Holiday Retail Sales Season Ends With 4.1% Rise, NRF says

Photo Credit: Reuters

Retail industry sales for the 2011 holiday season increased 4.1 percent, year-over-year, to $471.5 billion, according to the National Retail Federation, beating its expectation of 3.8 percent growth.

The holiday season defined by NRF runs from November 1 till December 31. Sales figures exclude automobiles, gas stations, and restaurants.

"The right mix of strong promotions, lean inventories and an emphasis on value put retailers in the perfect position to end the year on a high note," said Matthew Shay, NRF president and CEO. “A better-than-expected holiday season is welcome news for an economic recovery that continues to be sluggish, and demonstrates retail’s powerful role as an engine of growth.”

December retail industry sales increased 4.1 percent unadjusted year-over-year and declined .06 percent seasonally adjusted from November.

Meanwhile, the U.S. Commerce Department reports that December retail sales (which include non-general merchandise categories such as autos, gasoline stations and restaurants) increased 0.1 percent seasonally adjusted over November and 6.2 percent unadjusted year-over-year.

Consumers stocked up on discretionary gift items in December, including home décor items, sporting goods, books and personal care items, NRF said. Despite a warmer-than-usual month, apparel sales performed extremely well. Though electronics and appliance stores saw growth in November, the shift in spending put a damper on those stores’ December sales.

Birks & Mayors Holiday Sales Total $79.5 Million

Luxury jewelry retailer Birks & Mayors Inc.said Tuesday that net sales during holiday season (October 30, 2011, - December 24, 2011) increased by 5 percent, year-over-year, to $79.5 million.

The $4 million increase in net sales was driven by 3 percent increase in comparable store sales and higher revenues related to precious metal refining services offered to the company’s customers in Canada, partially offset by $600,000 of lower sales related to translating the sales of the company’s Canadian operations into U.S. dollars with a relatively weaker Canadian dollar.

The Montreal-based company’s primary business is the ownership and operation of the Birks luxury jewelry retail chain in Canada and the Mayor’s luxury jewelry retail chain in the southeastern United States.

Comparable store sales during the holiday season increased by 3 percent on a consolidated basis with comparable store sales in Canada increasing by 4 percent and U.S. comparable store sales growing by 2 percent, the company said. The stronger sales results in both Canada and the U.S. reflect an increase in the average sale.

“The holiday season began with good sales momentum, however, during the final weeks before Christmas we experienced strong declines in customer traffic in our stores,” said Thomas A. Andruskevich, Birks & Mayors president and CEO. “As such, our sales increases during the holiday period were somewhat softer than what we would have liked to see.”

Tiffany Holiday Sales Up 11%

Tiffany & Co. said Tuesday that its worldwide net sales during the two-month holiday period ended December 31, 2010, rose 11 percent over the prior year to $888.5 million. On a constant-exchange-rate basis (which excludes the effect of translating foreign-currency-denominated sales into U.S. dollars) worldwide net sales increased 10 percent and comparable store sales rose 8 percent. All regions reported strong sales increases with double-digit sales growth in Asia and Europe.

Because of the higher-than-expected growth in sales during the holiday period, the management of the luxury jewelry company has increased its global sales outlook to $3.1 billion for the fiscal year ending January 31, 2011.

Net sales highlights by region:

* Sales in the Americas, which includes the U.S., Canada and Latin/South America, increased 9 percent to $484.8 million. On a constant-exchange-rate basis, sales rose 9 percent and comparable store sales increased 7 percent (comparable Americas' branch store sales rose 8 percent and sales in the New York flagship store increased 3 percent). Internet and catalog sales in the Americas increased 8 percent.

* Sales in Japan increased 11 percent to $142.5 million. On a constant-exchange-rate basis, total sales rose 3 percent and comparable store sales increased 2 percent.

* Sales in the Asia-Pacific region (which Tiffany reports separately from Japan) rose 23 percent to $138.9 million. On a constant-exchange-rate basis, sales increased 18 percent due to growth in most countries, and comparable store sales rose 15 percent.

* Sales in Europe increased 13 percent to $114.9 million. On a constant-exchange-rate basis, sales rose 21 percent due to growth in the U.K. and most of continental Europe, and comparable store sales increased 15 percent.

* Other sales declined 45 percent to $7.4 million. The company this came from an expected decrease in wholesale sales of rough diamonds (following higher-than-normal sales in the previous year), partly offset by increased wholesale sales of finished goods to independent distributors within emerging markets.

