December Same-Store Sales Point to Strong Holidays

 @ibtimes
on January 05 2012 8:35 AM
A woman rests while shopping at South Park mall in Charlotte
A woman rests while shopping at South Park mall in Charlotte, North Carolina November 25, 2011. REUTERS

(REUTERS) -- The first batch of December sales results suggests that people were willing and able to shop if U.S. retailers made it worth the effort with discounts.

Victoria's Secret parent Limited Brands on Thursday reported December sales at stores open a year rose a better-than-expected 7 percent, while teen retailers Zumiez and The Buckle also beat Wall Street forecasts with gains of 10 percent and 8.9 percent respectively.

But Costco Wholesale Corp's 7 percent same-store sales jump just missed the 7.6 percent increase Wall Street was eyeing. Wet Seal's sales decline was steeper than expected, partly because of a 20 percent drop in online sales.

Wall Street analysts are expecting Thomson Reuters' same-store sales index, which tracks 22 retailers, to be up 3.3 percent for December, just above the 3.1 percent gain in December 2010.

Better news on the job market, an upswing in the stock market and December bargains spurred consumer spending in a hopeful sign for 2012, analysts said.

Shoppers are showing more enthusiasm, said Richard Hastings, a consumer strategist with Global Hunter Securities. But the key will be for stores to continue offering deals to keep them coming, he added.

Shoppers, especially those on tight budgets, could balk if they do not find bargains to their liking in the new year.

The deals were good, I guess that's why I spent more, said Joanne Marcelle, 52, at an Old Navy store in New York's Herald Square on Wednesday.

But the unemployed Bronx grandmother said she still depends on bargains. I can't say what the year will hold for us.

Other major chains including Macy's Inc , Target Corp , J.C. Penney Co Inc and drugstore chains Walgreen Co and Rite Aid Corp will report December sales later on Thursday.

Store traffic rose in December, particularly in the days leading up to, and following, Christmas.

Retailers pulled out all the stops to lure shoppers this season. Macy's expanded its late-night hours to more stores in the final days before Christmas and Wal-Mart Stores Inc brought back a lay-away program that challenged Target.

The National Retail Federation is expecting retail sales to be up 3.8 percent for the November-to-December period.

(Reporting By Phil Wahba, editing by Maureen Bavdek)

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