Mixed Bag for Retailers in December
For retail powerhouse L Brands—the Columbus, Ohio–based parent company of Victoria Secret—December was flat. But it was grim news for Kearney, Neb.–based The Buckle, which reported a 15.1 percent drop in net sales to 154.6 million in December as well as a 15.5 percent drop in same-store sales.
The Gap Inc. saw net sales and comp sales increase in December. The San Francisco retail giant reported a 1 percent increase in same-store sales at its Gap division, a 7 percent drop at Banana Republic and a 12 percent increase at Old Navy.
“We’re pleased with the improved momentum we saw over the holiday season, driven primarily by a positive customer response at Gap and Old Navy,” said Sabrina Simmons, chief financial officer of Gap Inc. “Based on these results, we now expect full-year adjusted earnings per share to be modestly above the high end of our previous adjusted guidance range of $1.92.”
The holiday was a sunny one for Lynnwood, Wash.–based action-sports retailer Zumiez as well. The company reported a 6.8 percent increase in net sales to $146.6 million and a 3.5 percent increase in its comp-store sales.
Retailers in the eastern part of the United States got an assist from mother nature when cold weather drove consumers to the mall in search of warm clothing. According to Planalytics, which analyses the effect of weather on business, apparel stores realized $309 million in sales in December thanks to the chilly weather.
But the big news of the holiday was Macy’s, which announced plans to slash more than 10,000 jobs following a disappointing November/December holiday season. The Cincinnati-based retail giant reported a 2.1 percent drop in comparable sales in November and December. Terry J. Lundgren, Macy’s Inc. chairman and chief executive officer, said the results were consistent with the “lower end of our guidance” and reflected “the broader challenges facing much of the retail industry.”
The layoff announcement also included added details about the planned closure of 100 stores.