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August Sales Strong For Discount Chains

9/04/2008 11:16:00 AM Eastern

New York — Most of the nation’s top discount chains enjoyed solid sales in August, although CE generally took a back seat to food and back-to-school items.

Net sales at Wal-Mart’s flagship discount stores rose 7 percent to $19.4 billion last month while comp-store sales edged up 2.8 percent. The chain attributed the gains in part to strong CE sales — particularly flat-panel TVs, digital audio, cellphones and services, and GPS units — and a brisk back-to-school business.

“The underlying business performance for Walmart U.S. continued to show strength and the improved relative performance has resulted in market share gains,” said president/CEO Eduardo Castro-Wright.

As of yesterday, fewer than 50 Walmart stores in the Gulf Coast area remained closed as a result of power outages and other issues related to Hurricane Gustav.

Wal-Mart announced earlier this summer it would be updating its logo, hence the different spelling of the corporate name (Wal-Mart) and its retail stores (Walmart).

At Target, net sales increased 3.1 percent in August to $4.9 billon and comp-store sales slid 2.1 percent, in line with the company’s planned range, said president/CEO Gregg Steinhafel. Entertainment was among the chain’s weaker performers, with new DVD releases and Blu-Ray Disc titles offsetting declines across the category.

Among the wholesale clubs, Costco said August net sales rose 12 percent to $5.4 billion and U.S. comp-store sales increased 6 percent excluding gasoline, no thanks to brown and white goods. The company reported overall mid-single-digit comp-sale declines in those categories, with TV, audio and computers showing “somewhat softer sales” compared to last year, said finance/investor relations VP Bob Nelson. Costco did enjoy “some increases” in cameras, room air, cellphones and navigation equipment, he said.

At Wal-Mart’s Sam’s Club division, net sales rose 8.7 percent to $3.6 billion last month, and comp sales increased 4.2 percent excluding gasoline. Thirteen Gulf Coast stores were closed for at least one day as a result of Hurricane Gustav but all have since reopened, the company said.

BJ’s Wholesale Club reported a 17 percent spike in net sales to $774.4 million last month and a 7.7 percent gain in comp sales excluding gasoline. Computers were among the best-performing categories on a year-over-year basis, while room air, TVs and prerecorded video were among the weakest.

Separately, Conn’s reported earlier this week that Hurricane Gustav had little impact on August revenue, with total product and extended-warranty sales up by the low-double-digits and same-store sales “slightly positive” for the month.

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