Although many retailers appeared to find their stride, 2018 was not without its ups and downs for footwear and apparel sellers, as well as their shareholders.
Toward the end of the year, the stock market saw sizable swings in both directions on a regular basis, with the Dow Jones Industrial Average marking its worst December since the Great Depression.
Despite strong consumer confidence, low unemployment and tumbling fuel prices, retailers saw most of their early year gains wiped out — a decline that unfortunately extended into the all-important holiday shopping season. (The National Retail Federation predicted that holiday retail sales during November and December would advance between 4.3 and 4.8 percent over the same period last year.)
Keeping track of results, FN rounds up retailers’ sales numbers and profit outlooks as we enter 2019.
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Genesco Inc.
Genesco Inc. stock shed 0.42 percent in late-afternoon Jan. 14 trading despite its announcement that comparable sales grew 4 percent for the quarter-to-date period ended Jan. 10. The specialty retailer, which reiterated its full-year guidance, saw Journeys’ same-store sales jump 7 percent, Johnston & Murphy gain 5 percent and Lids Sports up 2 percent — partially offset by Schuh’s 9 percent slide.
“Overall, we enjoyed a very solid holiday selling season, with stronger-than-expected results,” said president and CEO Robert J. Dennis. “January is off to a good start, helped in part by favorable comparisons against periods of bad weather and earlier school reopenings in some markets last year.”
The company expects the fiscal year’s adjusted earnings per diluted share to be in the range of $3.10 to $3.40. It will release fourth-quarter results on March 14.
J.C. Penney Co. Inc.
On Jan. 8, JCPenney revealed that its comparable sales dropped 3.5 percent on an adjusted basis (or 5.4 percent on an unshifted basis) during the holiday season. The company also announced the shuttering of three stores this spring as it continues to evaluate its brick-and-mortar portfolio.
Additionally, the beleaguered department store chain reaffirmed its expectations to “generate positive free cash flow in fiscal 2018” as well as cut down inventory by $225 million, or 8 percent, and end the year with liquidity in excess of $2 billion.JCPenney will report full fourth-quarter earnings and full-year results on Feb. 28.
Kohl’s Corp.
Shares at Kohl’s dipped nearly 10 percent on Jan. 10 after the Milwaukee-based retailer noted a rise of just 1.2 percent in same-store sales for the last two months, compared with 6.9 percent the same time in 2017. However, robust growth in its digital business allowed the company to raise its full-year guidance to a range of $5.50 to $5.55, versus its prior outlook of $5.35 to $5.55.
“The strong performance we achieved this holiday reflects the compelling product offering, great marketing strategy and consistent execution in stores and online,” CEO Michelle Gass said in a statement. “We are particularly pleased with the positive transaction growth and the double-digit digital growth we experienced this holiday as our customers continue to embrace the omnichannel investments we are making.”
Kohl’s reports fourth-quarter earnings on March 5.
L Brands Inc.
L Brands slid 8 percent in Jan. 10 morning trading following its report that sales for the five-week period ended Jan. 5 were $2.48 billion, down from $2.51 billion the prior year. Comparable store sales stayed flat during the same time, but the Columbus, Ohio-located company announced that it would adjust fourth-quarter earnings per share toward the higher end of its former outlook of $1.90 to $2.10.
Closing on the sale of its La Senza business on Sunday, L Brands remains parent to Victoria’s Secret, Pink, Bath & Body Works and Henri Bendel. In September, it was revealed that Bendel’s website and all of its 23 stores would shut down by the end of January “to improve company profitability and focus on our larger brands that have greater growth potential.”
Macy’s Inc.
Announcing results for November and December, Macy’s said it saw positive yet weaker-than-expected holiday revenues, ultimately cutting its 2018 earnings outlook to a range of $3.95 to $4 (from $4.10 to $4.30). The storied retailer’s shares declined more than 18 percent on Jan. 10 after it also reported same-store sales that were up only 1.1 percent for the final months of 2018.
“The holiday season began strong — particularly during Black Friday and the following Cyber Week but weakened in the mid-December period and did not return to expected patterns until the week of Christmas,” chairman and CEO Jeff Gennette explained in a statement. “Looking back at 2018, we met our goal of returning the company to growth. Our revised guidance is above the expectations we set at the start of the fiscal year, and we expect to deliver our fifth consecutive quarter of positive comparable sales.”
The Cincinnati-based company is expected to release its next earnings report on Feb. 26.
Nordstrom Inc.
Nordstrom shares fell on Jan. 16 a day after the retailer reported disappointing holiday sales. The Seattle-based company saw a comparable sales increase of 1.3 percent for the nine weeks ended Jan. 5, versus the same period in the prior year.
In off-price, those same-store sales were up 3.9 percent, but full-price saw a gain of just 0.3 percent. Online sales, on the other hand, climbed 18 percent during the holiday shopping season, with the division representing 36 percent of total sales.
A statement revealed that expectations for its diluted earnings per share for the fiscal year will now be on the lower end of a previously estimated outlook range of $3.27 to $3.37. The company will announce its fourth-quarter and full-year results on Feb. 28.
Target Corp.
Despite comparable store sales improving 5.7 percent for the holiday months (versus 3.4 percent in 2017), Target shares suffered a drop of 4 percent on Jan. 10. The Minneapolis-headquartered company maintained its outlook for the fourth quarter and the 2018 fiscal year, adding that it was on track to grow digital sales more than 25 percent for the fifth consecutive year.
“We are very pleased with Target’s holiday season performance, which came on top of really strong results in the same period last year,” chairman and CEO Brian Cornell remarked. “This performance demonstrates the benefit of placing our stores at the center of every way we serve our guests, including both in-store shopping and digital fulfillment.”
Additionally, the company announced that chief financial officer Cathy Smith will retire this year, serving in the role until a successor is named.
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