Target falters as discounters report a mixed bag in November
New York -- Discounters, which are expected to fare well this holiday season, showed mixed results in November. TJX Cos. reported Thursday that November same-store sales climbed 3%, missing Wall Street’s expected 3.6% rise but beating the retailer’s internal expectations.
Target Corp. saw same-store sales fall in November, hurt by weak sales during the first two weeks. Comps dipped 1%, while Wall Street expected a 2.1% gain. Revenue for the month was essentially flat.
“November sales were below our expectations, reflecting weaker-than-planned sales performance in the first two weeks combined with stronger sales growth across all channels later in the month,” said Gregg Steinhafel, Target chairman, president and CEO. “Profitability for the month remained on plan, reflecting our efforts to balance thoughtful price investments in an intensely competitive environment with our continued focus on driving sales.”
Steinhafel sought to reassure investors disturbed by the November performance that the best is yet to come from the company and indicated same store sales for the five week December reporting period would increase in the low single digits.
“With the upcoming launch of the Target/Neiman Marcus Holiday Collection, our unique assortment of exclusive, affordable merchandise and the compelling benefits of 5% REDcard Rewards and our Holiday Price Match, we believe Target has the right plans in place to allow our guests to shop with confidence throughout the holiday season,” Steinhafel said.
As in prior months, Target’s strongest growth came in the food category which produced a mid single digit increase and in health and beauty which experienced a low single digit increase.
Costco Wholesale Club reported Wednesday that its same-store sales rose a better-than-expected 6%.
Among other discounters:
• Ross Stores reported a 2% rise in November comps;
• SteinMart was up 7.1%; and
• Fred’s dropped 3.6%.