Wednesday saw two big losers in Maidenform Brands (-3.7%) and Esprit (-7.2%) as both posted revenues decreases and worst-than-expected figures. On the other extreme, Macy's, with an impressive 38% hike in its quarter profit, what lifted by 5% irs stock in early trading. Meanwhile, report showed mid-tier retailers’ like-for-like sales down by just 0.8% year-on-year, despite gloom weather.
The latest figures from the BDO High Street Sales Tracker show mid-tier retailers’ like-for-like sales down by just 0.8% year-on-year. Cold, wet weather inevitably hit fashion retailers hard (down 4.6% year-on-year) as the few shoppers to brave the rain eschewed stocks of lighter spring and summer lines in favour of garments left-over from winter.Shopping from home boosted year-on-year sales by 29%, echoing recent trends reported by major retailers such as Next and Debenhams.Don Williams, National Head of Retail and Wholesale at BDO LLP, said the figures were "nowhere near as bad as some had suggested". "The lead times for much of the high street, especially fashion, means many can’t react to unseasonal weather in the way that something like the grocery sector can. This combined with the continued pressure on disposable income meant that we weren’t expecting sales to grow," said Williams. "But the fact the numbers were down less than 1% shows people are still spending money despite feeling the financial pinch."
Williams also warned retailers not to let poor weather lead them to complacency: "Struggling retailers will find it all too easy to hide behind the rain, but the sun coming out won’t reverse their fortunes if they aren’t working hard for every sale and making sure their online offer is as good as it can be."
In Wall Street, Macy's Inc. reported a 38% increase in its first-quarter profit as the department store chain continues to reap benefits from its move to tailor its fashions to local markets. The earnings beat market's expectations. However, its shares fell more than 5% in morning trading Wednesday as Macy's failed to make a conforming boost in its earnings guidance for the year, reported AP. Investors were hoping that Macy's would benefit from rival J.C. Penney's period of transition since the new pricing will take time to resonate with shoppers, who are used to racks of discounts. J.C. Penney's pricing strategy is part of an overall transformation spearheaded by its new CEO Ron Johnson, reported 'Crain NYC'.
Macy's reaffirmed its earnings guidance for the year of $3.25 to $3.30 per share whereas analysts predicted $3.39 per share, according to FactSet. Macy's shares fell $2.04, or 5.1%, to $37.47 in morning trading. They peaked for the past year at $42.17 a week ago.
Also Maidenform Brands, Inc. (NYSE: MFB), reported first quarter 2012 net sales, hitting $157.5 million, a decrease of 3.7% below the first quarter of 2011. Reported EPS was $0.25 for the first quarter of 2012 compared to EPS of $0.62 for the first quarter of 2011. "We modestly beat our sales and earnings expectations for the quarter and our outlook for the year remains on track," stated Maurice S. Reznik, Chief Executive Officer. "Despite a choppy retail environment for women's intimate apparel, we grew domestic share across channels and categories in the first quarter, which reflects the power of our brands and the relevance of our products." Net sales for the first quarter of 2012 decreased $6.1 million, or 3.7%, to $157.5 million. Wholesale segment net sales for the first quarter of 2012 decreased $7.2 million, or 4.7%, to $144.8 million. Retail segment net sales increased $1.1 million, or 9.5%, to $12.7 million.
Finally, Esprit Holdings Ltd. said Wednesday its revenue for the first nine months of its fiscal year fell 7.2%, weighed by continued weakness in its wholesale business and European sales. Revenue fell to HK$24 billion (US$3.09 billion) from HK$25.86 billion in the nine months ended March 31 and mainly weighted by Europe - which accounted for 79% of total revenue, and fell 7.8% in Hong Kong-dollar terms, according to a statement to the Hong Kong stock exchange. The group's wholesale business was its worst-performing distribution channel, with revenue slipping 13% during the period, the statement said.