Winter storms were blamed for comparable store declines last month

Winter storms were blamed for comparable store declines last month

Winter storms played havoc with US apparel retailers in January, forcing many shoppers to stay at home. But while some consumers were physically unable to spend, others simply lost the will, with holiday shopping fatigue, static wages, and a lack of inspiring new ranges all hitting comparable store sales.

Of the apparel retailers reporting monthly sales updates, just L Brands (formerly Limited Brands) and Gap Inc reported comparable store sales growth in January.

That said, overall comparable store sales for the retail sector were up 3.1%, according to first figures from Retail Metrics - beating its lowered expectations for a modest 2.2% rise. This compares with a 3.5% increase in December, which is traditionally viewed as the most important month for retailers.

"Adverse weather, a dearth of fashion, lack of income gains, holiday shopping fatigue, and no spending catalysts in the end failed to impact all retailers - but they did keep a lid on sales gains and while hurting a number of retailers," said Ken Perkins, president of the research firm.

The International Council of Shopping Centers (ICSC) was slightly more upbeat about the month's retail performance, with a 3.5% year-on-year comparable store sales increase.

"Adverse and abnormal weather can exacerbate seasonally low sales volumes in January and February," said Michael Niemira, chief economist and vice president of research at ICSC.

"Such was the case for this past January - especially in the eastern part of the country - where various snowstorms hindered consumers' ability to shop. Despite that, comparable-store sales posted a moderate gain in January - in line with its prior month performance."

Winners and losers
As well as booking an impressive 9% increase on comparable store sales in January, L Brands now expects its fourth-quarter earnings per share to be slightly above its earlier guidance of $1.60.

At Gap Inc, comparable sales edged up 1%, with a 1% rise at its namesake brand and 4% growth at Old Navy offset by a 10% fall at Banana Republic.

But chairman and CEO Glenn Murphy said: "We're pleased to deliver a strong finish to the year, with another month and quarter of comp sales growth."

Teen apparel chains Zumiez and The Buckle both missed Retail Metrics' expectations, with respective 7.6% and 6.6% comparable store sale declines.

The Cato Corporation, meanwhile, blamed its 8% comp decline on winter storms. But the retailer reaffirmed its fourth-quarter and full-year earnings guidance to be $0.11-0.15 and $1.84-1.88 respectively.

Despite posting a decline in both comparable store sales and net sales for January, Stein Mart CEO Jay Stein said: "I am very pleased to report our seventh consecutive quarter of comparable store sales increases and an annual increase that is 1% better than our strong performance last year." 

"Our January sales were clearly impacted by the severe weather throughout most of the country. Factoring this out, our sales results for January were consistent with our performance through year-to-date December."

US retailers' January 2014 sales roundup
Action sportswear and footwear retailer Zumiez posted a 7.6% fall in comparable store sales for the four weeks ending 1 February. The company, which operates 551 stores, said net sales declined 24.3% to $38.1m from $50.3m in the same period of the prior year.

Denim specialist The Buckle said January comparable store sales slip 6.6%. Net sales slumped 27.9% to $56.9m from $78.8m in the previous year for the company, which operates 449 retail stores across the US.

Over at value-priced fashion retailer The Cato Corporation, total sales declined 25% to $48.1m during the four-week period, from $63.8m last year. The company, whose brands include Cato, Versona and It's Fashion, saw comparable store sales fell 8%.

L Brands said net sales were down 25% to $731.2m in January, compared to $986.4m in the prior year period. Comparable store sales, however, increased 9% for the company which owns the Victoria's Secret, Pink and La Senza stores.

For off-price fashion retailer Stein Mart, comparable store sales edged down 0.7%. Net sales declined 18.4% to $64.4m from $78.9m in the previous year for the company, which operates 264 stores. Linens, ladies' boutique and gifts posted the strongest sales for the month, while jewellery, ladies' sportswear and men's all lagged.

And clothing giant Gap Inc reported a 1% rise in January comparable store sales, helped by growth at two of its three brands. However, the San Francisco-based retailer, which operates around 3,100 stores, saw net sales decline 20.4% to US$899m from $1.13bn last year.