Post-Christmas sales disappoint

Published: Thursday, January 5, 2006 at 6:01 a.m.
Last Modified: Thursday, January 5, 2006 at 12:00 a.m.
NEW YORK - While the nation's retailers didn't get their hoped-for sales blitz the week after Christmas, they're still expected to generally meet their modest holiday sales forecasts.
According to the International Council of Shopping Centers-UBS sales tally released Wednesday, sales slipped 0.8 percent for the week ended Saturday compared to the prior week and rose 2.9 percent compared to the same year-ago period.
The tally is based on same-store sales, or sales at stores opened at least a year, which are considered the best measure of a retailer health.
Michael P. Niemira, chief economist at the International Council of Shopping Centers, said that Dec. 26, the day after Christmas, was very strong, but sales deteriorated after that.
Still, Niemira noted that same-store sales for December and for the November-December period are still on track to meet a modest growth forecast of 3 percent to 3.5 percent.
According to ShopperTrak RCT Corp., which tracks retail sales at more than 40,000 mall-based stores, sales slipped 2.0 percent for the week ended Saturday compared to the same period a year ago. But the company said overall sales in December met its forecast for a 4.2 percent increase.
Meanwhile, the Johnson Redbook Retail Sales Index, which monitors same-store sales of 9,000 retail units, reported that sales rose 2.6 percent for the final week of December compared to the same year-ago period, resulting in a 3.4 percent gain for the month. That was slightly below the 3.8 percent forecast.
According to Catlin Levis, an analyst at Redbook Research Inc.,"many shoppers held on to their gift cards for later use."
Stores are counting on customers to redeem gift cards quickly in the weeks after Christmas to prop up profits and sales for the fourth quarter, which ends in late January. Gift card sales are only recorded when they are redeemed, so many stores made a big push to bring in new merchandise, hoping customers will buy regular-priced items.
Booming holiday gift card sales raised hopes that more cards than expected would be redeemed during the week after Christmas, which could have helped boost December sales. But that apparently didn't happen, and that means merchants will have to rely more on January to preserve profits and bolster sales.
Niemira estimated that 40 percent of holiday gift card redemption took place in January last year.
The nation's retailers are to report final same-store sales results on Thursday.

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