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Luxury Loses Steam as December Comps Fall

Amid fears of a recession, the U.S. luxury juggernaut is showing signs of slowing as December same-store sales declined 5.4 percent on average for the department store sector.

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Amid fears of a recession, the U.S. luxury juggernaut is showing signs of slowing as December same-store sales declined 5.4 percent on average for the department store sector, and total sales for the channel shed 6.5 percent year over year.

Nordstrom reported a 4 percent decline in same-store sales, slightly lower than consensus estimates. Saks, up against difficult comparisons last year and over the last few months, reported a 0.8 percent gain. However, Saks beat expectations of a 1.5 percent decline. Macy’s fell 7.9 percent and Neiman Marcus reported a 2.9 percent increase in December same-store sales. The store had been reporting comparable-store sales between 4 and 8 percent over the last six months.

Moderate department stores also fell. J.C. Penney and Kohl’s declined 7.5 and 0.7 percent, respectively.

As anticipated, most retailers reported comps for December that declined or missed expectations. Twenty-seven of the 40 retailers tracked by WWD reported negative same-store sales for the month.

The mass merchant sector was the exception, with all but one retailer — Stein Mart — posting positive same-store sales. Overall, the sector posted a 1.1 percent increase. Wal-Mart reported a 2.6 percent boost, beating expectations. After revising its estimates mid-month, Target was on plan with a 5 percent decrease.

The specialty sector dropped 3 percent. Only a handful of retailers were on the positive side. Aeropostale and Buckle were among those defying the sector trend. They reported comps growth of 12.2 percent and 18.7 percent, respectively.

The department store sector took the biggest hit, declining 6.3 percent overall.

For more, see Friday’s issue of WWD.