Retailers, consumers and prices
Check Out Line: A few bright spots amid consumer gloom
McDonald’s posted a higher-than-expected quarterly profit on Tuesday, boosted by strong overseas sales. Coach also reported a higher-than-expected profit, helped by higher sales at stores in North America and Japan.
But the impact of a weak U.S. consumer and a weak U.S. economy was clearly on display as the earnings report began to roll in this week.
Late on Monday, furniture maker and retailer Ethan Allen said its quarterly profit tumbled nearly 50 percent, hurt by restructuring charges and the weak economy.
“Sales in March particularly slowed down due to broader economic concerns raised by the extraordinary intervention of the Federal Reserve to stabilize financial institutions, and to some extent due to Easter falling in March this year,” said Farooq Kathwari, the company’s chief executive.
McDonald’s sales fell slightly in March at U.S. restaurants open at least 13 months, prompting cautious investors to send its shares down 2 percent in premarket electronic trading.
“Due to the continued uncertainty in the economic backdrop, we believe that it’s prudent to wait until our fourth-quarter report to offer guidance for the upcoming fiscal year,” Coach’s Chief Executive Lew Frankfort said in a statement.
But Ethan Allen tried to infuse at least one positive note into its report:
“With a relatively calmer economic environment in April, and Easter behind us, the decline in sales so far has been considerably reduced,” the CEO said.
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