NEW YORK — Early reports from several retailers, including J.C. Penney and Kohl’s, confirmed Wednesday what Wall Street had already expected: a weak start to the back-to-school shopping season. The sluggish August results, which came a day ahead of when most of the nation’s merchants are set to announce sales, weren’t encouraging as the industry prepares for the critical holiday season.
Penney said same-store sales at its department-store business dropped 4.9 percent, slightly better than the 6.3 percent drop that analysts surveyed by Thomson Reuters had projected. Penney also predicted a mid- to high-single-digit decrease in same-store sales for the current month. Same-store sales are sales at stores open at least a year and are considered a key indicator of a retailer’s health.
Kohl’s announced a 5.8 percent drop, though the decline was less steep than the 7.6 percent expected by analysts.
One bright spot was Costco, which announced a 9 percent same-store sales increase in August as higher gas prices boosted sales. Analysts had expected a 9.6 percent gain. The warehouse club has been benefiting as shoppers buy in bulk to save.
“Consumers are spending less this back-to- school season, and it doesn’t bode well for the holiday season,” said Ken Perkins, president of research company RetailMetrics LLC.
The Associated Press
