'NEW YORK -- An already disappointing holiday shopping season turned out to be even worse than expected for many of the nation's retailers, who said Thursday they had tepid sales gains for December.
The downbeat results came from merchants in all retail categories, particularly from apparel sellers who struggled with depressed sales of cold weather items like heavy coats amid mild weather across the country. Wal-Mart Stores Inc. posted better-than-expected results for December following a dismal November, but the discounter's overall holiday season was the worst on record, analysts said. '
Are customers getting smarter or do they just have less to spend (now that the housing ATM machine is shutting down)?
'Ken Perkins, president of RetailMetrics LLC, a research company in Swampscott, Mass., said retailers were forced to mark down heavily to bring in sales.
"Clearly, this was a promotional Christmas," he said. "Consumers clearly waited until the last minute."
Such aggressive discounting led a number of merchants including Zale Corp., BJ's Wholesale Club Inc., Gap Inc. and AnnTaylor Stores Corp. to cut their profit outlooks. '
Could it be the warm weather? Not enough socks, hats, and boots?
'Mild weather across much of the country meant consumers were in no hurry to buy cold weather wear such as coats and gloves, depressing sales at many apparel stores. Declining gasoline prices and a steady job market should have helped merchants, but Perkins believes the recent drop in home equity loans -- a big source of buying power over the past few years -- curtailed spending among middle-income shoppers.
Sales results were also hurt by two big shifts in the way consumers are shopping: the increasing popularity of gift cards and robust online buying, which is not included in same-store results. Gift card sales are only posted when they are redeemed rather than bought, helping to extend the holiday season into January. '
There were some winners...
'Costco Wholesale Corp. posted a 9 percent gain in same-store sales, beating Wall Street's 5.7 percent estimate.
Nordstrom Inc. reported a robust 9 percent same-store sales gain, exceeding the 4.3 percent forecast. Luxury operator Saks Inc. had an 11 percent same-store sales, gain, nearly twice the 5.3 percent estimate. '
But more losers.
'Pier 1 Imports Inc. suffered a 10.7 percent drop in same-store sales, worse than the 9.4 percent analysts anticipated.
Gap, which has long been struggling with its merchandising formula, suffered an 8 percent drop in same-store sales, worse than the 5 percent estimate. As a result, the company said it was slashing its annual profit outlook.
AnnTaylor posted a 5.3 percent decline in same-store sales; analysts predicted a 0.6 percent gain.
Among teen retailers, Pacific Sunwear of California Inc. had a 3.2 percent dip in December, worse than the 2.9 percent forecast. '
Not being a certified "economist" (who can make predictions that never come true - see David Lireah from the National Ass. of Realtors for example), I am not sure what to make of these numbers. Do they relate in any way to the housing situation? I am inclined to think so.