Retail Sales Gain Just 4% in November
U.S. retailers’ same-store sales rose a less-than-expected 4% in November as shoppers shunned coats and winter clothing because of unusually balmy weather.
The gain from November 1998, calculated by the Bank of Tokyo-Mitsubishi Ltd., fell shy of its forecast of a 4.5% to 5% rise in sales at stores open at least a year.
Department and specialty stores that carry mostly clothing fared the worst, including J.C. Penney Co., with an 8.7% drop, and Gap Inc., with a rise of just 1%. Brisk demand for Pokemon toys, electronics and jewelry lifted sales 5.6% at Wal-Mart Stores Inc. and 5.9% at Sears, Roebuck & Co.
Retailers should still meet holiday forecasts for a rise of about 5% in sales, analysts said. The weather has turned cooler and sales have remained strong since the Thanksgiving weekend, the start of the holiday shopping season.
“There was a noticeable turn in the final week as the consumers did go to the malls--and that has continued,” said PaineWebber analyst Jeffrey Edelman.
Retail stocks fell. Standard & Poor’s index of apparel stores fell 5.9% on declines at Gap and TJX Cos.
November’s rise in same-store sales trailed increases of 5.7% in October and 6.7% in September and the 4.5% gain last November.
Gap was hurt by a decline in sales at its Old Navy chain, which had been the company’s best-performing unit in recent months. Gap shares fell 88 cents to close at $43.13 on the New York Stock Exchange.
Federated Department Stores Inc.’s sales rose 1.1% at its Bloomingdale’s, Macy’s and other chains, as forecast. Sales strengthened in the final week of November, Federated said. The Cincinnati-based company is “cautiously optimistic” for a good holiday season, Chief Executive James Zimmerman said.
Dayton Hudson Corp. said sales dropped 11% at Mervyn’s, a chain that relies heavily on promotions, and 4.8% at its department store division, which includes Dayton’s, Hudson’s and Marshall Field’s.
Sales at the company’s Target discount chain, which generates at least 70% of Dayton Hudson’s revenue, rose 5.2%. Its shares fell $1 to close at $68.63 on the NYSE.
Saks Inc., owner of the upscale Saks Fifth Avenue and regional department store chains, said sales rose 1%. The company said it expects combined sales for December and January to rise 4.5%.
May Department Stores Co. said sales were unchanged, as projected by analysts. Sales dropped 3% at Dillard’s Inc., a Little Rock, Ark.-based department store operator.
J.C. Penney’s sales drop was in line with forecasts for a decline of as much as 9%. The retailer, which operates about 1,150 department stores, said sales were “soft in most apparel categories,” especially outerwear and seasonable merchandise.
The exceptions among clothing retailers included Limited Inc. and Talbots Inc., which carry career-wear, dressy clothes for the holidays and other items not as sensitive to weather.
Sales rose 5% at Limited, the owner of Express and Structure, topping forecasts that ranged from a decline of 1% to a gain of 2%. Talbots sales rose 7.9%.
Kmart Corp., the second-biggest U.S. discount chain behind Wal-Mart, said sales rose 1.4%. Its results include sales for the four weeks ended Nov. 24, before Thanksgiving.
Including results from the Friday and Saturday after Thanksgiving, sales would have increased 2.4%, Chairman Floyd Hall said.
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Top Retailers
A look at the percentage change of major retailers’ sales for this November compared with a year ago.
Sears Roebuck : +5.9%
Wal-Mart: +5.6
Limited: +5.0
Dayton Hudson: +1.8
Kmart: +1.4
Federated Dept. Stores: +1.1
Gap : +1.0
Saks: +1.0
May Dept. Stores: 0
TJX: --1.0
Dillard’s: --3.0
J.C. Penney: --8.7
Source: Associated Press
