BENTONVILLE, Ark. - Wal-Mart Stores Inc. and Federated Department Stores Inc. said yesterday that post-Christmas sales weren't strong enough to cushion the worst holiday shopping season in more than three decades.
Wal-Mart said sales at stores open at least a year rose as little as 2 percent, the low end of its forecast. Results for the November-December holiday period at Macy's parent Federated will fall about 4.5 percent, a steeper decline than expected. J.C. Penney Co. said same-store sales at its department stores rose 4.5 percent in December.
Low prices on such items as DVD players and apparel probably didn't attract enough consumers concerned about job cuts to make up for disappointing sales in the weeks before Dec. 25. A small sales gain at Wal-Mart, the world's largest retailer, likely foretells poor results at other merchants, investors said.
"If they're etching out 2 to 3 percent, you can bet that the rest of the industry is below that," said Charles Stutenroth, who helps manage about $26 billion at Fort Washington Investment Advisors Inc., including Wal-Mart and Federated shares.
Michael Niemira, a Bank of Tokyo-Mitsubishi Ltd. economist who has been following retail since 1984, expects November-December same-store sales to rise 1.5 percent from a year earlier, the smallest gain since 1970. Wal-Mart accounts for about a third of the Bank of Tokyo index, which tracks more than 80 retailers.
Sales for the week that ended Saturday fell 9.4 percent from the previous week, said ShopperTrak RCT, a Chicago firm that tracks data from more than 30,000 retail stores. Total retail sales will rise 1 percent this month, the smallest year-over-year monthly gain since September last year, when terrorist attacks hurt consumer spending, ShopperTrak said.
Last week, Wal-Mart lowered its forecast of sales growth for the five weeks ending Jan. 3 to 2 percent to 3 percent from as much as 5 percent after reviewing results through Christmas Eve. Post-holiday clearance sales and gift certificates helped keep results from slipping further, investors said.
"It was not a decisive victory, yet we avoided the worst outcome," said Martin Bukoll, an analyst at Northern Trust Corp., whose $320 billion in assets includes Wal-Mart shares.
Sales at Wal-Mart's discount stores and supercenters, which also sell groceries, are expected to rise about 3 percent, based on results through Dec. 27. Results at its Sam's Club warehouse unit may fall, spokesman Tom Williams said.
Toys, electronics and home furnishings were among the best-selling items in the final week of the holiday-shopping season, the company said. The retailer records revenue from the gift cards when they are used, not when they are bought, Williams said.
This would be the fifth month out of six that sales results have come in below, or at the low end of, the Bentonville, Ark.-based retailer's initial forecasts.
Sales at Federated will fall 2.5 percent this month, the company said. The Cincinnati-based retailer, which also owns Rich's and Bloomingdale's, originally said sales might rise 1 percent in the month, and predicted a decline of as much as 2.5 percent for the two-month period.
J.C. Penney, based in Plano, Texas, said department-store sales were more than forecast for a gain in the "low single-digit" percentage rate, which it hadn't specified. Sales at its Eckerd drugstores rose less than the company's expectations of 6 percent, J.C. Penney said.
Total sales last week rose 13 percent from the year-earlier period, ShopperTrak said.
Total sales for the 26 days between Thanksgiving and Christmas dropped 11 percent to an estimated $113.1 billion from the year-earlier season, which had 32 days, said ShopperTrak.