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Ultimate, Sears Oct. Sales Down; Discounters O.K.

11/07/2003 01:09:00 PM Eastern

New York - October was truly a month of treats and tricks for retailers, as discount chains continued their sales rally while Sears fell back into negative territory.

Meanwhile, fiscal third quarter sales for 64-store, specialty A/V chain Ultimate Electronics fell 10 percent to $160 million and same-store sales slid 12 percent for the period ended Oct. 31.

CEO Ed McEntire said revenue was impacted by disappointing store traffic, a problematic changeover to a new management information system and Ultimate’s exit from the computer category. The company has increased its advertising spending to spark store traffic, reinforce the brand and goose holiday sales, McEntire said.

Among full-line stores, Sears said total sales slipped 2.2 percent to $1.9 billion for the four weeks ended Nov. 1 while comparable store sales declined 2.7 percent. Despite the downturn, attributed by CEO Alan Lacy to 'unseasonably warm weather,' the mass merchant managed to 'sustain our sales momentum in home appliances in October,' with a low single-digit gain in majap sales, while Sears’ CE business declined by the high single digits.

Among the discount chains, Wal-Mart’s flagship stores saw net sales rise 10.7 percent to $12.7 billion for the four weeks ended Oct. 31 while comps grew 4 percent. The company included CE and office supplies among its 'above average' categories for the month. Similarly, Target’s total sales for the four weeks ended Nov. 1 rose 10.7 percent to $2.9 billion while comps gained 4.5 percent.

Within the warehouse club channel, Costco’s net sales grew 14 percent to $3.4 billion for the four weeks ended Nov. 2 and U.S. comp sales rose 8 percent. Wal-Mart’s Sam’s Club unit enjoyed a 9.7 percent spike in net sales to $2.6 billion and a 7 percent spurt in comps, and No. 3 player BJ’s said October revenue totaled $506.1 million, a gain of 15.9 percent over the year-ago period, while comps grew 10.2 percent. CEO Mike Wedge said strong sales of computer equipment and TVs contributed to the gains.

Also reporting brisk October sales was specialty retailer Sharper Image, which enjoyed a 35 percent hike in total multi-channel revenue to $50.5 million while comp store sales grew 12 percent.