal apparel as well as using email price discounts to try to draw customers into stores," the report said.

The Redbook data are compiled from a sample of same-store sales at general merchandise retailers representing about 9,000 stores. Same-store sales measure revenue at stores open at least one year. The index is released weekly by Instinet Research, a division of Instinet, a Reuters-owned electronic brokerage.

[Starwind]

US chain store sales shine after snow - report
Tuesday December 16, 7:46 am ET

NEW YORK, Dec 16 (Reuters) - U.S. chain store sales rebounded as shoppers came out in droves after the snowstorm in the Northeast largely halted retail business for a few days, a report said on Tuesday.

Sales increased 2.1 percent in the week ended Dec. 13 after a 2.5 percent fall in the preceding week, the International Council of Shopping Centers and UBS said in its report. Compared with the previous year, sales for the week grew 5.1 percent.

Consumers played catch-up after this winter's first snowstorm, anticipating Christmas and Hanukkah.

A survey taken by ICSC showed that 23 percent of consumers have not yet begun their holiday shopping, suggesting that buying patterns could pick up substantially in the coming weeks.

The ICSC-UBS Weekly Chain Store Sales Snapshot is compiled from a group of major discount, department and chain stores across the country that report their weekly results. The index measures sales growth with the year 1977 equaling 100.

[Starwind]

Fyi...

[The_Victor]

NEW YORK, Dec 16 (Reuters) - U.S. chain store sales softened as shoppers put off their holiday gift trips until, retailers hope, the next couple of weeks, Instinet Research said in its Redbook report on Tuesday.

NEW YORK, Dec 16 (Reuters) - U.S. chain store sales rebounded as shoppers came out in droves after the snowstorm in the Northeast largely halted retail business for a few days, a report said on Tuesday.

This is hilarious. Are you pointing out this contradiction for a reason other than humor?

[Starwind]

This is hilarious. Are you pointing out this contradiction for a reason other than humor?

You'd prefer instead I censor the reporting? Perhaps choose for you what you should read and believe?

These particular reports frequently conflict. I personally tend to put greater confidence in the redbook survey.

[The_Victor]

You'd prefer instead I censor the reporting? Perhaps choose for you what you should read and believe?

Of course not. Posting without comment is fine. I was just curious about what you were thinking by putting the two items side by side. If they weren't both from Reuters, it wouldn't be quite so ammusing. This just makes it look like Reuters doesn't know what they are talking about. Hmmmmm....

[RiflemanSharpe]

Ya think? Everone I know either has been laid off or has had a family member laid off in the past three years. And to a man they are keeping a close eye on their expenditures until they see real job growth. Good paying jobs that can support a family.

[Starwind]

This just makes it look like Reuters doesn't know what they are talking about.

The reporters don't. They merely pass on the 'spin' from their source. There is no 'vast left wing conspiracy' in economics reporting to 'get' President Bush or trash talk the economy. They're just telling it as they get it.

Economics commentary, OTOH, (which does not involve reporting per se) does have it's bullish & bearish viewpoints. Contrast Kudlow with Krugman for instance.

[RussianConservative]

Ahh, free moraless credit...backed by bankruptcy lawyer...how we import this model to other economies?

[Starwind]

how we import this model to other economies?

I'm sure the esteemed and newly knighted Sir Alan Greenspan would be happy to consult with them.

[Starwind]

Wall Street loses faith as US holiday sales falter
http://biz.yahoo.com/rc/031216/retail_sales_1.html
Tuesday December 16, 11:42 am ET
By Emily Kaiser

CHICAGO, Dec 16 (Reuters) - Wall Street was losing faith on Tuesday that a recovering U.S. economy would translate into bumper holiday sales, as retailers unleashed another round of steep markdowns in hopes of spurring last-minute demand.

Despite predictions that tight inventories and rising consumer sentiment would help retailers hold back on profit-squeezing clearance sales this year, stores were quick to slash prices at the first sign of sluggish sales.

