Retail sales up 0.4% in October
Advance estimates for retail and food service sales came in at $428.1 billion for the month of October, a larger-than-expected increase of 0.4%, the U.S. Census Bureau reported. September sales also enjoyed an upwardly revised boost from -0.1% to an increase of 0.5%.
Retail trade sales largely mirrored that of total retail and food service sales, both of which were up 3.9% over last year.
Adjusted totals for building material and garden equipment & supplies dealers (NAICS 444) were $25.8 billion, a 1.9% decrease since September. However, the figures maintain an edge over October 2012 by a margin of 4.2%.
Auto and other motor vehicle dealers realized the largest year-over-year improvement at 11.9%, with nonstore retailers close behind at 8.2%.
Many economists expected sales to flatline or decline in October due to the steep drop in consumer confidence caused by the government shutdown. The relatively optimistic report suggests that holiday sales may be higher than expected this year, though Gallup just issued a rather uninspired forecast.
Valspar finishes strong in fiscal 2013
Valspar reported fourth-quarter net sales of $1.1 billion, up 8% versus the prior year.
Fourth-quarter 2013 adjusted net income was $86 million, compared with $80 million a year ago.
"The fourth quarter was a good finish to the year as growth in both sales and operating income improved from previous quarters. Sales growth was led by strong performance in our U.S. Consumer, Wood and Coil product lines and by the acquisition of Inver,” said Gary E. Hendrickson, chairman and CEO. “We saw the benefit of new business wins in all product lines. These wins were partially offset by weakness in certain end markets and international regions, as has been the case throughout 2013.”
For the full year, the company reported sales of $4.1 billion, up 2%. Fiscal year 2013 adjusted net income was $320 million, compared with $310 million a year ago.
Looking ahead to fiscal 2014, Hendrickson said, “We expect stronger sales and earnings growth through continued new business, benefits from acquisitions, a stable U.S. market and through our productivity initiatives."
The company expects sales to increase 7% to 9% in fiscal 2014.
Menear recounts Depot’s top sellers
What categories did well at Home Depot in the third quarter? Take your pick.
All merchandise departments posted positive comps, Craig Menear told analysts during yesterday’s earnings call. Even those that fell below the company average — millwork, flooring, pluming, outdoor garden, building materials, hardware and tools — still performed positively.
"Strength in the core of the store, the continued resurgence of our pro customers and mild temperatures helped us overcome difficult comparisons cycling last year’s storm-related sales," Menear said.
Receiving special mention for third-quarter performance was the company’s enhanced appliance showroom plan, a reset that began last year and is yielding double-digit growth for appliances both in-store and online. The plan involves localized assortments in 400 stores that showcase an expanded assortment.
Home Depot executives were happy to report gains with pro customers. Menear pointed to double-digit comps in the following categories: gypsum, concrete, pressure treated lumber and mouldings.
Total transactions in the quarter grew by 4%, he said. Average ticket increased 3.2%
The numbers also show customers digging deeper into their pockets. Transactions for tickets over $900 were up 10.3% in the quarter. That growth was credited to strength in pro sales, appliances, HVAC, countertops and in-stock kitchens, Menear said.
Across the store in the third quarter, the following categories were selling at above-average pace: kitchens, lighting, decor, lumber, electrical, indoor garden, paint and bath.
In the fourth quarter, Home Depot has high expectations for its Nest Protect smoke and carbon monoxide detector, Menear said. The stores will also promote the Kevo BlueTooth Deadbolt from Kwikset and True White LED bulbs from Cree.