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September sales soft as consumers are cautious

NEW YORK — What should have been a strong comparison month for retailers — given the dive sales took following the terrorist attacks last September — instead was a continuation of the same as many retailers tussled with the poor economy and ongoing political issues resulting in a mere 2.1 percent gain in overall chain store sales versus last September.

To make matters worse, the situation with the West Coast ports has impacted shipments and necessitated contingency plans.

With all of that, however, some retailers reported that the home category was a bright spot last month.

Kohl's was one of the surprises of the month, as it turned in a rare negative comp-store sales decline of 3.2 percent for September. Larry Montgomery, ceo, attributed the disappointing sales to the performance of all seasonal apparel businesses, which were significantly below last year. Kohl's still achieved a positive total sales growth, climbing 8.5 percent to $675.5 million.

He added, however, that the company feels very good about its fall and holiday season. "We will continue to be aggressive in our marketing and are focused on increasing market share," Montgomery said. "As a result, we remain comfortable with Wall Street's earnings expectations for the fourth quarter."

Wal-Mart Stores posted comp-store gains of 3.3 percent for the total company and sales of $21.9 billion, a 10.4 percent jump. The Wal-Mart division, which had its comps climb 3.6 percent, noted that home furnishings was one of its above-average categories, while Sam's Club, with a 1.6 percent increase in comps, listed domestics among its strongest categories.

JCPenney's department stores' comp-store sales decreased 3.1 percent for September, though that was compared to a strong 8.1 increase last year. The company did point out that home is one of its best performing categories.

Though its apparel business was negatively impacted by the warm weather, TJX's "home fashions business, typically not as weather-sensitive, has continued to be strong," said Edmond English, president and ceo, and the category climbed 9.0 percent for the month. By division, MarMaxx, which includes Marshalls and T.J. Maxx, had 2.0 percent comp-store sales drop, and A.J. Wright and Winners both fell 1.0 percent, while HomeGoods and T.K. Maxx both had positive spurts of 11.0 percent and 5.0, respectively.

Pier 1 Imports reported a great month, and led the others in comp-store increases, at 7.4 percent. "We are pleased to report that we met our September sales projections," said Marvin Girouard, chairman and ceo. "Traffic and average ticket were both higher than September 2001, and business was consistent across all regions. The mix of regular-priced sales and promotional sales continued to be favorable compared to last year."

Girouard added that the company should not be impacted by the West Coast port slowdowns and closings. "The company expects no significant adverse effects on its current operations since almost all seasonal merchandise purchased for the holiday selling season has already been received into the stores and distribution centers. Also, other merchandise has been received in sufficient qualities to support promotional events and regular sales through the third quarter and into the fourth quarter."

Jo-Ann Fabrics also said that it doesn't think the West Coast situation will impact its fourth quarter holiday season, since more than 90 percent of its imported merchandise for the Christmas selling season has already been received.

Target Corp. said that inventories at both Target Stores and Mervyn's were in very good condition at month's end and had little risk of markdowns, though the delays related to resuming business at the ports may result in some markdown risk moving forward. Gottschalks is "continuing to monitor our inventory levels carefully, and we are reacting accordingly to sales trends by merchandise category," said Jim Famalette, president and ceo. "It is difficult to accurately predict the potential effect of the recent shutdown of West Coast ports, but as of this date we have experienced very little impact on our inventory receipt flow."

Gottschalks did, however, have a strong performance in its home division, led by textiles, furniture and housewares.

Ross Stores called its home businesses "standout performers" during September, with same-store sales increases in the mid teens.

Elder-Beerman found all of its home categories to be among the best for September.

The home division at Dillard's decreased 3 percent, which was above the company average.

TOP 3
Company % chg.
Pier 1 Imports 7.4%
Ross Stores 7.0
Hancock Fabrics 6.1
BOTTOM 3
Company % chg.
Value City dep't. stores -11.8%
Marshall Field's -10.1
Pamida -9.0


September sales for major retailers (period ending 10/5/02)a
(sales in $millions)

