July Catalog Sales Evaporate

Stamford, CT–July catalog sales for the publicly-traded cataloger/retailers tracked by Catalog Age melted away like a toddler’s ice cream cone in the summer heat.

Downers Grove, IL-based Spiegel Group, which mails the Eddie Bauer, Newport News, and Spiegel catalogs, said total company sales fell 13%, to $139.1 million for the four weeks ended July 27, compared with $160.0 million last year. Total direct sales declined 19% and the group’s retail store sales decreased 6%. Web sales inched up 1% for the month.

By division, July sales fell 2% at Eddie Bauer, 15% at Newport News, and 33% at Spiegel catalog. The company said in a statement that the Spiegel catalog and Newport News “continue to be restrained by more stringent credit-granting measures taken in the company’s private-label credit card business. While these measures are negatively impacting sales near-term, they are an integral part of strategies aimed at attracting and retaining higher-quality credit customers and building stronger long-term customer relationships.”

Meanwhile, Plano, TX-based cataloger/retailer J.C. Penney (NYSE: JCP) continues to struggle as well. Catalog sales decreased 23%, to $160 million from $209 million, thanks to continued weakness in consumer demand. Total Penney sales fell O.6%, to $2.1 billion from $2.2 billion last year. According to Penney, sales were soft during the month due to low levels of inventory resulting from stronger than planned sales during the first quarter.

Dallas-based The Neiman Marcus Group, (NYSE: NMG.A) was not without its challenges. Sales at the Neiman Marcus Direct unit, which includes the Neiman Marcus, Horchow, and Chef’s Catalog , declined 2% in July. Total company revenue fell 3%, to $165 million, from $170 million last year. In the four-week period in July, comparable revenue in the Specialty Retail Stores segment, which includes Neiman Marcus stores and Bergdorf Goodman, decreased 7%.

“The fourth quarter sales results reflected an improvement in our full-price selling offset by a reduction in off-price selling,” said Burton M. Tansky, president/CEO in a statement. “The key to both of these trends was that we entered the fourth quarter with our inventory in excellent shape. The quality of our inventory allowed us to increase our focus on our core customer and simultaneously reduce our promotional efforts. As a result, despite overall lower sales levels, we anticipate a significant improvement in fourth quarter gross margin compared to last year.”

Even the usually reliable marketer of classic women’s apparel The Talbots (NYSE: TLB) reported lackluster results. Company sales decreased 11%, to $94.5 million from $106.6 million last year. For the quarter, the Hingham, MA-based cataloger/retailer said catalog sales decreased 5% to $47.4 million from $49.8 million, due to a planned lower circulation. Talbots did not break out monthly catalog sales. Comparable store sales decreased 19.0% for the month due to significantly lower levels of markdown inventory.

The quarter was not without its success stories. San Francisco-based gadgets marketer Sharper Image (Nasdaq: SHRP) said catalog sales increased a whopping 67%, to $9.8 million from last July’s $5.9 million. In a release, Sharper Image said the wholesale sales component of the catalog division were strong in July, with tests of several new proprietary products by Sharper Image Design contributing to the sales increase. What’s more, the sale increases came without significant promotions at improved gross margins. Sharper Image’s Web sales, including auction sales, increased 25 % to $3.5 million from last July’s $2.8 million. Total company sales for the month of July increased 35% to $31.2 million from last July’s $23.2 million. Total store sales increased 23% to $17.9 million from $14.6 million; comparable store sales increased 9%.

Finally, newly united Columbus, OH-based Limited Brands (NYSE: LTD), which owns Victoria’s Secret, Bath & Body Works, Express, Express Men’s (Structure), Lerner New York, Limited Stores, White Barn Candle Co., and Henri Bendel, reported that Victoria’s Secret Direct, the catalog and Internet division of the apparel/lingerie brand increased 9%, to $249.2 million compared with $229.1 million last year. Net sales were $582.9 million, an increase of 6% compared to adjusted sales of $548.5 million last year.

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