RAPAPORT...
Consumer Confidence Improves Again
The Conference Board Consumer Confidence Index® rose for the third consecutive month in January. The Index now stands at 55.9, up from 53.6 in December. Consumers stating that jobs are “hard to get” declined to 47.4 percent from 48.1 percent last month, while those claiming jobs are “plentiful” increased to 4.3 percent from 3.1 percent. The proportion of people anticipating a decrease in their incomes fell to 16.2 percent from 18.4 percent. The Consumer Confidence Survey® is based on a representative sample of 5,000 U.S. households. The cutoff date for January’s preliminary results was January 19.
U.S. Jewelry Sales Up in December
Jewelry retailers in the U.S. recorded 6.9 percent sales growth in December 2009 compared with 2008, according to data published in MasterCard Advisors’ SpendingPulse report. Michael McNamara, vice president of research and analysis at SpendingPulse, stated that both high- and low-end jewelry performed well during the month, “while mid-tier, mall-based retailers struggled.”
The company noted that December marked the fourth consecutive monthly gain for jewelry sales. Jewelry was the second-strongest category measured by SpendingPulse in December, behind electronics, which generated sales growth of 7.3 percent.
U.S. Jewelry CPI Grows
The consumer price index (CPI) for jewelry in the U.S. held to its highest level since June 1995 during December 2009, according to data provided by the Bureau of Labor Statistics (BLS). The reading of 161.25 points was 2.6 percent higher than the level achieved in December 2008. For the full year of 2009, the average reading was 157 points, up from 153.79 points in 2008.
December’s index also marked the 23rd consecutive cycle for which the jewelry CPI registered more than 150 points. The index is based upon a reference point of average prices in 1986, which is set at 100 points.
Retail Credit Outlook Stable
Credit conditions remain stable for the nation’s retailers, at least in the immediate future, the Associated Press (AP) reported, citing Moody’s Investors Service. “December [sales in locations open for at least a year] largely met or exceeded our modest expectations, indicating revenues and margins are tracking to levels that will result in most retailers’ credit statistics holding at levels sufficient for us to hold their ratings,” Marie Menendez, Moody’s senior vice president, explained. — Additional reporting provided by Acquire Media.
Tiffany’s Christmas Sales Rise
Tiffany & Co. reported that its holiday season sales increased by 17 percent compared with 2008 to $799.1 million for the two months that ended on December 31, 2009. The jeweler’s sales were up by 15 percent across the Americas to $443.9 million, while its U.S. comparable-store sales increased by 12 percent. Sales rose by 20 percent at Tiffany’s New York flagship store.
Tiffany’s combined U.S. internet and catalog sales climbed 17 percent. The company’s stores in Canada and Latin America also contributed to the overall sales boost.
Richemont’s Sales Climb
Luxury goods maker Compagnie Financiere Richemont SA noted better demand for its jewelry and watch products after seeing modest growth in the Christmas 2009 quarter. Group sales rose to $2.3 billion (EUR 1.6 billion) during the three months that ended on December 31, 2009, compared with $2.2 billion (EUR 1.5 billion) one year ago. The increase was 2 percent at actual exchange rates and 7 percent at constant exchange rates, which omit the effects of currency fluctuations.
Sales across Richemont’s jewelry maisons, which include Cartier and Van Cleef & Arpels, were up 5 percent to $1.2 billion (EUR 837 million) during the quarter. Cartier reported growth in both retail and wholesale sales, while Van Cleef & Arpels performed well at retail during the period, the company stated. Sales at Richemont’s watchmakers rose 3 percent to $587.8 million (EUR 417 million).
The retailer’s sales growth was strongest in the Asia-Pacific region, which recorded an increase of 25 percent to $693.5 million (EUR 492 million), while all other regions experienced declines.
Signet’s Holiday Sales Increase
Signet Group’s total sales rose 7.3 percent on a reported basis during the 2009 Christmas season compared with 2008, according to a sales update from the company. The group’s same-store sales gained by 5.6 percent.
Signet’s same-store sales in the U.S. jumped 7.6 percent during the nine-week Christmas shopping period, while its total sales increased by 7 percent. However, the retailer’s average selling price decreased approximately 9 percent at its mall-brand stores and by approximately 4 percent at its Jared the Galleria of Jewelry stores. Differentiated merchandise, such as Open Hearts by Jane Seymour, Love’s Embrace, the Leo Diamond and LeVian, were very successful, according to the update.
Signet’s sales rose by 8.6 percent at its U.K. stores on a reported basis. The retailer recorded strong diamond and charm bracelet sales at its H. Samuel stores in the U.K., as well as strong prestige watch and charm bracelet sales at its Ernest Jones stores in the U.K.
Birks & Mayors’ Sales Boosted by Exchange Rates
Birks & Mayors’ holiday season sales rose 6 percent compared with 2008 to $69.7 million, the jewelry retailer reported. The company noted, however, that its net sales growth reflected a $5.5 million benefit from currency exchange differences between the Canadian and U.S. dollars. Comparable-store sales in the U.S. fell 6 percent during the November through December 2009 period, while in Canada, they increased by 6 percent.
Department Store Sales Mixed
U.S. department store sales declined 1.2 percent year over year to $15.7 billion in December, according to data provided by the U.S. Department of Commerce. Overall retail sector sales, though, including food services sales, increased by 5.4 percent over their December 2008 levels to $353 billion.
A separate report compiled by the National Retail Federation (NRF) noted that U.S. retail sales rose 1.1 percent to $446.8 billion for November and December 2009 combined. The International Council of Shopping Centers (ICSC) determined that across all chain stores in the U.S., comparable-store sales increased 1.8 percent for the November and December period.
December sales at Macy’s totaled $4.4 billion for the five weeks that ended on January 2, 2010, which marked an increase of 0.7 percent over the same five weeks of 2008. The retailer’s same-store sales rose 1 percent. J.C. Penney’s sales fell 2.4 percent to $2.9 billion for the five weeks that ended on January 2, 2010, while its comparable-store sales decreased 3.8 percent.
Saks reported sales of $354.4 million for the five weeks that ended on January 2, which represented an 11.1 percent improvement over 2008. Comparable-store sales grew 9.9 percent during the period. Fine jewelry was among the weakest categories at Saks Fifth Avenue stores for the period.
Neiman Marcus’ revenue rose 6 percent during the five weeks that ended on January 2, 2010 to $556 million, while its comparable-store sales were up by 4.5 percent to $548 million. Precious jewelry was cited as one of the merchandise categories with the strongest performances at Neiman’s specialty stores.
Nordstrom reported preliminary total sales of $1.3 billion for the five weeks that ended on January 2, a 10.8 percent gain compared with December 2008. Same-store sales increased 7.4 percent.
Article from the Rapaport Magazine - February 2010. To subscribe click here.