"The idea that this is going to be a year without any markdowns is ludicrous," said Craig Johnson, president of consulting firm Customer Growth Partners. "You go into some of these stores and in every single aisle there's a sign that says '50 percent off,'" he said.

Sears, Roebuck and Co. (NYSE:S - News) even issued a press release pointing out that "while some experts speculated that this holiday season might not be as promotional as in the past, the promotions are on and Sears is in the game aggressively."

Two of the biggest chains -- Wal-Mart Stores Inc. (NYSE:WMT - News) and Target Corp. (NYSE:TGT - News) -- on Monday said December sales were not as strong as many analysts had hoped.

Home decorating chain Pier 1 Imports Inc. (NYSE:PIR - News) said on Tuesday that December sales were not as good as expected, and it may miss fourth-quarter earnings targets.

"It now seems that only heavy sales in the week before Christmas will rescue the season," said Martin Bukoll, retail analyst with Northern Trust, which holds shares in Wal-Mart, Target and other retailers.

Indeed, with just nine shopping days left until Christmas, trade groups were talking up surveys showing that most people had not yet finished their holiday shopping.

But Wall Street wasn't sold on the promise of a last-minute sales surge. All but three of the Standard & Poor's retailing index (^GSPMS - News) constituents were trading lower on Tuesday morning, while the broader S&P 500 chalked up a small gain.

The retailing index was down 1.5 percent in morning trade, and has shed more than 8 percent since Dec. 1.

"If the last-minute (sales) volume does not materialize, downward earnings revisions will be needed," said J.P. Morgan retail analyst Shari Eberts.

GIVING UP TOO SOON?

The holiday shopping season in November and December accounted for nearly a quarter of retailers' annual sales last year, and some stores earn all of their profits in that period.

In 2002, a weak economy and worries about war in Iraq hurt consumer spending, and the holiday season generated the smallest sales gain in more than 30 years.

This year was supposed to be different. Stellar third-quarter growth and an improving job market were expected to drive a 5 percent to 7 percent increase in holiday sales.

Some industry-watchers say the stock market may be giving up on the holidays too soon, noting that the measures that most analysts use to gauge retail sales can understate demand.

Analysts usually focus on sales at stores open at least a year, which factor out newly opened or remodeled stores. But Wal-Mart and others open hundreds of new stores every year, which don't show up in the same-store sales reports.

And some holiday favorites such as electronics stores and home improvement chains only report sales quarterly, so analysts may be missing holiday strength there too.

Luxury chains like Tiffany & Co. (NYSE:TIF - News) and Coach Inc. (NYSE:COH - News) report quarterly as well, meaning analysts will have to wait until they report earnings in February to get an accurate read on high-end demand.

"The American consumer is much steadier than a lot of these prognosticators or Wall Street types think," Customer Growth's Johnson said. "The overall sales are still going up."

[caa26]

Yes, but what are INTERNET sales for this Christmas shoping season?

[Starwind]

Yes, but what are INTERNET sales for this Christmas shoping season?

A growing but as yet statistically insignificant volume to materially affect overall sales and profits:

US Online Sales Gaining Against Total Retail Sales

Compared to year-ago figures, online retail sales totaled 1.5 per cent of total retail sales, versus 1.2 per cent in Q2, 2003, as the second-largest share of sales since government surveys started in 1999.

[Starwind]

Retail forecasts point to slow holiday
By Neil Buckley in New York
Published: December 17 2003 19:23 | Last Updated: December 18 2003 0:10

Hopes for a strong Christmas retail season took another knock on Wednesday after Best Buy, the biggest US electronics retailer, said it expected fourth-quarter earnings to be below analysts' forecasts and rival Circuit City reported disappointing results.

The cautious outlook from the two consumer electronics merchants came two days after Wal-Mart, the world's largest retailer, said it expected December same-store sales growth - from stores open at least a year - to be at the lower end of its 3-5 per cent forecast range. Target, the number two discount superstore operator to Wal-Mart, also said last week's sales were "below plan".

