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.

February 8, 2016

January Retail Sales Cold As Snow, Missing Forecasts

by Jharonne Martis.

The retail industry wound up its fourth fiscal quarter in the month of January with dismal results. The Thomson Reuters Same Store Sales (SSS) Index reflected a -1.1% drop. Excluding drug stores, the index registered a -1.0% comp for January. Both numbers missed their final estimate of 0.0% growth. Three-fourths of the retailers missed their SSS estimate. The 2016 numbers also don’t compare well with the SSS gains in January 2015 of 1.5% overall and 0.6% ex-drug.

Results are not final as Gap will report January SSS on Feb. 8. The January 23-24 blizzard in the Northeast kept shoppers at home. As a result, holiday clearance has not been selling well. As inventory piles up, retailers missed their SSS estimates and blamed the weather and a weak consumer spending environment.

The usual winner, L Brands, posted its first negative SSS, after eight consecutive months of robust comps. The retailer was hurt by the shift of the Victoria’s Secret semiannual sale into December. As a result, the division was its weakest performing group at -4.0%, followed by Bath & Body Works at 2.0%. The Buckle registered the weakest result in our retail universe at -11.3%, followed by Cato Corp’s -7.0% SSS result which came in below its -2.0% final estimate. Costco has the biggest weighting in our index, and posted a flat SSS, and is being hurt by gasoline sales. Excluding gas, Costco posted a robust 4.0% SSS. Meanwhile, Fred’s registered the strongest result at 0.7%, above expectations of 0.5%.

Since January is the last month of Q4 2015, retailers will be reporting Q4 results in the upcoming weeks. The Thomson Reuters Quarterly Same Store Sales Index, which consists of 83 retailers, is expected to post 1.1% growth for Q4 (vs. 2.8% gain in Q4 2014).

Exhibit 1.  Performance — Overall and Compared to Expectations

1

Exhibit 2.  Beat — Met — Missed

2

Source: I/B/E/S estimates.

Article Keywords ,

Get In Touch

Subscribe