September sales better than expected; Limited Brands and Abercrombie lead apparel
New York City Many retailers on Thursday reported better-than-expected sales results for September, helped by a late burst of back-to-school shopping. Based on an aggregate of analysts’ estimates for 30 chains, same-store sales gained 2.3% last month, according to Retail Metrics. The solid results were surprising in that many retailers were up against difficult comparisons from last September, when retailers began to see some relief from the downturn.
“An upside surprise bodes well for the holiday season,” said Ken Perkins, president, Retail Metrics, Swampscott, Mass., in a Bloomberg report. “Back-to-school has a pretty strong correlation to holiday.”
The results, however, weren't strong across the board. Target, Gap and BJ Wholesale were among the retailers that fell short of analysts' estimates. Also, some analysts cautioned that sales may have been more heavily weighted to the first half of the month, raising questions about October, and the holiday shopping season.
In the apparel sector, Abercrombie & Fitch Co.’s same-store sales climbed 13% in September, helped by strong international sales. The results soundly beat the 3.6% increase analysts surveyed by Thomson Reuters predicted.
Total international sales, which include direct-to-consumer sales, surged 94% to $60.3 million for the fiscal month. At Hollister Co., same-store sales rose 9%. This same metric rose 24% at abercrombie kids and 13% at the company's namesake stores.
Limited Brands also exceeded the Street, reporting that a 12% rise in same-store sales for September at stores open at least one year rose 12%. Analysts, on average, had expected same-store sales to rise 4%. Net sales for the five weeks ended Oct. 2 rose 12.4% to $735.8 million, from $654.8 million in the year-ago period.
At Gap, total same-store sales fell 2%, dragged down by Old Navy. Same-store revenue at Gap stores fell 1%, while Banana Republic same-store revenue was flat, compared with a 12% decline last year. But sales at Old Navy sales dropped 5%. Total Gap sales rose 1% to $1.34 billion.
- American Eagle Outfitters’ sales rose 4% as the chain also lifted its third-quarter earnings guidance. Analysts, on average, had expected same-store sales to fall 0.8%. Total sales for the five weeks ended Oct. 2 rose 4% to $251 million.
- Aeropostale beat estimates with a gain of 3%, compared with a projected fall of 2.3%.
- Buckle's sales rose 3% in September, surprising Wall Street. Analysts surveyed by Thomson Reuters anticipated a 4.7% decline for the teen retailer.
- Wet Seal's revenue dipped 0.7% in September, pinched by lower sales at Arden B. But the results were better than Wall Street expected, and the young women's retailer to give a rosier outlook for the third quarter.
- Cato Corp.’s sales rose 2%, better than expected.