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By Ashley Lutz
NEW YORK - Retailers reported mixed December same-store sales results, with companies that offered the right discounts topping analysts’ estimates, while others missed out on a projected record holiday shopping season.
Macy’s Inc. reported a 6.2 percent increase in same-store sales, topping the 4.6 percent estimate from analysts surveyed by researcher Retail Metrics Inc. Sales at Gap Inc. declined 4 percent, wider than the average estimate for a 1.3 percent drop.
Some retailers offered steep discounts last month, motivating shoppers to buy gifts and treat themselves. The companies that spread their discounts out over the season did well, while those that used up their promotions during the weekend after Thanksgiving suffered, said Alison Paul, retail sector leader at Deloitte in Chicago.
“The retailers who are still standing are the ones who did their homework several months ago and made decisions about promoting in waves,” Paul said Thursday in an interview. “Getting promotions right is an art form.”
Same-store sales for the more than 20 companies tracked by Retail Metrics may have gained 3.3 percent in December, the Swampscott, Mass.-based researcher said Wednesday. Most chains count locations open at least a year to tabulate same- store sales, a key indicator of a retailer’s growth because new and closed sites are excluded.
Macy’s boosted its fourth-quarter earnings forecast to as much as $1.60 a share, after earlier projecting a maximum of $1.57 a share. Analysts projected $1.61, the average of 14 estimates compiled by Bloomberg.
Cincinnati-based Macy’s rose 0.1 percent to $32.69 at 9:05 a.m. in New York. The shares climbed 27 percent last year.
The National Retail Federation last month raised its forecast for the holiday shopping season after steeper discounts and earlier opening hours contributed to a record $52.4 billion in sales during the Thanksgiving weekend.
Retail sales may increase 3.8 percent to a record $469.1 billion in November and December, up from a previous projection for a 2.8 percent gain, the group said. The increase would be higher than the 10-year average of 2.6 percent growth and slower and than last year’s 5.2 percent increase, according to the Washington-based NRF.
The New York-based International Council of Shopping Centers Wednesday raised its forecast for December sales growth to as much as 4.5 percent from an earlier prediction of as much as 4 percent.
‘Hit on Profit’
The increased traffic may not help retailers’ fourth- quarter profit much since they used so many discounts to draw customers, said Marshal Cohen, lead industry analyst at Port Washington, New York-based NPD Group.
“A good sales month in December doesn’t mean a good profit month,” Cohen said. “Many retailers got caught up in offering deals and didn’t plan for later. They’re going to take a hit on profit.”
Consumer spending, which accounts for about 70 percent of the economy, grew at a 2.3 percent annual rate in the third quarter, the fastest pace of 2011, the Commerce Department said in November.
Unemployment at its lowest in more than two years and falling gasoline prices boosted consumer confidence to an eight-month high in December.