Retailers November Sales Show Healthy Start To Holiday Season

Based on early sales results from retailers, consumers appeared to have come out their shells in November, making the start of the holiday-buying season a successful one.

Many retailers started the holiday season early in November, blitzing shoppers with promotions because of concerns that the still-uncertain economy would hold them back.

"Retailers' game plan was aggressive promotions throughout the month," said John Long, retail strategist at Kurt Salmon Associates. "The results we are seeing are not solely the contribution of Black Friday sales."

The strong early start has prompted some to wonder if the consumer will continue to spend throughout the holiday season. The National Retail Federation projects holiday sales will rise 2.3% this year after 0.4% gain in 2009 and a 3.9% drop in 2008.

Teen retailers are at the extremes of the stores that have reported same-store sales so far, showing the fickleness of the main demographic that shop at those chains as well as the power of aggressive discounts.

Abercrombie & Fitch Co. (ANF) said same-store sales rose 22%, well above the average analyst estimate of 6.8% on Thomson Reuters. Abercrombie's aggressive promotions likely weighed on low-price teen retailer Aeropostale Inc. (ARO), which surprised Wall Street by reporting a 1% drop in same-store sales, when analysts were expecting growth of 0.9%.

Aeropostale added that holiday sales trends "decelerated significantly" after Black Friday.

Fellow teen retailer Zumiez Inc. (ZUMZ) said it didn't experience the same post-Black Friday sales deceleration as Aeropostale. On its conference call, Zumiez said its Black Friday and holiday weekend same-store sales results were similar to November's full-month comp results of 20.7%, above the Street's estimate of 12.6%.

Hot Topic Inc. (HOTT) has reported the worst same-store sales figure so far, based in part on tough year-ago comparisons from sales of products related to the "Twilight". However, the company's comp of negative 2.1% was still narrower than the Thomson Reuters' estimate of a 4.6% decline.

The figures for the majority of retailers reporting November same-store sales are through Saturday, which is when they closed their books for the month. The 28 retailers tracked by Thomson Reuters are expected to show same-store sales growth of 3.6% for November, up from the year-ago gain of 0.6%.

The world's largest retailer, Wal-Mart Stores Inc. (WMT), does not report sales on a monthly basis.

Costco Wholesale Corp. (COST), the largest warehouse club in the U.S., reported a 9% rise in sales at stores open more than a year, aided by higher gas prices and stronger foreign currencies. The results beat analysts' projections for a 6.2% increase.

Limited Brands Inc. (LTD), operator of Victoria's Secret and Bath & Body Works, said same-store sales rose 10%, when analysts projected a 4% rise.

The reports generally keep with the strong industry numbers that came in for the Black Friday weekend, showing sales and customer traffic rose.

About 212 million shoppers visited a store or website over the weekend, an 8.7% rise from last year, the National Retail Federation said. The average shopper spent $365.34, a 6.4% gain. ShopperTrak, a retail consulting firm, said sales rose only a bit on Black Friday itself but still set a record.

-By Karen Talley, Dow Jones Newswires; 212-416-2196; karen.talley@dowjones.com

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