just-styles round-up of holiday apparel and footwear industry results

just-style's round-up of holiday apparel and footwear industry results

It's been a mixed bag of holiday sales filings from US apparel and footwear brands and retailers as they continue to navigate the impact of the Covid-19 pandemic. Target Corp has reported a 17.2% jump in comparable sales for the combined November/December period, while Genesco has posted a 3% comparable sales decline for the eight weeks to 26 December. Elsewhere, Urban Outfitters has reported an 8.4% decline in total company net sales, and L Brands said the group's holiday results significantly exceeded initial expectations.

Citi Trends

For the nine weeks ended 2 January, total sales increased 12.9% to US$192.5m from $170.5m a year earlier. Comparable store sales were up 10.3% versus 3.6% in the year ago period. "We are thrilled with our holiday sales results that significantly exceeded our expectations," said Citi Trends CEO David Makuen. "We continue to drive meaningful gross margin and operating margin expansion fuelled by full-price selling and accelerated inventory turns." Citi Trends is now forecasting positive comparable store sales in the low double-digit range for the fourth quarter, and diluted earnings per share of $1.22 to $1.32 on an adjusted basis. For the full year, total sales are forecast to be only slightly below 2019 total sales, despite the store closures due to Covid-19.

Nordstrom

Nordstrom announced a net sales decline of about 22% for the nine-week holiday period ended 2 January compared with last year. Combined November and December sales were in-line with company expectations for a decrease in the low-twenties percentage range for the fourth quarter. Sales trends increased sequentially by approximately 500 basis points relative to the third quarter, after adjusting for the shift of the Nordstrom anniversary sale from the second quarter to the third quarter in fiscal 2020. Digital sales grew 23% over last year and represented 54% of total sales compared with 34% a year prior. 

Target Corp

Target said comparable sales grew 17.2% in the combined November/December period compared with last year, reflecting comparable store sales growth of 4.2% and comparable digital sales growth of 102%. Traffic increased 4.3% and average ticket increased 12.3%. The company continued to gain market share in all five of its core merchandise categories, with sales growth strongest in home and hardlines. Apparel delivered comparable sales growth in the high-single-digit range.

Zumiez

Specialty retailer Zumiez said its comparable sales increased 1.7% for the ten-week period ended 9 January compared to last year. During the same period, total sales decreased 0.7% impacted by required governmental closures and other restrictions associated with the Covid-19 pandemic. From a regional perspective, quarter-to-date North America net sales increased 0.2% with the US up slightly while Canada was significantly impacted by store closures. Other international net sales, which consists of Europe and Australia, decreased 6.7% with Europe being the hardest hit by store closures and Australia performing extremely well during the holiday period. Excluding the impact of foreign currency translation, North America net sales edged up by 0.1% and other international net sales decreased 14.2% quarter-to-date.

CEO Rick Brooks said in light of the headwinds, the company is pleased that comparable sales were up 1.3% in December and have been up double digits thus far in January signaling a strong final month of the year. 

Urban Outfitters

Urban Outfitters has reported an 8.4% decline in total company net sales for the two months ended 31 December over the same period last year. Comparable retail segment net sales decreased 9% due to negative retail store net sales as stronger conversion rates could not offset the reduced store traffic as a result of the coronavirus pandemic and related restrictions. Lower store net sales were partially offset by strong double-digit growth in digital channel sales. By brand, comparable retail segment net sales increased 1% at Free People and decreased 8% at Urban Outfitters and 12% at the Anthropologie Group. Wholesale segment net sales decreased 1%. 

Although retail segment comparable net sales have "rebounded nicely" in the month of January, Urban Outfitters expects total company gross profit margins for the fourth quarter to deleverage by several hundred basis points driven by the deleverage in delivery and logistics expenses due to the increased penetration of digital sales, carrier surcharges, and increased expedited shipments; and deleverage in store occupancy expense due to negative store net sales. 

The company has also announced Trish Donnelly, CEO of the Urban Outfitters Group, will be leaving the company on 31 January to pursue a new career opportunity.

Genesco

Genesco said comparable sales, including both stores and direct sales, decreased 3% for the eight-week quarter-to-date period ended 26 December. Same-store sales decreased 14%, while those for the company's e-commerce businesses increased 49% on a comparable basis. Genesco's comp policy removes any stores that are closed for seven consecutive days or more. Therefore, comparable sales results exclude periods of time that stores were closed for seven consecutive days or more as a result of the Covid-19 pandemic. Overall sales, meanwhile, decreased by 8% for the quarter-to-date period. Overall sales were down 5% for Journeys, 9% at Schuh, and 38% at Johnston & Murphy, while sales were up 201% at Licensed Brands.

CEO Mimi Vaughn said: "Overall, our performance this holiday selling season was very encouraging given the backdrop of the Covid-19 pandemic with sales coming in above our expectations. Journeys once again led the way with strong full-price selling, and we were pleased that Schuh delivered better than expected results especially as the business continues to face significant mandated store closures. Fiscal January is off to a strong start with comps turning nicely positive, providing us with optimism for a solid finish to Fiscal 2021."

Tilly's

Tilly's has reported a 3.3% rise in total net sales for the 2020 holiday period to US$148.7m from $143.9m last year. For the nine-week period ended 2 January, total comparable net sales, including both physical stores and e-commerce, increased by 2.7% compared to a 2% decline a year prior. Comparable net sales of footwear, womens, and mens increased compared to 2019, partially offset by decreases in boys, accessories, and girls. Comparable net sales in physical stores were down by 12.4%, with decreases in all geographic markets. Net sales in physical stores represented 69% of total net sales, compared to 80.5% last time. E-commerce net sales, meanwhile, surged 65.2% for the 2020 holiday period compared to an increase of 1% last year. E-commerce net sales increased across all 50 states over the nine weeks and represented 31% of total net sales. This was up from 19.5% in 2019.

L Brands 

L Brands CEO Andrew Meslow said the group's holiday results significantly exceeded initial expectations, driven by an increase in profitability at both Bath & Body Works and Victoria's Secret. The group reported net sales of US$3.84bn for the nine weeks to 2 January, compared to $3.91bn last year, while comparable sales were up 5%. At Bath & Body Works, comparable sales increased 17%, including a comparable sales increase of 5% in stores and 64% sales growth in the direct channel. At Victoria's Secret, comparable sales decreased 9%, including a comparable sales decrease of 23% in stores and 24% sales growth in the direct channel. L Brands currently expects to report fourth-quarter earnings per share between $2.70 and $2.80.