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Retailers post surprisingly solid monthly sales

Some say figures bode well for the holiday season

A hot August and late Labor Day pushed many back-to-school sales into September. But analysts don’t expect big gains for retailers until unemployment eases and consumer confidence rises. A hot August and late Labor Day pushed many back-to-school sales into September. But analysts don’t expect big gains for retailers until unemployment eases and consumer confidence rises. (Damian Dovarganes/Associated Press)
By Mae Anderson
Associated Press / October 8, 2010

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NEW YORK — Retailers reported surprisingly solid sales gains for September, boosted by back-to-school shopping, much of it pushed into September by parents who had put off trips to the mall.

An array of companies, including Macy’s Inc., Saks Inc., Victoria’s Secret, Abercrombie & Fitch, and Limited Brands Inc. (owner of Bath and Body Works) yesterday reported better-than-expected results.

The results give hope for a positive holiday shopping season, although Americans are still dealing with an uncertain economy and high unemployment.

The International Council of Shopping Centers’ index of September retail sales rose 2.6 percent, near the low end of its forecast, which called for 2.5 to 3 percent growth.

“There was really good performance from a handful of stores, a number of pretty good performers, and some are still struggling,’’ said Mike Niemira, the organization’s chief economist.

He added that while 2.6 percent is not that strong of a number on its own, the tone of retailers’ reports seemed better than in previous months, even though September is the first month in which retailers are comparing against positive results from 2009, making comparisons more difficult.

An improving stock market also might have spurred some shoppers to spend, said Ken Perkins, president of the research firm RetailMetrics. The S&P 500 index rose 9 percent during the month.

“It’s turning out to be a solid month, which should bode well for the holiday shopping season,’’ he said.

“It’s clear that back-to-school came later this year once again, with parents toting their children back to the malls and outlets in the first weeks of September after browsing in August,’’ said an analyst at Wall Street Strategies, Brian Sozzi.

Several retailers, including the Gap, Wet Seal, and Target, reported that revenue dropped off in the second half of the month, particularly in the last week.

Weather was a factor — there was a heat wave on the West Coast and tropical storms in the East — but he said that might also indicate “the consumer has prepared . . . to pause prior to the holidays, preferring to bolster savings in the lead-up to the holidays.’’

High-end retailers reported strong results, tool. Saks’s revenue in stores open at least one year rose 6.5 percent, nearly double the 3.8 percent gain analysts had predicted.

Nordstrom’s revenue figure rose 7.5 percent, better than the 4.3 percent analysts expected.

September revenue comparisons

Here’s a comparison of September revenue, this year and last, at selected chains in stores that have been open at least a year. The comparison is a key indicator of a retailer’s health because it excludes the effects of expansion and stores closing during the year.

BJ’s Wholesale Club 1.5%
Target Corp. 1.3%
J.C. Penney Co. 5.1%
Kohl’s Corp. 3%
Neiman Marcus Group 3.3%
Macy’s Inc. 4.8%
Abercrombie & Fitch Co. 13%
American Eagle Outfitters 4%
Gap Inc. -2%
TJX Cos. 1%

Sources: The companies