Friday, June 07, 2002
Seasonal retail sales freeze
By The Associated Press
and Cincinnati Enquirer
NEW YORK Unusually cool weather stifled demand for shorts, T-shirts and other seasonal merchandise during May, leaving many of the nation's biggest retailers with disappointing sales.
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WAL-MART GAINS
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May same-store sales reported by the five largest retailers (sales compare the current year's sales with those of the previous year at stores open at least a year):
Wal-Mart Stores, up 6.2 percent.
Target, up 2.6 percent.
Kmart, filed for Chapter 11 bankruptcy protection in January and reports its same-store sales when it reports operating data at the end of each month.
J.C. Penney, down 5.1 percent (J.C. Penney stores only).
Sears, Roebuck and Co., down 4.4 percent (domestic stores only).
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Stores including Kohl's Corp. and TJX Cos. Inc., which have thrived despite the difficult environment, turned in solid results again Thursday as stores released monthly sales figures. Wal-Mart Stores Inc., which reported its sales Wednesday, also had better-than-expected business in May.
But many department stores and mall-based apparel chains, including May Department Stores Inc. and Federated Department Stores Inc., had lackluster sales.
Gap Inc. again posted a decline in sales at stores open at least a year, known as same-store sales, although the drop wasn't nearly as steep as Wall Street anticipated.
Same-store sales at Federated fell 3.4 percent in May. On a year-to-date basis, same-store sales are down 3.1 percent.
The end of the month was a disappointment, and the exceptionally cool weather that much of the country has been experiencing probably is a large part of the reason for this negative performance, James Zimmerman, Federated's chairman and chief executive, said.
Elder-Beerman Stores Corp., the smaller department store chain based in Dayton, Ohio, fared better. Its same-store sales fell 1.3 percent in May. For the first five months of 2002, its same-store sales are down 2.4 percent.
Although sales overall fell short of expectations, merchants had some good news: Many stores that went into the season with lean inventories were not forced to heavily discount merchandise to generate business. That helped protect their profit margins.
But many retailers continue to struggle.
It was pretty uneven, said Michael P. Niemira, vice president of Bank of Tokyo-Mitsubishi Ltd.
Weather was a negative, and it hurt more than it helped. It accentuated the pause in consumer spending that we have seen since March.
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