Feb 6 January was a tough end to a tough holiday
season for U.S. retailers.
Shoppers last month continued to pinch their pennies,
seeking out bargains and paying fewer visits to stores. They
also were unnerved by slumping stock markets and impeded from
shopping by an unusually cold and snowy January that, because of
high heating bills, could hurt retail sales well into the
spring, analysts said.
"Consumers are being hit by a perfect storm of events," said
Craig Johnson, president of advisory firm Customer Growth
Partners. "It's a bloodbath."
Kohl's Corp on Thursday said sales in January were
"significantly" lower than expected as shoppers stayed away. The
department store chain reported a 2 percent decline in quarterly
comparable sales, those online and at stores open at least a
year, despite a good start to the holiday season.
Analysts expect a group of nine retailers that report these
results on a monthly basis to show a 2 percent rise in
comparable sales for January, well below the 4.9 percent growth
of a year earlier, according to Thomson Reuters.
Some chains managed to register sales gains, but those came
either at the expense of rivals or profit margins.
Costco Wholesale Corp said its same-store sales
rose 5 percent in January, with fresh food a popular item for
its bargain-seeking members. That contrasted with a quarterly
decline at Wal-Mart Stores Inc's Sam's Club chain.
Victoria's Secret parent L Brands Inc posted a much
bigger-than-expected jump of 9 percent in comparable sales. But
the company said its profit margin was "significantly" lower
after it had to deepen discounts and hold sales events longer.
The retailer expects only modest sales gains in February.
The consumer mood seemed to sour last month. The Thomson
Reuters/University of Michigan's consumer sentiment index
slipped to 81.2 in January from 82.5 in December. Confidence
fell acutely among households with annual incomes below $75,000.
Also in January, the Dow Jones Industrial Index
tumbled 5.3 percent, and the Standard & Poor's 500 slid
3.6 percent, their worst monthly percentage declines since May
Adding to retailers' woes, the weather was unforgiving, with
record cold and heavy snow last month in the Midwest and
Cato Corp, a chain of low-priced clothing stores;
Fred's Inc, which sells general merchandise; and Stein
Mart Inc, an off-price clothing retailer, all blamed
Mother Nature for declines in comparable sales.
Sterne Agee analyst Charles Grom said higher home heating
bills could crimp consumer spending "well into April."
Clothing chains that cater to teens had another dismal month
in January. The Buckle reported a 6.6 percent drop in
comparable sales, while at Zumiez Inc, they fell 7.6
The disappointing sales results follow recent poor reports
from many stores. Baird analyst Mark Altschwager estimated that
comparable sales at J.C. Penney Co Inc fell 3 percent
last month. And last week, Wal-Mart said its profit for the
fourth quarter ended Jan. 31 would come at or slightly below its
Getting shoppers into stores, a source of major concern for
retailers during the holiday season, did not seem to improve
last month. Walgreen Co managed to report a jump in
comparable sales, but the drugstore chain said traffic fell 2.2