Company 2002 sales 2001 sales Total % change Same-store % change
a: Reporting periods vary from store to store.
b: Will not report numbers until emerges from Chapter 11.
c: For the period ending Oct. 6.
d: For the period ending Oct. 4.
e: For the period ending Sept. 28.
f: Excludes sales of stores that have been closed and not replaced.
Amesb NA NA NA NA
Costcoc $3,590.0 $3,260.0 10.1% 5.0%
Dillard Dept. Stores 687.0 727.8 (5.6) (5.0)
Dollar Generald 567.6 497.0 14.2 5.0
Elder-Beerman 58.3 59.5 (2.0) (0.8)
Family Dollar 402.6 350.3 14.9 4.1
Federated 1,315.0 1,289.0 2.0 0.0
Gottschalks 56.2 56.3 (0.2) 1.4
Hancock Fabricsc 43.3 39.4 9.9 6.1
JCPenneye 2,830.0 2,832.0 (0.1) NA
Dept. stores 1,242.0 1,290.0 (3.7) (3.1)
Catalog/e-commerce 217.0 262.0 (17.2) NA
Jo-Ann Storesc 159.6 155.6 2.6 5.0
Kmartb NA NA NA NA
Kohl's Corp. 675.5 622.6 8.5 (3.2)
May Dept. Stores 1,143.9 1,177.0 (2.8) (6.2)
Pier 1 Imports 152.8 130.6 17.0 7.4
Ross Stores 314.0 263.0 19.4 7.0
Saks Inc. 561.5 553.0 1.5 3.3
Dept. stores 325.5 332.6 (2.1) (2.1)
Sears U.S. sales 2,433.7 2,511.5 (3.1) (5.9)
ShopKof 272.0 282.1 (3.6) (3.2)
Shopko stores 204.7 NA (1.2) (1.2)
Pamida 67.3 NA (10.3) 9.0
Stein Mart 128.4 NA 12.5 4.0
Target Corp. 3,507.0 3,275.0 7.1 (0.8)
Target 2,927.0 NA 9.6 0.4
Mervyn's 293.0 NA (4.0) (3.5)
Marshall Field's 232.0 NA (10.1) (10.1)
TJX Cos. 1,131.0 1,044.0 8.3 (1.0)
Value City 225.4 219.7 2.6 (7.5)
Value City Dept. stores 129.1 137.6 (6.2) (11.8)
Wal-Mart Stores Inc.d 21,901.0 19,844.0 10.4 3.3
Wal-Mart stores 14,064.0 12,634.0 11.3 3.6
Sam's Club 2,870.0 2,689.0 6.7 1.6
35 weeks to date
Amesb NA NA NA NA
Costcoc NA NA NA NA
Dillard Dept. Stores $5,013.8 $5,096.5 (1.6%) (2.0%)
Dollar Generald 3,900.0 3,300.0 16.5 7.5
Elder-Beerman 379.0 376.5 0.7 (2.4)
Family Dollar NA NA NA NA
Federated 9,338.0 9,462.0 (1.3) (2.9)
Gottschalks 409.6 421.8 (2.9) (0.7)
Hancock Fabricsc 270.8 250.8 8.0 7.3
JCPenneye 20,266.0 20,050.0 1.1 NA
JCPenney stores 8,907.0 8,848.0 0.7 1.8
Catalog/e-commerce 1,603.0 2,074.0 (22.7) NA
Jo-Ann Storesc 997.1 918.8 8.5 9.4
Kmartb NA NA NA NA
Kohl's Corp. 5,136.1 4,186.5 22.7 6.9
May Dept. Stores 8,377.8 8,486.9 (1.3) (4.6)
Pier 1 Imports 948.2 813.3 16.6 7.4
Ross Stores 2,289.0 1,900.0 20.5 9.0
Saks Inc. 3,600.5 3,677.8 (2.1) (0.2)
Dept. stores 2,127.9 2,147.7 (0.9) (0.5)
Sears U.S. sales 18,124.5 18,597.0 (2.5) (5.1)
ShopKof 2,037.4 NA (1.3) (0.9)
Shopko stores 1,535.8 NA 0.8 0.8
Pamida 501.7 NA (7.0) (5.7)
Stein Mart 893.9 NA 10.1 0.2
Target Corp. 25,865.0 NA 11.2 2.8
Target 21,763.0 NA 14.3 4.2
Mervyn's 2,275.0 NA (3.5) (3.2)
Marshall Field's 1,558.0 NA (3.7) (3.7)
TJX Cos. 7,528.0 6,682.0 12.7 3.0
Value City 1,569.1 1,468.3 6.9 (3.4)
Value City Dept. stores 945.4 941.1 0.5 (5.2)
Wal-Mart Stores Inc.d 156,103.0 139,169.0 12.2 6.2
Wal-Mart stores 100,507.0 88,375.0 13.7 6.7
Sam's Clubs 20,575.0 18,832.0 9.3 3.9


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