Luxury leads the way in May
NEW YORK — A sluggish economy, cool weather and high prices at the pump tempered retail sales in May, as retailers reported mixed results for the month. Retail Metrics projected an increase of 5.1% for the 25 chains tracked, which would mark the 21st straight monthly gain from September 2009.
Retailers who turned in strong performances in May included Macy’s, with a 7.4% rise in same-store sales when a 5.6% increase was expected. The company lifted its full-year same-stores sales estimate.
"The consumer is still in slow recovery mode," said FBR Capital Markets analyst Liz Dunn. "They are being selective ... and really consolidating purchases around places where they feel like there is better fashion."
The luxury segment continued to show signs of a strong recovery as both Saks and Nordstrom outdid expectations. Saks’ same-store sales climbed 20%, easily topping the consensus estimate calling for a 6.5% increase. Strong categories at Saks Fifth Avenue stores for the month included women's designer apparel, shoes, handbags and accessories; men's clothing, shoes and accessories; jewelry; cosmetics; and fragrances.
Nordstrom reported a 7.4% increase, better than analysts had expected.
Lower-priced department stores did not fare as well. Both JCPenney and Kohl’s turned in disappointing performances. JCPenney Co.’s same-store sales fell 1%. Analysts had forecast a 3.3%. The chain said bad weather, shifting some promotions and eliminating others weighed on its sales and traffic. Stronger categories included children's and women's clothing and accessories and the in-store Sephora beauty boutiques.
Kohl's Corp.'s same-store sales rose 0.8%, compared with analysts’ forecasts for a 2.8% increase. The retailer said its best performing categories were accessories, home and children's. The strongest regions included the Mid-Atlantic, Northeast and Southeast.
In the specialty apparel segment, Zumiez continued on its hot streak, reporting a slightly better-than-expected rise of 7.8%. The Buckle also outdid expectations, as sales increased 8.8%.
Gap’s same-store sales fell 4% in May, missing analysts' estimates for a 1% decline. North America, sales fell the most at Banana Republic stores -- a 6% decline, compared with a 4% decline at Gap and a 1% decline at Old Navy. International revenue fell 9%.
Limited, operator of the Victoria’s Secret chain, posted an increase of 6%, below the analysts' average forecast of 7%. Wet Seal also fell short of analysts’ expectations, with a 2.9% increase.
Hot Topic said its same-store sales edged up 0.4%, as revenue dropped at its Hot Topic stores.
TJX Cos. reported a 2% increase in same-store sales, in line with its expectations.