US retail saw strong holiday shopping season

Monday, 10 January 2011
US retail sales delivered its strongest performance since 2006 over the two months of the holiday shopping season, despite not meeting Wall Street expectation. The International Council of Shopping Centers, which tracks monthly sales data of 32 retailers, said its index of December same-store sales, delivered on Thursday, rose 3.1 per cent against a year ago, but short of the 3.5 per cent rise expected by analysts.

However, its index for November and December together was up 4 per cent against last year, the most robust growth in the holiday shopping season in four years.

Terry Lundgren, chief executive of Macy’s, the country’s largest traditional department store chain, said sales at its Macy’s and Bloomingdale's outlets during November and December rose 4.6 per cent, with December sales “consistent with our high expectations”. This was despite the snow that hit the east coast after Christmas.

JC Penney, its lower-cost rival, said it had a “successful” holiday season, with comparable store sales up 5.7 per cent against the previous year.

But Gap, the largest speciality retailer, reported a 3 per cent drop in comparable store sales growth during December against last year.

Sabrina Simmons, chief financial officer, said that “after a strong start to the holiday season in November, sales and traffic trends for our brands were less consistent in December”.

American Eagle and Aero postale, the youth fashion retailers, reported comparable sales declines of 11 per cent and 5 per cent, respectively, in December.

Target, the discount chain, saw comparable sales rise just 0.9 per cent against last December. Gregg Steinhafel, chief executive, said the month’s sales “were below expectations, as strength in grocery and apparel was offset by softness in electronics, toys and some home categories”.

However, there was evidence that more prosperous Americans are spending again on discretionary purchases, and so more upmarket retailers continued to outperform the rest of the sector in December.

Image: Macy's
Source: FT©

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