“We are very pleased with this worldwide sales growth, and with the increases we saw in every region in both months of the holiday period,” said Michael J. Kowalski, Tiffany chairman and CEO. Healthy sales growth was seen across most product categories, with particular strength in Tiffany's fine jewelry collections, diamond engagement rings and fashion gold jewelry, although with limited growth in silver jewelry sales.”

During the holiday period, the New York-based company opened U.S. stores in Houston, Jacksonville and Los Angeles; Asia-Pacific stores in China (Kunming) and Korea (Seoul); and European stores in Spain (Barcelona) and the U.K. (London). The company operates 232 stores (96 in the Americas, 56 in Japan, 51 in Asia-Pacific and 29 in Europe), versus 220 stores a year ago.

Zale Corp. Reports Strong Holiday Sales for Second Consecutive Year

Zale Corp. said Tuesday that comparable store sales increased 5.9 percent, year-over-year, for the November-December holiday sales period. This increase follows an 8.5 period rise in the same period in the prior year.

Within this two-month period, comparable store sales increased 10.1 percent in November and 4.2 percent in December. At constant exchange rates, which exclude the effect of translating Canadian currency denominated sales into U.S. dollars, comparable store sales increased 6.2 percent for the holiday selling period, compared to an increase of 7.6 period in the prior year period.

Revenues for the two-month period increased 5.8 percent, year-over-year, to $564 million. Revenues include approximately $10 million resulting from the change in warranty revenue recognition.

Zale Corp. operates approximately 1,820 retail locations in the United States, Canada and Puerto Rico and has online operations for most of its brands.

Sales by brand and country:

* U.S. Fine Jewelry brands (which account for about 69 percent of annual revenue for the company), consisting of Zales Jewelers, Zales Outlet and Gordon’s Jewelers, had an increase in comparable store sales of 9 percent for the holiday period. This increase follows a 7.5 period rise in the same period last year.

* Canadian Fine Jewelry brands (which account for about 17 percent of annual revenue for the company), consisting of Peoples Jewellers and Mappins Jewellers, had an increase in comparable store sales of 0.2 percent. This increase follows a 15.6 percent rise in the same period last year. At constant exchange rates, Canadian Fine Jewelry brands comparable store sales increased 1.7 percent, compared to an increase of 10.2 percent in the prior year period.

* Kiosk Jewelry (which accounts for about 14 percent of annual revenue for the company) comparable store sales decreased 2.1 percent. In the same period last year, Kiosk Jewelry comparable store sales rose 4.2 percent.

In its outlook for the quarter ending January 31, Zale Corp. says it expects gross margin to be consistent with the prior year quarter’s gross margin of 50.3 percent. Operating margin is expected to be slightly below the prior year quarter’s operating margin of 7 percent due to higher selling, general and administrative expenses primarily driven by the holiday advertising campaign and marketing for the launch of proprietary products.

Zale Corp. Holiday Comps Up 2.3%; Holiday Sales Total $567 Million

Jewelry and diamond retailer, Zale Corp., said Thursday that same store sales increased 2.3 percent for the combined months of November and December 2012, encompassing the entire holiday selling period. This increase falls short of the 5.9 percent rise in same store sales for the same period last year. At constant exchange rates, which exclude the effect of translating Canadian currency denominated sales into U.S. dollars, comparable store sales increased 1.6 percent for the holiday selling period, compared to an increase of 6.2 percent in the prior year period.

Revenues for the two-month period were $567 million, an increase of $3 million compared to $564 million in the same period last year. The increase in revenues is primarily due to the same store sales growth partially offset by revenues associated with the net decrease of 50 stores compared to last year.

“This holiday season, we focused on driving bottom line improvement,” said Theo Killion, Zale Corp. CEO. “Our comp performance, combined with an expected 100 basis point operating margin improvement, brings us closer to our goal of achieving positive net income for the fiscal year.”

Holiday selling period same store sales details are as follows:

* Zales branded stores, consisting of Zales Jewelers and Zales Outlet, posted an increase of 3.1 percent, compared to an increase of 10 percent in the same period last year. U.S. fine jewelry brands including regional brand, Gordon’s Jewelers, posted an increase of 2.2 percent. In the same period last year. U.S. fine jewelry brands same store sales rose 9 percent for the 2011 holiday season.

* Canadian Fine Jewelry brands, consisting of Peoples Jewellers and Mappins Jewellers, posted a same store sales increase of 2.7 percent. This increase follows a 0.2 percent rise in the same period last year. At constant exchange rates, Canadian Fine Jewelry brands posted a comparable store sales decline of 0.7 percent, compared to an increase of 1.7 percent in the prior year period.