Best Buy reported third-quarter net income in line with Wall Street forecasts at $122m, or 37 cents a share - the high end of its own recently narrowed guidance - up 42 per cent from $86m, or 27 cents, from ongoing operations a year before.

But it warned that thanks to two consecutive weekends of snow in north-eastern US, revenue trends for the fourth quarter to date were "modestly below expectations". It trimmed its quarterly same-store sales growth forecast to 6-8 per cent, and said it expected quarterly earnings of $1.34-$1.39 - below analysts' $1.41 consensus.

It reiterated its own guidance of $2.35-$2.40 per share for the full year, also slightly below analysts' expectations of $2.41.

Shares of Best Buy, however, closed up 4 per cent at $51.50 in New York, as investors judged that it continued to gain market share while smaller rival Circuit City was losing share in spite of aggressive price promotions.

Circuit City shares closed down more than 7 per cent after it said its third-quarter net loss from continuing operations narrowed from $26.1m, or 13 cents a share, to $24.1m, or 12 cents falling short of expectations of a 7 cents loss.

Adding back results from its credit card business, sold to FleetBoston last month, Circuit City made a $1.5m profit, or 1 cent a share, against a $17.8m, or 9 cents, loss last year.

Analysts said both retailers were coming under pressure from technology groups such as Dell and Gateway moving into consumer electronics manufacturing and retailing, but Best Buy appeared to be coping better.

[Starwind]

DJ Family Dollar Earnings -3: Cuts Dec Same-Store Sales View



Family Dollar cut its same-store sales guidance for the five-week period ending Jan. 3 to between no improvement and a 2% increase from sales in the year earlier period, down from its previous prediction of 2% to 4% same-store sales growth for the quarter.

However, the company noted that its customers usually buy holiday merchandise late in the period, which makes forecasting difficult.

Consumers are expected to shift their focus back to basic consumables in the new year which should help sales to rebound to pre-holiday levels, and push same-store sales growth up 3% to 5% in January and February.


(MORE) Dow Jones Newswires

12-18-03 1041ET- - 10 41 AM EST 12-18-03

[Starwind]

UPDATE - U.S. retailers come up short in last big weekend
http://biz.yahoo.com/rc/031222/retail_walmart_sales_3.html
Monday December 22, 9:23 am ET
By Emily Kaiser

(Recasts first sentence, adds analyst comments, other details, byline)

CHICAGO, Dec 22 (Reuters) - U.S. retailers likely came up short in the biggest shopping weekend of the year, as Wal-Mart Stores Inc. (NYSE:WMT - News) said a last-minute pick-up in holiday sales was not enough to make up for a sluggish start to December.


Analysts on Monday said they saw little reason to change their assessment of the holiday shopping season, which has not delivered on expectations for a strong rebound from last year's disappointing performance.

Target Corp. (NYSE:TGT - News), the second-largest U.S. discount chain, will give its weekly update after the U.S. stock market closes on Monday, which should give investors a broader indication of retail sales trends.

Analysts said anecdotal reports suggested weekend sales were good, but not great, across the sector. The Saturday before Christmas is usually the busiest shopping day of the year for retailers.

Retailers finally got a snowstorm-free weekend after back-to-back weekend white-outs in parts of the U.S. Northeast, but the U.S. Department of Homeland Security raised its color-coded terror alert level to orange on Sunday, its second-highest level, warning of a high risk of attack.

That may have kept some shoppers away from major malls.

Chains were banking on a strong weekend to salvage the season, and rolled out another round of steep discounts in hopes of luring last-minute shoppers.

Wall Street had hoped that an improving job market and strengthening consumer sentiment would drive increased spending, but so far only the luxury retailers have seen a dramatic improvement in demand, analysts said.

"It's probably not going to be as good as we earlier expected, but certainly a lot better than last year," said James Luke, portfolio manager with BB&T Asset Management whose holdings include Wal-Mart shares.

"I'm wondering how much effect this 'orange alert' will have on the final couple of days," he said.

