US Retailers Report Modest July Sales Gains

(RTTNews) - US apparel retailers reported modest July sales on Thursday, with most of them, including L Brands, Buckle, Stein Mart and Zumiez, reporting sales increases at established stores. However, sales were down at Cato.

July sales were positively impacted by the start of the back-to-school season shopping, while it was hurt by the challenging retail environment that saw mall traffic and the pace of consumer spending slowing.

Back-to-school season shopping period is the second biggest selling period behind the winter holidays.

July sales are typically weak and a transitional month for retailers as shoppers take vacations or save for school shopping. However, retailers offered aggressive sales in order to clear shelves of summer items ahead of the back-to-school rush. Hot weather in the beginning of the month also saw shoppers pick up summer clearance clothes.

A report released from the Conference Board last week showed that U.S. consumer confidence for the month of July fell by more than economists had anticipated with consumer expectations regarding the short-term outlook weakening.

The U.S. consumer confidence index dropped to 80.3 in July from a revised 82.1 in June. Economists had been expecting the index to dip to 81.0 from the 81.4 originally reported for the previous month.

Comparable-store sales or comps is a key retail industry performance metric to gauge activity at store locations that have been open for at least a year. Market-research company Retail Metrics reported that retailer's comparable store sales are expected to increase 4.1 percent in July, much higher than the 2.5 percent rise in July last year.

L Brands, Inc. (LTD), the operator of Victoria's Secret and Bath & Body Works chains, said its July comparable store sales rose 3 percent, reflecting positive sales across its three brands.. The result topped Street expectations for a 1.5 percent increase. Net sales were $678.4 million, up from $649.8 million last year.

Teen apparel retailer, Buckle, Inc. (BKE) announced that comparable store net sales for the month of July increased 2.1 percent, missing analysts' expectations for 2.6 percent increase. Net sales also grew 16.7 percent to $77.2 million from last year.

Meanwhile, value-priced fashion apparel retailer Cato Corp. (CATO) reported that July same-store sales were down 5 percent, and total sales decreased 3 percent from last year to $61.6 million.

"July same-store sales reflect the continuing economic uncertainty and the related volatility we have seen throughout much of the year," commented John Cato, Chairman, President, and CEO of Cato.

Stein Mart, Inc. (SMRT) reported 3.7 percent growth in comparable store sales for the month of July. Total monthly sales also grew 5.8 percent to $74.6 million from the prior-year month.

"I am pleased with our sales performance in July which wrapped up a great second quarter where our comparable store sales increased 6.4 percent," CEO Jay Stein said.

Specialty retailer of action sports related apparel, footwear, equipment and accessories Zumiez, Inc. (ZUMZ) reported Wednesday that its comparable store sales for July increased 0.8 percent, missing analysts' expectations for a 1.7 percent increase. Total net sales also grew 19.3 percent from last year to $56.1 million.

Another specialty retailer to young women Wet Seal, Inc. (WTSL) stated that second-quarter comparable store sales increased 3.7 percent, with a 3.9 percent growth at Wet Seal, and a 2.0 percent rise at Arden B.

Off-price retailer TJX Cos., Inc. (TJX) and discount retailer Ross Stores Inc. (ROST) have also joined the growing list of companies that have stopped reporting monthly sales results. Wet Seal is also now reporting only quarterly comparable store sales results.