(Filed Under Financial and General Interest News). With consumers cutting back on discretionary spending, an unseasonably cool and rainy season, and no stimulus checks this May, retailers across all channels of distribution experienced lower-than-expected same-store sales this June. According to reports, the apparel market was particularly impacted by this trend.
Teen retailers were especially affected, which analysts and companies partially attributed to fewer teenagers getting jobs this summer than in recent years. Hot Topic, Inc. reported a comparable store sales drop of 7.9 percent, lowering its guidance for the second quarter ending August 1st to 7 to 9 cents from 4 to 6 cents per share. The Wet Seal dropped 11.1 percent, lower than the approximate 9.1 percent that analysts interviewed by Thomas Reuters had predicted. The ailing Abercrombie & Fitchwhich hasn't reported any sales growth since April 2008experienced a 32 percent drop. Analysts had predicted a decline of approximately 26.6 percent.
Luxury retailers were also highly affected, with Neiman Marcus down 23 percent. Saks beat out estimates of an 11.8 percent drop with a decline of 4.4 percent, and Nordstrom sales fell 10 percent, narrowly beating out estimates of an 11.1 percent drop. The parent company of Victoria's Secret, Limited Brands, dropped 7 percent.
Although discount retailers have fared better than others during the recession, they were not immune to this June's climate with the exception of TJX whose sales rose 4.4 percent, beating out estimates. The company's president and CEO, Carol Meyrowitz, attributed strong sales to their strategies of "buying close to need" and implementing "lean inventories," and the company rose its second quarter guidance to 56 to 59 cents from 48 cents per share. Same-store sales at JC Penney dropped 8.2 percent, while Target's fell 6.2 percent. Wal-Mart, which has consistently posted sales increases despite the recession, did not report June sales.
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