January Sales Slow

Retailers typically regard January as a clearance month, a period of time to slog through while focusing on the important business of upcoming Spring fashion. However, January did not start the year with much cheer.

Retail sales declined 0.9 percent, according to an index maintained by Boston-area market-research company Retail Metrics. “Traffic and conversion looked uninspiring across the mall for most of the month as consumers took a breather from holiday spending,” Retail Metrics’ Ken Perkins wrote in a Feb. 4 note.

All of the companies followed by California Apparel News’ index reported a same-store-sales decline in January. Retail giant Gap Inc., which is typically included in the Apparel News’ monthly sales chart, is reporting its January sales results on Feb. 8.

Mall-based retailer The Buckle Inc. reported that its same-store sales declined 11.3 percent in January compared with last year. Off-pricer Stein Mart Inc. posted a same-store-sales decline of 2.2 percent.

L Brands Inc. reported a same-store-sales decline of 2 percent. But the performance was the end to a banner year for business, according to many analysts covering the parent company for Victoria’s Secret, Bath & Body Works and Henri Bendel.

Perkins wrote that the fiscal year ending in January 2016 was L Brands’ best in terms of sales growth. Victoria’s Secret’s same-store sales declined 4 percent during January. However, L Brands said that total company comps would have increased 1 percent if Victoria’s Secret’s semiannual sale had been held in January, as it has been in the past. Instead the semiannual sale was held in December.

L Brands also reported results for its fourth quarter on Feb. 4. Comps for the fourth quarter increased 6 percent compared with the same quarter in the previous year. The company raised its guidance for its fourth quarter from $1.85 to $1.95 earnings per share to $2.05 earnings per share.

Mall action-sports retailer Zumiez Inc. also received good marks from analysts during January. Its same-store sales declined 4.5 percent. But the retailer beat Wall Street’s predictions. Liz Pierce of Brean Capital had forecast that the retailer would decline 10 percent to 12 percent during January. “Even though we see no let-up in sector challenges, we believe the company is better positioned than it was a year ago due to its omni-channel and product initiatives,” Pierce wrote in a Feb. 4 note on Zumiez.