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NRF cautious about 2005 retail sales
At its recent conference and expo, the National Retail Federation (NRF) released a guarded forecast for 2005, predicting that GAFS sales will only increase 3.5 percent from last year.
For starters, strong comparisons will make this year more difficult for growth, said NRF. Last year GAFS (general merchandise stores, apparel stores, furniture and home furnishings stores, electronics and appliances stores, and sporting goods, hobby, book and music stores) sales rose 9.9 percent in the first quarter, which will make first quarter growth this year hard to achieve, it said. This year, due to tough comparisons, NRF is predicting growth of 3.7 percent for the first quarter.
NRF’s retail sales forecast is restrained this year for a variety of other reasons. “This year, consumers will be under increased financial pressure due to higher energy costs and slow wage growth,” said NRF Chief Economist Rosalind Wells. “Additionally, past stimuli provided by tax cuts and very low interest rates will no longer be there to boost consumer spending.”
Additionally, the labor market will be a telling factor in the level of growth retailers will experience this year. “The consumer has been remarkable in shouldering this economic expansion, but now something has got to give,” said Wells. “The labor market will continue to expand this year, though our concern is that modest employment growth will lead to modest income growth, which will put a financial strain on consumers.”
Discounters will continue to be challenged as their core consumers are most affected by higher energy costs and slow income growth. And, as the housing market softens, the furniture and home furnishings sector could begin to experience slower growth.
GAFS sales grew 6.7 percent in 2004, the highest retail sales growth since 1999.
In other news, NRF is broadening the retail categories it tracks, adding food and beverage stores, building materials and garden equipment stores, health and personal care stores, and miscellaneous retailers including florists and gift shops. It will release a revised historical retail analysis and forecast at the beginning of the second quarter.
Hi-Tec releases U.S. net sales for 2004
Despite the decline in the hiking market, Hi-Tec Sports USA’s 2004 net sales for North America were up 15.2 percent to $25,392,420. 2003’s net sales were $22,052,408. The company said the sales increase is attributed to a renewed focus on product development, response to consumer trends by evolving current product categories (such as adventure sport), and new category extensions. Growing categories for the shoemaker are its sandals, backpacking and winter collections. Hi-Tec also said its average price per pair of shoes sold has increased $15 in two years, adding that its global re-branding efforts in 2003 and 2004 have repositioned it as a quality footwear brand rather than a budget boot company.Â
Sportsman’s Guide expects strong numbers for Q4 and FY04
The Sportsman’s Guide (Nasdaq: SGDE) expects to report results for the fourth quarter and full year 2004 above its guidance and at the high end of consensus estimates. For the quarter ended Dec. 31, 2004, the company said it now anticipates reporting total consolidated sales in the range of $92 million to $93 million and earnings per share in the range of $0.83 to $0.85. Fourth quarter 2003 sales results were $71.7 million and earnings of $0.71 per share. For the year, The Sportsman’s Guide expects consolidated sales in the range of $232 million to $233 million and earnings per share in the range of $1.40 to $1.42. Full year 2003 results were $194.7 million in sales and earnings of $1.16 per share. Originally, estimates for 2004 were for sales of $229 million and for earnings of $1.41 per share. The company said the numbers are up because of the strong performance of The Golf Warehouse acquisition and the strong growth of The Sportsman’s Guide, especially Internet-related sales.
L.L. Bean reports it is on track for $1.3 billion in sales
Thanks to a strong finish to the holiday shopping season, L.L. Bean has reported the company should reach $1.3 billion in sales. Overall holiday sales climbed 10 percent over the same period in 2003, but much of the selling activity occurred after Dec. 7 as a rush of consumer buying boosted sales by as much as 35 percent through Christmas Eve.
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