Wal-Mart, the world's biggest company and a barometer of U.S. consumer spending, said it still expects December sales at its U.S. stores open at least a year to reach only the lower end of its forecast for 3 percent to 5 percent gain.

"Although we are not up to our original plan, progress was made over the recent weekend," Wal-Mart said on a recorded message. The retailer said it would provide a post-Christmas update on Friday instead of next Monday as usual.

For the second week in a row, Wal-Mart said fewer people shopped at its stores, although they spent more on average. The best-selling categories last week included pharmacy, electronics, toys, girls' clothing, outerwear and pet supplies.

[Starwind]

Dow Jones Business News
Target's Same-Store Sales Last Week Fall Short
http://biz.yahoo.com/djus/031222/1910001194_1.html
Monday December 22, 7:10 pm ET

CHICAGO -- Target Corp. (NYSE:TGT - News) said its same-store sales for last week were below its plan, both for its discount Target division and for the overall corporation. In addition, same-store sales for the month through Saturday were below its plan, Target said in a recorded message Monday. Target's December same-store sales forecast called for an increase of 5% to 7% at its Target chain, with results expected to be one percentage point lower for the overall company. Target, based in Minneapolis, also owns the Mervyn's and Marshall Field's department-store chains. Same-store sales, or sales at stores open at least a year, are considered a valuable indicator of a retailer's health. At the Target division, the strongest merchandise categories were pharmacy, domestics, household personal and baby, and entertainment. Men's apparel, home decor and electronics were the weakest departments. Stores in the mid-Atlantic and Northeast outperformed stores in the rest of the country. - Amy Merrick, The Wall Street Journal, 312-750-4114

[Starwind]

Wal-Mart says holiday sales at low end
By Neil Buckley in New York
Published: December 22 2003 19:19 | Last Updated: December 22 2003 23:48

Wal-Mart warned on Monday that sales were still tracking at the low end of its target range for December, in the latest sign that holiday retail sales in the US could be lacklustre.

Forecasters and retailers had been looking for a sharp rebound in sales from last Christmas, when, by some measures, sales growth was the slowest for 30 years.

The National Retail Federation, the industry lobby group, forecast total holiday sales would increase 5.7 per cent, year on year - the strongest increase since 1999 - compared with only a 2.2 per cent gain last year. It said on Monday it was sticking to its forecast.

But Wal-Mart, the world's biggest retailer, which accounts for about 8 per cent of non-automotive retail sales in the US, warned for the second week running that sales from stores open at least a year were still towards the low end of its 3-5 per cent projected range.

As in the previous week, it said fewer people visited its stores than in the same week last year, although average purchase sizes were up. The strongest categories included pharmacy goods, electronics, girls' clothing, and outerwear.

The group's sales update covered the period up to last Friday, and Wal-Mart signalled that sales had improved over the latest weekend but it said sales were still "not up to our original plan".

However, other figures were more upbeat. ShopperTrak, which collects data from 30,000 retail outlets, estimated total retail sales last Saturday were up 4.9 per cent over the same Saturday a year before, to $7.3bn. That made it the busiest day of the year so far, ahead of "Black Friday", the day after Thanksgiving, on $7.2bn.

Michael Niemira, lead consultant for ShopperTrak, said Wal-Mart was not benefiting from the biggest trend this season - an increase in spending by the most affluent consumers.

"So often we think of Wal-Mart as a bellwether but they are not this holiday season because the driver for strength has been upscale spending."

Mr Niemira said he did not expect the raising of the US terror alert level to orange to affect sales this week. "I believe we as consumers have got a little bit more accustomed to this. This is not the first time we have seen this happen."

The holiday sales season got off to a solid but unspectacular start in the weekend after Thanksgiving, traditionally considered the start of the season. But two consecutive weekends of snow in the north-eastern US hit sales.

[Starwind]

FYI..several articles posted above since last Tues.

