US retailers including Costco Wholesale and L Brands posted November same-store sales that exceeded analysts’ estimates as early discounts prompted consumers to start spending for the holiday season.
Same-store sales for retailers tracked by Swampscott, Massachusetts-based Retail Metrics rose 4.3 per cent last month, excluding results from drugstores. Analysts’ had estimated a 3 per cent gain.
Retailers began offering holiday deals earlier than ever this year, while lower gas prices, declining unemployment and consumer confidence at the highest level since the recession helped drive shoppers to spend more. The discounts early in the month may explain why sales in the days following Thanksgiving were weaker than some analysts’ had estimated.
“November was OK -- certainly retailers were promotional in November, and that probably contributed to it,” Ed Yruma, a New York-based analyst at Keybanc Capital Markets Inc., said in an interview. “The week before Black Friday we saw retailers begin to pull promotions forward. We saw generally soft results for the weekend and that’s because they pulled some of those sales forward.”
L Brands, which owns the Victoria’s Secret and Bath & Body Works brands, said in a statement today that comparable-store sales rose 8 per cent last month, exceeding the estimate for a 4.1 per cent increase.
Warehouse club Costco also topped estimates, posting a 9 per cent sales increase in sales excluding fuel, compared with a forecast for a 5.7 per cent gain.
A Labor Department report tomorrow is projected to show payrolls climbed in November by more than 200,000 workers for a 10th consecutive month and the unemployment rate held at a six-year low.
Falling gasoline prices are also leaving consumers with more money in their wallets. The national average for regular yesterday was $2.746, data compiled by Florida-based motoring club AAA show.
Bloomberg News, edited by ESM
