By Ben Fox Rubin
Next week will bring many retailers' earnings reports, giving
markets a fuller impression on the strength of the consumer during
the start of the year. Also, A123 Systems Inc.'s (AONEQ) bankruptcy
proceedings are expected to move forward.
Retailers to Report Earnings
A large grouping of retailers will be releasing their earnings
results next week, amid a relatively slow time for quarterly
reports.
One of the most notable companies reporting is Costco Wholesale
Corp. (COST), whose sales have routinely topped Wall Street's
expectations in recent quarters, thanks in part to a shaky economy
encouraging shoppers to make bulk purchases at its warehouse clubs.
But like many other retailers, Costco has faced rising costs for
merchandise. The company is expected to post improved fiscal
second-quarter earnings Tuesday.
Teen apparel retailer Hot Topic Inc. (HOTT) is also slated to
report next week, coming on the heels of its deal to be taken
private by New York-based private-equity firm Sycamore Partners for
about $600 million in cash. Shares have surged on the $14-a-share
offer price, a 30% premium to Hot Topic's closing price just before
the deal was announced. Analysts project its fiscal fourth-quarter
earnings will rise.
Other retailers reporting next week include Urban Outfitters
Inc. (URBN), Dick's Sporting Goods Inc. (DKS), Bon-Ton Stores Inc.
(BONT), Cache Inc. (CACH), Men's Wearhouse Inc. (MW), Aeropostale
Inc. (ARO), Zumiez Inc. (ZUMZ), Coldwater Creek Inc. (CWTR),
Express Inc. (EXPR) and Buckle Inc. (BKE).
A handful of U.S. retailers this week reported moderate sales
for February, as they dealt with mixed factors like payroll-tax
increases and later income-tax refunds that were countered by a
rousing stock market and better housing reports. Thomson Reuters
said 11 retailers still issuing monthly same-store sales, excluding
drug stores, on average posted 3.9% same-store sales growth for
February. This compares with a 7.4% rise for the 11 a year ago.
Earnings Grab-bag
Chinese social-networking company Renren Inc. (RENN) and Chinese
online-game maker Perfect World Co. Ltd. (PWRD) are both expected
to report next week. They will join fruit and vegetable producer
Dole Food Co. Inc. (DOLE), doughnut chain Krispy Kreme Doughnuts
Inc. (KKD) and Scientific Games Corp. (SGMS), which sells
instant-ticketing systems to lotteries.
Court to Take Up A123 Bankruptcy Payment Plan
A123 Systems Inc. (AONEQ) next week will ask a bankruptcy court
to let its creditors begin voting on its plan to pay them from the
proceeds of its asset sales.
The Wilmington, Del., bankruptcy court on Wednesday will
consider A123's disclosure statement, or payment-plan outline,
which creditors rely upon to cast informed votes.
The maker of batteries for electric cars sought Chapter 11
protection last fall and later sold the bulk of its assets to
China's Wanxiang Group for $256.6 million.
To avoid concerns about a Chinese company getting the assets to
A123's military contracts and taxpayer-funded technology, A123 sold
its government business separately. Navitas Systems of Chicago won
the bidding with a $2.25 million offer.
(Jacqueline Palank contributed to this story.)
-Write to Ben Fox Rubin at ben.rubin@dowjones.com
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