Retail results were generally positive for December

Retail results were generally positive for December

Santa delivered some generally positive holiday sales results to US apparel retailers in December as they grappled with a rapidly changing omnichannel landscape, low and middle income consumers with limited discretionary spending power, and a very mild autumn that depressed clothing sales.

According to first figures from research firm Retail Metrics, comparable store sales for the US retail sector increased a modest 0.9%, but beat its expectations for a 0.5% increase.

Retail Metrics president Ken Perkins explained that while figures for the holiday season were better than feared, consumer spending patterns shifted to big ticket items such as cars, playstations, and experiences. 

Winners and losers

Zumiez was by far the worst performer during the month, posting an 8.9% comparable store sales decline, driven by lower comparable transactions partially offset by higher dollars per transaction. Gap Inc wasn't far behind with a 5% decline, pulled down by 9% slump at its Banana Republic brand. Old Navy reported a 7% drop and Gap's namesake brand fell 2%. 

Stein Mart managed to record a 1.8% increase, on top of a 5.8% comparable store sales increase last year. This was despite unseasonably warm weather, which impacted traffic and sales.

Jay Stein, CEO, said: "We continue to have a positive outlook on our important fourth-quarter holiday sales which will include incremental sales from six new stores opened through the third quarter plus four more new stores opening in November."

L Brands was the clear standout performer in December, with the Victoria's Secret, Pink, and Bath & Body Works stores helping deliver the company's "best December ever". Merchandise margin was roughly flat for the overall company year-on-year, and up at Bath & Body Works, but down at Vicoria's Secret.

The Cato Corp said its 6% comparable store sales rise was above expectations and original guidance. But chairman, president and CEO John Cato warned: "We still remain cautious for the remainder of the quarter due to unfavourable sales comparisons to last year."

December sales overview

At action sportswear and footwear retailer Zumiez, comparable store sales slumped 8.9% during the five weeks to 2 January. The company, which operates 659 stores, said net sales declined 6.2% to $134.5m from $143.4m in the same period a year ago. 

Denim specialist The Buckle saw comparable store sales, for stores open at least one year, decline 5.4%. The company, which operates 469 stores, said net sales fell 4.5% to $182.1m from $190.6m in the prior year period. 

For value-priced fashion retailer Cato, December comparable store sales climbed 6%. The owner of the Cato, Versona and It's Fashion brands said net sales increased 9% to $118.5m from $109.2m last year. 

L Brands, owner of the Victoria's Secret, Pink and La Senza brands, booked net sales of $2.42bn, up 9% from $2.21bn a year ago. Comparable store sales grew 8% during the four week period. 

Off-price fashion retailer Stein Mart saw comparable store sales increase 1.8%. Net sales grew 4.7% to $198.3m from $189.5m in the prior year for the company which operates 278 stores. 

And Gap reported a 5% decline in comparable store sales, weighed down by a decline at Banana Republic. The company, which operates 3,300 stores, said net sales were down 4% to $2.01bn from $2.10m last year.