Consumers were challenged by higher fuel prices, summer dejection and a lack of wage gains in July

Consumers were challenged by higher fuel prices, summer dejection and a lack of wage gains in July

The majority of US apparel retailers posted same-store sale gains last month - albeit below analyst expectations - despite higher fuel prices, summer doldrums, pay roll tax increases, and a lack of wage gains ahead of the back-to-school season. 

According to research firm Retail Metrics and The International Council of Shopping Centers (ICSC), same store sales increased 4.4% in July.

Although the ICSC noted that the year-on-year growth was the strongest since January, Retail Metrics said the mixed results raises some cause for concern, with more retailers missing expectations than exceeding them during the challenging trading environment.

"While July is a transitional/clearance month and not one of the more important sales months, broad based softness across the retail sector have raised a cautionary flag as we turn the corner into the rapidly approaching key Back-to-School selling weeks," said Retail Metrics president Ken Perkins.

However, Michael Niemira, vice president of research and chief economist for ICSC, noted: "July sales were very solid despite a slow start to the back-to-school season, which we anticipated based on the ICSC - Goldman Sachs BTS consumer survey conducted last month."

Looking forward, he added that the ICSC survey suggests the majority of consumers will begin their back-to-school shopping in August, which bodes well for sales the sales pace seen over the past two months to continue.

Winners and losers
All but one retailer reported comparable store sale increases during the month, with the Cato blaming "continuing economic uncertainty" and "related volatility" for a 5% decline.

However, the value-priced fashion apparel retailer now expects second-quarter earnings per share to be at the high end of its original guidance of 0.42-0.48, but down from $0.59 last year.

Stein Mart, meanwhile, was pleased with its July sales performance, which "wrapped up a great second quarter where our comparable store sales increased 6.4%", said CEO Jay Stein.

Linens, dresses and intimate apparel posted the strongest sales during the month, while ladies' special sizes, men's sportswear, jewellery and ladies' casual sportswear were more challenged. Geographically, July sales were strongest in Florida, the Southeast and Virginia, while the West performed slightly lower than the chain.

"Our customers responded well to our merchandise assortment during the first half of the year and we are looking forward to introducing her to our great fall assortment," Stein added.

US retailers' July 2013 sales roundup 
Action sportswear and footwear retailer Zumiez posted a 19.3% increase in total sales to reach US$56.1m during the four weeks to 3 August, up from $47m in the same period last year. The company, which operates 529 stores across the US, Canada and Europe, saw comparable store sales rise 0.8%.

At value-priced fashion apparel retailer The Cato Corporation, sales reached $61.6m, down 3% on $63.4 the prior year, reflecting the volatile market conditions throughout the year. Same-store sales in July were down 5% at the company, whose brands include Cato, Versona and It's Fashion.

Limited Brands (now known as L Brands) said sales during the month grew 4.4% to $678.4m, compared to $649.8m in the previous year. The company, which owns the Victoria's Secret and La Senza lingerie brands, saw comparable store sales rise 3% during the four week period.

For denim specialist The Buckle, comparable store sales climbed 2.1% in July. The Kearney, Nebraska-based company, which operates 452 retail stores across the US, posted a net sales increase of 16.7% to $77.2m from $66.2m in the prior year.

Off-price fashion retailer Stein Mart recorded a 5.8% increase in July sales to $74.6m, compared to $70.5m in the same period last year. Comparable store sales were up 3.7% for the company, which operates 262 stores.

And specialty clothing retailer Gap Inc said sales reached $1.12bn for the four weeks to 28 July, up 5.7% on $1.06bn in the prior year. The company, which operates around 3,100 stores, saw comparable store sales edge up 1% last month, helped by a 7% gain at Gap, which offset a 5% decline at Old Navy and a 1% drop at Banana Republic.