U.S. Retail October Sales Up in Month Mostly Free of Sandy Hit

   By Joan E. Solsman and Karen Talley 
 

U.S. retail sales rose in October, as retailers closed their books on the month before the brunt of Hurricane Sandy hit the Northeast.

Costco Wholesale Corp. (COST) posted a 5% rise in U.S. same-store sales minus gasoline, compared with the 5.6% increase that was expected. The warehouse chain saw customer traffic increase by 4% on a comparable-store basis.

By category, softlines increased by a high single-digit percentage, with strength in small appliances and men's and women's apparel.

Sales of food increased in a low to mid-single digit percentage, with items in cooler, frozen foods and deli the strongest performers. Sales of durable items increased by a mid-single digit percentage, with hardware, consumer electronics, automotive and health and beauty all advancing. Sales in the fresh-food category were also higher.

On a regional basis, San Diego, the Northeast and the Midwest posted the strongest results, Costco said.

The company said a dozen of its warehouses were closed because of Sandy, which is expected to be a negative impact in November sales results. It couldn't quantify the hit but believed it would be small.

Limited Brands Inc. (LTD) slowed its momentum, showing same-store sales rose 3%, when 5% was expected. The retailer's comparable sales growth slowed to 3% at its Victoria's Secret chain, despite consensus for a 6.1% gain, though Bath & Body Works reported strong results with a 5% increase when 4.9% was expected.

The 17 retailers tracked by Thomson Reuters are expected to report 4.3% growth in October same-store sales, or sales at stores open more than a year. This compares with an increase of 4.1% a year ago. The retailers ended their fiscal October on Saturday, before Sandy had reached the Northeast.

Retailers posted a 0.8% rise in September, when two months of back-to-back strength on back-to-school buying fell away. This included results from drugstores.

Department-store chain Stage Stores Inc. (SSI) again beat expectations with a 6.5% rise in same-store sales when just a 2.8% gain was expected. Sales in the categories of home and gifts, junior and misses sportswear were again strong, outperforming the company average; cosmetics and men's sportswear also outperformed. Geographically, all regions of the country had positive comparable sales, with the Midwest, Northeast, South Central and Southwest regions outperforming.

Teen retailer Zumiez Inc. (ZUMZ) reported a 0.6% increase, though 4.5% was expected. The company lowered its fiscal third-quarter earnings guidance, saying total sales for the full period were weaker than anticipated, primarily because of challenged selling in Europe. Fellow teen-retailer Wet Seal Inc. (WTSLA) posted a 13.5% slump in comparable-store sales when a 10.5% decline was projected.

September same-store sales at teen-apparel retailer Buckle Inc. (BKE) 3.8% compared to the year-ago period, while an decrease of 1.3% was expected.

Write to Joan E. Solsman at [e-mail].