| NEW YORK
NEW YORK Jan 9 Many U.S. retailers had to ramp
up promotions last month as shoppers continued to watch their
spending during the holiday season, hitting profits at several
L Brands cut its earnings forecast for the holiday
quarter on Thursday after reporting disappointing December sales
at its Victoria Secret and La Senza chains. The company said it
had to offer more deals than expected, the second month in a row
it has had to do so.
Family Dollar Stores Inc and teen retailer Zumiez
Inc, which both reported sales declines for December,
also slashed their profit forecasts. Even retailers that saw big
sales gains, like Kay Jewelers parent Signet Jewelers Ltd
, were not spared.
"Additional discounting was necessary in a highly
promotional retail environment," Signet Chief Executive Officer
Mike Barnes said in a statement.
A group of nine U.S. retailers in the Thomson Reuters
same-store sales index are expected on Thursday to report a
sales rise of 1.9 percent in December at stores open at least a
year, well below the 7.2 percent increase of a year earlier.
Including drugstore chains Walgreen Co and Rite Aid
Corp, analysts estimate the rise at 2.7 percent.
Gap Inc will report after the markets close on
Faced with reticent shoppers worried about their job
prospects and modest economic growth, retailers offered more
discounts during the holiday season than a year earlier.
Between Nov. 3 and Jan. 4, eight retailers, including
Wal-Mart Stores Inc, Target Corp and Macy's Inc
, increased the number of circulars published by 6 percent
and sent 57 percent more promotional e-mails, according to data
prepared for Reuters by MarketTrack.
Retailers also had to deal with shoppers who were less
willing to go into stores: Data firm ShopperTrak this week said
foot traffic had dropped 14.6 percent this holiday season.
Walgreen, whose comparable sales of general merchandise rose
2.5 percent in December, said fewer shoppers had come to its
stores. Signet's Barnes said more enticing deals were needed to
L Brands' sales at stores open at least year rose 2 percent
last month, less than the 3.7 percent Wall Street expected,
according to Thomson Reuters I/B/E/S. Zumiez reported an
unexpected drop in same-store sales.
Small clothing chain Cato Corp also slashed its
profit forecast after reporting poor December sales.
Still, some chains offering staples at low prices fared
well: Costco Wholesale Corp, which draws shoppers with
low prices for its members, reported a 5 percent same-store U.S.
sales gain for December, while Wall Street was expecting only 1
American Eagle Outfitters Inc said comparable sales
for November and December fell 7 percent and that it expected
its quarterly profit to come in at the bottom of its earlier
forecast range of 26 cents to 30 cents per share.
Signet's U.S. comparable sales rose 5 percent for the
combined November-December period. Family Dollar's same-store
sales fell 3 percent last month.
American Eagle, Signet and Family Dollar are not part of the
same-store sales index.
(Reporting by Phil Wahba in New York; Editing by Lisa Von Ahn)