The Financial & Risk business of Thomson Reuters is now Refinitiv

All names and marks owned by Thomson Reuters, including "Thomson", "Reuters" and the Kinesis logo are used under license from Thomson Reuters and its affiliated companies.

October 7, 2015

September Retail Sales Continue To Show Weakness

by Jharonne Martis.

September’s retail sales outlook isn’t much better than August’s. The Thomson Reuters Same Store Sales Index is forecast to gain just 0.2% – compared to 3.8% a year ago. Excluding drug stores, the SSS growth rate falls to -0.1%; this is also considerably weaker than the 3.5% ex-drug result recorded in September 2014.

Costco has the biggest weighting in our index, and is expected to post a -0.4% SSS. The weakness comes from foreign exchange rates, and the impact of gasoline sales. Excluding Costco, the SSS Index improves to a 0.9% growth rate.

Still, mall traffic picked up in September vs. August. Cool weather also helped boost demand for fall merchandise. However, mall traffic still remains weak compared to year-ago levels. Additionally, retailers are facing difficult comparisons. As a result, September SSS results are almost flat compared to a year-ago. Teen retailer Zumiez is expected to post the weakest SSS results at -6.8%. Another mall store that is suffering from weak sales is Gap with a -1.3% SSS estimate. Meanwhile, L Brands and Rite Aid are on top with a 4.2%, and 1.4% SSS estimates.

Looking at the quarter, our Thomson Reuters Quarterly Same Store Sales Index, which consists of 83 retailers, is projected to post a 1.6% growth for Q3, slightly below last year’s 1.7% SSS growth.

Source: I/B/E/S estimates. Note: Aggregate mean data is revenue weighted.

Sector by sector

The Discount sector is facing one of the most difficult comparisons from a year-ago. The group has a -0.4% SSS estimate, below the 3.9% pace set in September 2014. Costco has a
-0.4% comp estimate in the group, below its 4.0% September 2014 result. The discounter is negatively affected by foreign exchange rates among other factors. Excluding the impact of gasoline sales, the Costco SSS figure rises significantly to 6.6%. Meanwhile, Fred’s has a 1.2% SSS estimate vs. a 0.2% posted in September 2014.

Analysts expect the Apparel sector as a whole to report a 0.5% SSS, compared to the 2.6% gain in SSS recorded in September 2014. Excluding Gap, one of the heaviest-weighted components in the sector, the Apparel group is set to improve at 2.6%, below the 5.7% result posted in September 2014. Only L Brands has a positive estimate in this group at 4.2%. Meanwhile, Stein Mart and Cato Corp are both expected to post the weakest result in the group at -2.0% SSS, followed by Gap at -1.3% SSS vs. flat sales comparison from 2014. Its Gap Global division is expected to post the weakest SSS at -6.0% for September 2014. On the flip side, its Old Navy Global division has a 5.6% SSS estimate. Usually, Old Navy Global is Gap’s strongest during the back-to-school season.

Apparel stores catering specifically to teens have the weakest estimates within the retail universe. Same store sales are expected to post a -3.0% comp for the sector. The Buckle is facing an easy 2.2% comparison from a year-ago and is expected to post -0.6% SSS, while Zumiez is expected to post a -6.8% SSS.

Receive stories like this to your inbox as they are published. Subscribe here and follow us @Alpha_Now on Twitter. If you are looking to access our data or analytics, register for a free trial.

Get In Touch


We have updated our Privacy Statement. Before you continue, please read our new Privacy Statement and familiarize yourself with the terms.×