* Piercing Pagoda, Zale Corp.’s kiosk Jewelry business, posted a same store sales increase of 1.7 percent, compared to a declined 2.1 percent for the 2011 holiday season.

In its outlook for the quarter ending January 31, Zale Corp. said it expects gross margin to be in line with the prior year quarter’s gross margin of 50.5 percent. Operating margin is expected to be approximately 7.5 percent, or 100 basis points higher than the prior year quarter, primarily as a result of improved leverage on selling, general and administrative expenses.

As previously announced, the company expects to achieve positive net income for fiscal year 2013.

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Signet Holiday Same Store Sales Up 7.8%

Kay Jewelers is operated by Signet Jewelers.

Signet Jewelers Ltd. said Tuesday that same-store sales for the nine-week holiday season grew by 7.8 percent, year-over-year.

The Bermuda-based company bills itself as the largest specialty retail jeweler in the U.S. and the U.K.,

In the U.S., which accounts for about 80 percent of total group sales, same-store sales increased 9.2 percent for the holiday period. The company operates Kay Jewelers, Jared The Galleria Of Jewelry and a number of regional brands.

In the U.K., which accounts for about 20 percent of total group sales, same-store sales rose by 1.8 percent for the period. Last season, same-store fell in the U.K. The company operates H.Samuel, Ernest Jones, and Leslie Davis retail chains.

Internet sales rose by 24 percent for the period, the company said during a conference call.

Based on the results, the company, which operates approximately 1,860 retail jewelry stores in the U.S. and U.K., now expects its income in fiscal 2012 to increase from 64 to 67 percent to $494 to $501 million.

Tiffany Holiday Sales Up 7%

Holiday sales at Tiffany's New York flagship fell 1 percent.

Tiffany & Co. said Tuesday that its worldwide net sales in the two months ended December 31 increased 7 percent, year-over-year, to $952 million with robust sales in Asia were offset by weaker sales growth in the U.S. and Europe.

“After achieving very strong and better-than-expected sales and earnings growth in the first three quarters of 2011, sales weakened markedly in the United States and Europe during the holiday season, reflecting restrained spending by consumers for fine jewelry,” said Michael J. Kowalski, Tiffany chairman and CEO.

The luxury jeweler reported double-digit sales growth in Asia-Pacific and Japan regions and smaller increases in the Americas and Europe. On a constant-exchange-rate basis excluding the effect of translating foreign-currency-denominated sales into U.S. dollars, worldwide net sales rose 6 percent and same store sales increased 4 percent.

In the Americas region—which includes the United States, Canada and Latin America—sales rose 4 percent to $503 million. On a constant-exchange-rate basis, total sales increased 4 percent and same store sales rose 2 percent—with same Americas' branch store sales rose 3 percent and New York flagship store sales declined 1 percent). Higher sales to tourists from outside the U.S. were partly offset by weakness in spending by U.S. customers. Combined Internet and catalog sales in the Americas were 4 percent below last year.

Sales in the Asia-Pacific region increased 19 percent to $165 million. On a constant-exchange-rate basis, total sales increased 18 percent and same store sales increased 12 percent due to growth in most countries.

In Japan, sales increased 13 percent to $160 million. On a constant-exchange-rate basis, total sales rose 5 percent and same store sales increased 6 percent.

Sales in Europe increased 1 percent to $117 million. On a constant-exchange-rate basis, total sales increased 2 percent and same store sales declined 4 percent, reflecting modest sales growth in Continental Europe and lower sales in the U.K.

The Company currently operates 246 stores (102 in the Americas, 57 in Asia-Pacific, 55 in Japan and 32 in Europe), versus 232 (96 in the Americas,  51 in Asia-Pacific, 56 in Japan and 29 in Europe) a year ago.

Other sales, which primarily include wholesale sales of finished products to independent distributors within emerging markets and wholesale sales of rough diamonds, increased 8 percent to $8 million.

“We are now estimating that earnings per diluted share for the fiscal year ending January 31, 2012 will increase 23 percent – 25 percent to a range of $3.60 - $3.65. This estimate compares with a prior forecast made in November of $3.70 - $3.80 per diluted share and our initial fiscal 2011 outlook provided last March of $3.35 - $3.45 per diluted share,” Kowalski said. “We are in the preliminary stages of financial planning for 2012 and will provide more detailed guidance when we report our full year financial results in March.”