Apparel Retailers Mostly Report Lower Sales In August

(RTTNews) - A sampling of U.S. apparel retailers on Thursday mostly reported lower sales at established stores for the pivotal back-to-school shopping month of August.

August is normally a healthy month for U.S. retailers as parents and students line up at stores for back-to-school and even back-to-college shopping, which are a necessity. It is the second-biggest selling period for retailers after the Christmas holiday season.

However, according to the National Retail Federation's annual survey earlier in August, back to school shopping was only at the halfway mark despite having started earlier this year.

"It is evident that many families are still considering price and value when shopping for their back-to-school and college needs," NRF President and CEO Matthew Shay said.

The NRF's annual back-to-school survey showed that parents of K-12 and college students plan to spend a record $75.8 billion this summer, representing an increase of 11.5 percent over 2015.

In August, data showed that U.S. consumer confidence jumped to its highest level in almost a year. The Conference Board said its consumer confidence index jumped to 101.1 in August from a downwardly revised 96.7 in July. Economists had expected the index to come in unchanged compared to the 97.3 originally reported for the previous month.

Sales at established stores or comparable-store sales is a key retail industry performance metric to gauge activity at store locations that have been open for at least a year.

L Brands, Inc. (LB), the operator of Victoria's Secret and Bath & Body Works chains, said its August comparable store sales increased 2 percent, reflecting strength in its Bath & Body Works brand. This compared to an increase of 6 percent in the year-ago period.

Net sales for the month were $852.9 million, up 3 percent from $826 million last year.

However, the company noted that the August merchandise margin rate was down significantly to last year.

Looking ahead, L Brands said it expects same-store sales for the month of September to be about flat.

Teen apparel retailer Buckle, Inc. (BKE) said that its comparable store net sales for the month of August decreased 14.8 percent. Net sales for the month declined 14 percent to $87.2 million from last year's $101.4 million.

Within the men's and women's categories combined, Buckle's accessory sales for the month were down about 11.5 percent compared to the same period last year, while footwear sales declined about 14.5 percent. These two categories accounted for approximately 9 percent and 5 percent, respectively, of the latest month's net sales.

Value-priced fashion apparel retailer Cato Corp. (CATO) reported that its August same-store sales declined 8 percent, while total sales decreased 7 percent from last year to $62 million.

"August same-store sales continued our negative trend and remain well below our expectations," said John Cato, chairman, president, and chief executive officer.