Luxury Retailer Woes Continue

In the past couple of days over 30 retailers have reported monthly sales data for May, and the results weren’t pretty. Sales were weaker than expected at 19 of 30 retailers tracked by Thomson Reuters, with a composite same-store sales decline of 4.8% vs. a consensus estimate of 4.1%. Results were disappointing at both the low and high-end, but upscale/luxury retailers continued to post the worst declines.

As Ken Perkins, president of Retail Metrics put it, “The high end continues to struggle, those in the discretionary spend segment are really continuing to get clocked.”

• Saks (SKS) posted a decline of 25.8% in net sales and a 26.6% decrease in overall same-store sales compared to the prior period. They have now reported 11 consecutive months of negative same-store sales results.
• Neiman Marcus reported a decline of 21.5% in net sales and a 23.3% decrease in overall same-store sales compared to the prior period, marking their 12th consecutive month of negative same-store sales results.
• Nordstrom (JWN) reported a decline of 8.7% in net sales and a 13.1% decrease in same-store sales compared to the prior period. They have now reported 12 consecutive months and 6 consecutive quarters of negative same-store sales results.

While the sector was rocking along during the bubble-induced spending days and held up relatively well last year, it seems they fell off a cliff after the Lehman bankruptcy and show no signs whatsoever of any stabilization:

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