U.S. retailers including Gap Inc. and L Brands Inc. posted September same-store sales that missed analysts’ estimates as a lack of new products and a choppy economy encouraged shoppers to restrain spending.
Same-store sales for the more than 10 retailers tracked by Retail Metrics Inc. rose 2.3% last month, excluding results from drugstores, the Swampscott, Massachusetts-based researcher said in an e-mailed statement yesterday. Analysts’ had estimated a 3.4% gain, the researcher said.
The lower-than-projected sales signal consumers are still holding back spending amid higher taxes, uncertainty about the implementation of the Affordable Care Act and the first government shutdown in 17 years, which took effect on Oct. 1. Last month also was warmer than usual, damping sales of fall merchandise and leading retailers to deepen discounts to lure shoppers.
“The lack of product newness drives weak mall traffic, which drives ongoing promotions,” Simeon Siegel, a New York- based analyst at Nomura Securities, said in a phone interview yesterday. “Couple that with unseasonable weather when you want to be selling seasonable products and that leaves you with less- than-exciting results.”
Gap, the largest U.S. specialty-apparel retailer, said yesterday in a statement that same-store sales fell 3%, while the average of analysts’ estimates compiled by Retail Metrics was for a 1.8% gain. Shares of the San Francisco- based company fell 6.2% to $37.02 at 9:47 a.m. New York time after reaching $36.45.
L Brands, which owns the Victoria’s Secret and Bath & Body Works brands, said in a statement that comparable-store sales rose 1%, missing the estimate for a 2.1% increase. The Columbus, Ohio-based company released its results before the market opened yesterday. Its stock fell 2.7% to $55.10 at 9:47 a.m.
September was warmer and wetter than last year, according to data compiled by Siegel, which may have kept shoppers out of stores pushing sweaters and jeans. To clear fall merchandise for colder-weather and holiday items, retailers deepened discounts, many offering items for 25% to 40% off the original price, according to Retail Metrics.
Warehouse club Costco Wholesale Corp., which boosted August sales results as shoppers sought durable goods, trailed estimates this month, posting a 3% sales increase, compared with a forecast for 3.4% growth.
Most chains tally same-store sales using locations open at least a year, making the figure a closely watched gauge of a retailer’s health because it tracks only established stores.
The partial shutdown has closed government services and furloughed federal workers. The government also faces default unless an agreement is reached between President Barack Obama and House Republicans by Oct. 17 to raise the nation’s debt ceiling.