---

Retailers Still Looking for a Big Finish
http://biz.yahoo.com/rb/031222/retail_walmart_sales_5.html
Monday December 22, 6:54 pm ET
By Emily Kaiser

CHICAGO (Reuters) - The biggest shopping weekend of the year did little to ease fears of another lackluster holiday season, as Wal-Mart Stores Inc. (NYSE:WMT - News) said on Monday it still expects December sales to reach only the low end of its forecast.

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The U.S. Department of Homeland Security on Sunday raised its color-coded security alert to orange, the second-highest level, prompting fresh worries that people may stay home on the last three shopping days before Christmas.

Retailers finally got a snowstorm-free weekend after back-to-back weekend white-outs in parts of the U.S. Northeast, but the heightened security situation may have discouraged some shoppers from hitting big malls.

Analysts said on Monday they saw no reason to change their assessment of the holiday shopping season, which has not delivered on expectations for a strong rebound from last year's disappointing performance.

Anecdotal reports suggested weekend retail sales were good, but not great, across the sector. Retailers were banking on a blockbuster weekend after a slow start to December sales.

Bag-toting shoppers packed the sidewalks of New York City's popular retail districts on Monday, from Times Square to Fifth Avenue.

Standing by a jammed sidewalk near Rockefeller Plaza was New York City Detective Chris Montgomery.

"Looking around, I don't think the terror alert deterred anybody," Montgomery said, peering over a long line of people waiting to skate under the plaza's Christmas tree.

Target Corp. (NYSE:TGT - News), the second-largest U.S. discount chain, said December sales at stores open at least a year were running below expectations for the week ended Dec. 20 for the total corporation and at its namesake discount stores.

Minneapolis-based Target had forecast a 5 percent to 7 percent rise in December same-store sales at Target stores.

The Saturday before Christmas has been the busiest shopping day of the year for at least the last six years. But retailers are also counting on big Monday crowds because in 2002, the Monday before Christmas was the second-busiest shopping day.

Increasingly popular plastic gift cards have made it easier for procrastinators to delay holiday shopping even longer because they can quickly grab a one-size-fits-all gift just about anywhere -- including many supermarkets.

The Standard & Poor's retailing index (^GSPMS - News) fell 0.33 percent. Wal-Mart's stock rose 72 cents, or 1.38 percent, to $53.07. The retailer's shares had fallen sharply last Monday, when Wal-Mart first said December sales would likely hit the low end of its forecast.

Wall Street had hoped that an improving job market and strengthening consumer sentiment would drive increased spending, but so far only the luxury retailers have seen a dramatic improvement in demand, analysts said.

"It's probably not going to be as good as we earlier expected, but certainly a lot better than last year," said James Luke, portfolio manager with BB&T Asset Management whose holdings include Wal-Mart shares.

"I'm wondering how much effect this 'orange alert' will have on the final couple of days," he said.

Wal-Mart, the world's biggest company and a barometer of U.S. consumer spending, said it still expects December sales at its U.S. stores open at least a year to reach only the lower end of its forecast for 3 percent to 5 percent gain.

"Although we are not up to our original plan, progress was made over the recent weekend," Wal-Mart said on a recorded message. The retailer said it would provide a post-Christmas update on Friday instead of next Monday as usual.

Prudential Securities analyst Wayne Hood maintained his forecast for a 3.1 percent same-store sales increase at Wal-Mart. He lowered his outlook last week.

For the second week in a row, Wal-Mart said fewer people shopped at its stores, although they spent more on average. The best-selling categories last week included pharmacy, electronics, toys, girls' clothing, outerwear and pet supplies.

(Additional reporting by Michael Flaherty )

[Tauzero]

Traffic in my area has been absolutely insane.

Still, doesn't necessarily mean folks are spending all that much.

Say, when are gift cards booked as revenue? When bought, or when used? Or is that at the accountant's discretion?

[Starwind]

Say, when are gift cards booked as revenue? When bought, or when used?

If they are not redeemable/refundable, I would imagine they are booked as deferred income when bought and recognized as revenue when a purchase is charged against them.