Retail sales up 0.3% in February
Advance estimates of U.S. retail and food services sales came in at $427.2 billion for the month of February, up 0.3% since January and 1.5% since February 2013.
The progress of retail trade sales matched those of the overall figure at 0.3%, with nonstore retailers up 6.3% year-over-year and health and personal care stores up 5.5% since last year.
Building materials and garden equipment and supplies dealers posted the next-strongest year-over-year recovery, with sales improving 3.2% since February 2013 and 0.3% since last month.
Some categories fared a bit worse on year-ago terms, including department stores (-4.8%), sporting goods, hobby, book and music stores (-5.2%), gasoline stations (-4.6%) and electronics and appliance stores (-2.4%).
Additionally, the overall December 2013 to January 2014 percent change was downwardly revised from -0.4% to -0.6%.
Williams-Sonoma posts strong Q4
Williams-Sonoma reported net revenues increased to $1.5 billion in the fourth quarter ended Feb. 2 from $1.4 billion in the prior-year quarter. This year’s fourth quarter had just 13 weeks compared with last year’s fourth quarter, which had 14; excluding the additional week in the prior-year quarter, net revenues grew 10%.
Net earnings totaled $133.8 million, up from $133.7 million in the prior-year fourth quarter.
Williams-Sonoma president and CEO Laura Alber credited the strength of the company’s brands across retail and e-commerce for its performance in the fourth quarter ended Feb. 2.
“Williams-Sonoma outperformed the retail industry this holiday season, gaining market share and demonstrating the structural advantage of our multi-brand, multi-channel platform,” said Alber. “We executed our strategic plan, investing in our brands and the supporting infrastructure to ensure sustainable long-term growth both domestically and around the world. The results speak for themselves: we delivered strong top and bottom line performance, which combined with over $350 million in share repurchases and dividends generated superior returns for our stockholders.”
Direct-to-customer (DTC) net revenues in the quarter increased to $706 million from $634 million in last year’s quarter. Excluding the additional week in the prior-year quarter, DTC net revenues grew 19%, primarily driven by Pottery Barn, Pottery Barn Kids, West Elm and Williams-Sonoma. DTC net revenues generated 48% of total company net revenues in the quarter, compared with 45% in prior-year quarter.
Retail net revenues in the quarter were $760 million versus $773 million in the prior-year quarter. Excluding the additional week in last year’s fourth quarter, retail net revenues grew 2.7%, primarily driven by Pottery Barn and West Elm, partially offset by a decrease in Williams-Sonoma and the company’s international franchise operations.
NRF pushes for online sales tax
The National Retail Federation (NRF) is urging Congress to pass legislation that would require online and remote sellers to collect state and local sales taxes, telling a House committee that lawmakers should level the playing field between local retailers and out-of-state competitors.
David French, SVP of the NRF, told the House Judiciary Committee in a letter that legislation is needed to end the sales tax disparity.
While brick-and-mortar merchants are required to collect state and local sales taxes on most items, many out-of-state sellers are not required to do so, giving them what the NRF says is an unfair price and market advantage of as much as 10%. The committee is scheduled to hold a hearing on the issue Wednesday, March 12.
NRF urged the committee to consider online sales tax legislation, based on principles outlined last fall by Chairman Bob Goodlatte, R-Va., that recognizes compliance costs, eliminates the current patchwork of state laws and court decisions, and simplifies the collection process. Under the U.S. Supreme Court’s 1992 Quill ruling, online retailers are required to collect sales tax only in states where they have a physical presence such as a headquarters, store, office or warehouse. Federal legislation passed in the Senate last year would provide states the ability to require sales tax collection.
“Members of the National Retail Federation believe that Congress must resolve the constitutional questions posed by the Quill decision in a fashion which promotes a level playing field between retail competitors,” French said. “As retailing evolves and Internet sales become a more prominent portion of total retail sales, it is critical that Congress address the sales tax collection discrimination that exists between brick-and-mortar and remote retailers.”