U.S. Clothing Retailers Report Mixed July Sales

(RTTNews) - A sampling of U.S. apparel retailers on Thursday reported mixed sales at established stores for the month of July. Sales were positively impacted by discount clearing of summer clothing and the start of the back-to-school season shopping.

Meanwhile, July sales comparisons were unfavorably impacted by the shift of sales tax holidays from July to August in eight states.

The month of July is a typically weak and a transitional month for retailers as shoppers take vacations or save for school shopping. Retailers were seen using aggressive promotions throughout the month in order to clear shelves of summer items ahead of the back-to-school rush, with shoppers picking up summer clearance clothes.

Back-to-school season shopping period is the second-largest retail season of the year after the winter holiday season.

However, according to the National Retail Federation's annual survey, total spending on back-to-school and college items is expected shrink to reach $68 billion in 2015. Families will spend on average $630.36 on back-to-school shopping this year, which is a slight drop from last year.

The sharp deterioration in consumer confidence and employment picture also reportedly saw lower store traffic that resulted in a softer than expected sales. The volatility in financial markets prompted by the situation in Greece and China also appears to have shaken consumers' confidence.

A report released from the Conference Board on July 28 showed that its consumer confidence index showed a substantial deterioration in the month of July after increasing by much more than expected in the previous month of June.

The U.S. consumer confidence index tumbled to 90.9 in July from a downwardly revised 99.8 in June. Economists had expected the index to show a much more modest decrease to a reading of 99.6 from the 101.4 originally reported for the previous month.

Sales at established stores or comparable-store sales is a key retail industry performance metric to gauge activity at store locations that have been open for at least a year.

L Brands, Inc. (LB), the operator of Victoria's Secret and Bath & Body Works chains, said its July comparable store sales increased 3 percent, reflecting strength of its Bath & Body Works Stores. Net sales were $759.5 million, up 3 percent from $735.3 million last year.

Stein Mart, Inc. (SMRT) reported a 3.0 percent increase in comparable store sales for the month of July. Total monthly sales also grew 4.5 percent to $76.6 million from $75.3 million in the prior-year month.

Teen apparel retailer Buckle, Inc. (BKE) announced that comparable store net sales for the month of July decreased 8.1 percent. Net sales also declined 6.7 percent to $73.7 million from last year's $79.0 million. Buckle noted that July sales comparisons were unfavorably impacted by the shift of sales tax holidays from July to August in eight states for 102 stores.

Buckle has begun including online sales in its reported comparable store sales from the February 2015 monthly sales release and for all future periods.

"We are pleased with our second quarter sales results, despite the weaker July which was clearly not in line with our current trend," said CEO Jay Stein.

Value-priced fashion apparel retailer Cato Corp. (CATO) reported that July same-store sales declines 1 percent, while total sales improved 2 percent from last year to $66.9 million.

"July same-store sales were slightly below our current trend of flat," Chairman, President, and CEO John Cato stated.

Another specialty retailer of action sports related apparel, footwear, equipment and accessories Zumiez, Inc. (ZUMZ) reported Wednesday that its comparable store sales for July decreased 7.6 percent, on top of last year's 3.5 percent growth. Total net sales also declined 2.3 percent from last year to $61.4 million.