New York – National retail chains offered up a mixed bag of sales results for September, clouding the crystal balls of fourth quarter prognosticators.
The lone CE specialty chain to report last week was Tweeter Home Entertainment Group, which posted a 13.8 percent decline in total revenue to $775 million for its fiscal fourth quarter, ended Sept. 30. While the decline reflects the loss of revenue from 23 closed stores, comparable store sales fell 13 percent for the period following growth of 6 percent for the first two fiscal quarters.
CEO Joe McGuire attributed the downturn to a sharp falloff in Tweeter’s rear-projection TV business, which was down $18 million, or 45 percent, year over year. The category represented 13.5 percent of the company’s sales mix for the quarter, compared to 21 percent last year.
Despite the setback, McGuire said he’s still bullish on the holiday quarter, with sales of flat panel TVs and labor/services expected to grow at a double-digit pace, and the migration to 1,080p product expected to buoy the rear-projection business.
In addition, efforts to streamline operations and cut costs have lowered SG&A expenses and are expected to help slash operating losses from $47 million last year to about $14 million for the just-ended fiscal year. Tweeter is also planning for growth in its audio business for the first time in years, McGuire said.
Among general merchandise chains, Wal-Mart said net sales at its flagship discount stores grew 8 percent to $20 billion in September on the strength of “holiday-related merchandise” like electronics, while comparable store sales came in below projections at 1.3 percent. Tom Schoewe, Wal-Mart’s executive VP and CFO, attributed the flat comps to weak apparel sales and tough comparisons to last year’s hurricane period results. About 1,800 Wal-Mart stores also underwent major department renovations over the summer, including consumer electronics, which may have impacted traffic. The comp figure was also lowered to reflect incorrectly coded sales data at 235 stores.
By contrast, net September sales at Target grew 13.4 percent to $4.9 billion and same store sales increased 6.7 percent, driven by higher tickets, increased traffic and “favorable weather,” said CEO Bob Ulrich.
Among the wholesales clubs, Costco reported an 8 percent boost in net sales to $5.6 billion in September and a 3 percent gain in domestic comps; Wal-Mart’s Sam’s Club division posted a 1.2 percent gain in September net sales, to $3.8 billion, and a 1.1 percent increase in comps; and BJ’s said its net September sales rose 2.1 percent to $751 million while comps slipped 1 percent. Costco saw “continued strength” in A/V, computers and white goods last month, while BJ’s said its strongest performers included TVs and other consumer electronics.
Elsewhere, Sharper Image reported a 12 percent decline in net September sales to $31.9 million and a 21 percent decline in same-store sales.