Retailers, consumers and prices
Check out the sluggish sales at Walgreen.
People filled more prescriptions at the drugstore chain, but didn’t buy much else. August same-store sales rose only 1.9 percent, less than analysts had anticipated.
While many retailers have been experiencing sales declines, drugstores have generally done much better because an aging population has been buying more prescriptions drugs.
But Walgreen’s sales of general merchandise fell 1.3 percent.
That could be a bad sign for other retailers that report sales this week. Walgreen is the third-largest retailer that reports monthly sales, behind only Costco and Target.
Overall, analysts are expecting a 3.8 percent drop in same-store sales when retailers report this week.
Also in the basket:
Zale identifies prior adjustments, delays results
Jos A Bank Q2 results top Street
Brown-Forman profit tops view
Tesco uses weather to predict sales (N.Y. Times)
Retail theft soars in economic downturn (WWD, subscription required)
Check out the cost cutting formula failing at Sears.
In the past few weeks a slew of retailers, ranging from Target to Macy’s to Dillard’s, have posted results that were better than Wall Street expected, helped by cost cuts. Retailers have done everything from freezing executive salaries to eliminating jobs to slowing store expansion plans.
But on Thursday, Sears reported a surprise loss in its second quarter while analysts were expecting a profit.
U.S. retailers reported disappointing sales declines for July, suggesting shoppers are still searching for bargains and basics in the downturn.
July’s results mark the 11th consecutive month of falling sales at stores open for at least one year, a measure known as same-store sales.
Check out the expected drop in July same-store sales for U.S. retailers.
July typically offers retailers a chance to bolster second-quarter profits by selling new autumn merchandise, but they likely got little boost this year from back-to-school sales as cool weather, a weak job market and a lack of tax-free holidays has analysts expecting an 11th consecutive drop in monthly same-store sales.
Consumers have shown a penchant for skipping full-price items to stretch their budgets amid the recession.
Check out the generally dismal sales in June, sprinkled with drops of hope.
Sales dropped at several U.S. chains as consumers stayed out of the rain and out of the stores. Still, some of those focused on discounts once again reaped the rewards as those who did go out searched for deals.
Check out the expected June sales declines at U.S. retailers.
Cooler and wetter weather made things tough for companies, especially those selling summer products in the first three weeks. Overall same-store sales for the month are expected to be down 4.8 percent, according to Thomson Reuters.
“The consumer is still up against too many hurdles to be spending too much money,” Storehouse Partners retail analyst Patricia Edwards said.
Check out the expected weak May sales in the U.S. retail landscape.
Despite Memorial Day sales, warmer weather and deals such as $1 flip-flops, most U.S. retailers are expected to report declines in same-store sales in May as shoppers kept hunting for bargains in the recession.
Only eight of 30 retailers are expected to post growth in May sales at stores open at least a year when companies report results this week. Walgreen kicked things off with a 1 percent increase, but that was below what analysts had expected due to weaker-than-expected sales at its pharmacy counters.
Check out some strong sales.
Sure, sales are still down at most chains. Still, anything that’s down less than expected is a good sign in this economy, right?
Sales at Wal-Mart‘s U.S. stores open at least a year jumped 5 percent, topping analysts’ average expectation for a 2.9 percent rise. And in a sign that improving sales are leading to better profitability, retailers including J.C. Penney, TJX and Kohl’s raised their profit expectations for their just-completed first quarter.
The results coming in show that things might not be so bleak after all. Sure, some retailers still disappointed with March same-store sales down more than expected. Take a look at American Eagle, whose same-store sales fell 16 percent, while analysts expected a 10.4 percent drop. Still, the company raised the low end of its profit forecast since it marked down less merchandise.
Over on the discount side, Wal-Mart’s same-store sales were only up 1.4 percent, while the Street expected them to rise 3.2 percent. Still, they were up. And they should be up again in April. The CEO of smaller discounter Target, meanwhile, had this to say: