Inside This Issue - News
May same-store sales are surprisingly good
June 18th, 2012
NEW YORK – Despite worries about consumer confidence and the health of the economy, retailers posted stronger-than-expected sales in May.
The Thomson Reuters Same Store Sales index, which tracks 18 chains that report monthly sales, rose 3.9% for May. That was better than the 3.6% rise predicted by Wall Street analysts, but well below the 5.4% increase recorded last May.
May is the fourth-biggest month in the year for retail sales, according to the National Retail Federation. Mother’s Day is one reason, and the fact that the holiday fell later in the month this year reportedly helped give results a boost.
Increased consumer confidence certainly was not the reason for the industry’s stronger-than-expected performance. Consumer confidence in May fell to its lowest level since the start of the year, according to The Conference Board.
Target Corp. said its net retail sales for the four weeks ended May 26 were $5.04 billion, an increase of 5% over the comparable prior-year period. Same-store sales increased 4.4%.
"Target’s May comparable-store sales were at the high end of our expected range," said Target chairman, president and chief executive officer Gregg Steinhafel. "As we reflect on Target’s first 50 years and celebrate the power of our brand, the resilience of our strategy and the strength of our talented team, we’re confident that Target is well-positioned to continue delivering a superior guest experience and strong financial performance for many years to come."
Costco Wholesale Corp.’s May sales totaled $7.67 billion, an increase of 7% over last year. Same-store sales advanced 4%, which was below analyst expectations. A strong dollar reduced the value of its overseas sales, the company said.
Duckwall-ALCO Stores Inc. reported that sales from continuing operations, excluding fuel, increased 4.4% to $40.1 million for the fiscal four-week period ended May 27. Same-store sales, excluding fuel, increased 1.8%.
"May sales were in line with expectations, as we continue to see increases in our hard lines, commodities and home divisions," said president and chief executive officer Rich Wilson. "We are experiencing growth in toys, outdoor furniture, hardware, candy, food and pet supplies departments. We are also pleased with initial results from our new stores in Conifer, Colo., and Pinedale, Wyo."
Dollar General Corp. reported that total retail sales for May increased 13.7%, to $507.2 million; same-store sales rose 4.9%. Customer transactions in same stores rose about 4.7%.
Rite Aid Corp. reported a 1.1% increase in same-store sales for May, with front-end same-store sales advancing 1.3% and prescription same-store sales rising 1%, hurt by the negative impact of new generic drug introductions. Prescription count at comparable stores increased 2.6% over the prior-year period, the company said.
Rite Aid’s total sales increased 0.3% in May, to $2.45 billion.
Walgreen Co. reported May sales of $5.98 billion, a decline of 1.6% compared with May of last year. Same-store sales declined 5.8%. Total front-end sales increased 0.3%, while same-store front-end sales decreased by 1%. Customer traffic in comparable stores decreased by 2.3%, while basket size increased 1.3%.
Prescriptions filled at comparable stores decreased 7.6% in May, mainly due to the impact of Walgreens’ no longer being part of the Express Scripts Inc. pharmacy network. Total pharmacy sales declined 3.9%.
"Since January 1 our underlying trend for number of prescriptions filled has improved," said Walgreens executive vice president and chief financial officer Wade Miquelon. "Looking forward, we expect our number of prescriptions filled to be helped as employers and health plans take a variety of steps ranging from changing prescription benefit managers to changing language in new RFPs to provide continued access to Walgreens and our services.
"In what is the busiest selling season in recent memory, we are pleased that we have continued to receive notification of pharmacy plans regaining access to Walgreens pharmacies with new contracts that become effective throughout the remainder of the year. In addition, we extended our multiyear agreement to build on our strategic partnership with OptumRx, one of the largest pharmacy benefit managers in the United States."