Retailers report dismal December sales
Several major retailers confirmed predictions for a poor holiday season, with reports of declines in sales in December and announcements that they would cut jobs and close stores, the Associated Press reported.
Even Wal-Mart Stores Inc., which was expected to have a strong season, had only a 1.7 percent same-store sales gain in December. For the five weeks ended Jan. 1, the company’s total sales declined 0.1 percent to $46.51 billion. Wal-Mart cut its earnings from continuing operations guidance for the fourth quarter to 91 to 94 cents per share from $1.03 to $1.07 per share.
Other discount retailers, which tend to fare better in a recession, reported sales declines in December. Target Corp.’s same-store sales dropped 4.1 percent, while Costco Wholesale Corp.’s sales declined 4 percent. But excluding the effects of lower gasoline prices and currency fluctuations, Costco actually had a 4 percent gain. Sears Holdings Corp. said its same-store sales plummeted 7.3 percent, primarily because of a 12.8 percent drop at its U.S. Sears stores.
Macy Inc.’s sales at stores open at least a year dropped 4 percent. The company said it would close 11 stores that were underperforming, which will add a $65 million charge to its fourth-quarter results. Walgreen Co. said it would cut 1,000 jobs this year, or about 9 percent of corporate management.
Limited Brands Inc. reported a 10 percent decline in sales and lowered its fourth-quarter earnings outlook.