New York – The major retailers of home textiles have now reported their first quarter results and filed their 10-Qs with the SEC.
This easy-to-scan review provides insight into their home business. The compilation consists of companies that broke out home segment performance on their quarterly SEC filings and/or those who shared perspective on home performance during their quarterly review calls with analysts.
The condensed report has 3 components:
- Commentary on home trends and break-out sales numbers, where available
- A quick list of common trends cited by retailers
- A look at which retailers issued guidance for the fist time, raised guidance or lowered their guidance for the year after Q1 closed.
HOME BUSINESS PERFORMANCE
Big Lots
Soft home comp declined 11% during a quarter during which same-store sales fell in every product category. The company is working to drive more traffic by achieving 75% bargain penetration by the end of the year, including 50% extreme bargain penetration. It is positioning itself as “America’s Discount Home Store.”
Dillard’s
Sales in the Home & Furniture segment slipped 2.1% to $46.5 million. On a comp basis, the segment was neither among the strongest performing areas of the store (cosmetics came out on top) nor the weakest (men’s apparel and accessories). Gross margin increased moderately in both home and furniture during the quarter.
Dollar General
Total home segment sales fell 10% to $478.8 million. Inventory in the home segment was down 6%. The only other category with a sales decline was apparel, down 2%.
Family Dollar
Home product sales fell 5.1% to $227.2 million. Parent company Dollar Tree Inc. announced that it was seeking a buyer for the chain. During Q1, the company during closed approximately 550 Family Dollar stores as part of the portfolio optimization and expects to close an additional 150 stores by the end of fiscal 2024.
HomeGoods
Net sales were up 6% to $2.1 billion. Same-store sales rose 4% compared to a 7% decline in the year-ago quarter. Segment profit margin grew significantly, up 9.5%.
Kohl’s
Home segment sales fell 9.4% to $392 million. Seasonal and everyday décor sales jumped 30%, as did sales in gifts. Still, home underperformed the store’s 4.4% comp decline.
Macy’s Inc.
Sales in the consolidated Home + Other segment (which includes restaurant sales, allowance for merchandise returns adjustments and breakage income from unredeemed gift cards) dropped 17.6% to $650 million.
Marmaxx
While the apparel and home segments each generated growth, home outperformed during the quarter. Net sales for Marmaxx rose 5% to $7.75 billion, with comp up 2% on top of a 5% increase in the year-ago quarter.
Pottery Barn
Sales fell 12% to $677 million. Comps dropped 10.8% on top of a 0.2% decline in the year-ago quarter.
Pottery Barn Kids and Teen
Sales rose 2.8% to $222 million. Comp rose 2.8% on top of a 3.3% decline in the year-ago quarter.
Ross Stores Inc.
Sales in the Home Accents and Bed and Bath segment rose 8.0% to $1.26 billion. Home outperformed the company and accounted for 26% of sales.
Sam’s Club
The Home and Apparel segment saw a comp decrease in the low single-digit range. The warehouse club pointed to softness in seasonal and furniture, partially offset by strength in apparel and auto.
Target
Sales in the Home Furnishings & Décor segment fell 9.7% to $3.52 billion. Although Target saw continuing improvement in discretionary business, home remained soft. During Q1, Target reduced prices in select home categories, which drove up unit sales.
Walmart U.S.
Home benefitted as the general merchandise segment generated Q1 increases in units, traffic and share. On Walmart Marketplace, home was booming – up 20% for the quarter. Combining stores, first-party e-commerce and Walmart Marketplace, Walmart U.S. generated share gains in home.
West Elm
Sales fell 4.9% to $677 million. Comp decline 4.1% on top of a 15.8% drop in the year-ago quarter.
THROUGH LINES
Consumers remain selective in their purchase of discretionary goods.
Lower-income consumers are especially pressured by food inflation and cost of living such a housing and fuel prices.
Business got off to a slow start at the beginning of the quarter.
Business was impacted by the timing of tax refunds.
Business was impacted by heavy weather earlier in the quarter.
Retailers were generally more optimistic about their bottom-line forecasts than their top-line outlook for the year.
GUIDANCE
Macy’s Inc.
Macy’s Inc. revised its full-year guidance, raising expectations for adjusted earnings per share to a range of $2.55-$2.90 from previous guidance of $2.45-$2.85. It also narrowed the range for full year net sales, which are now expected to land between $22.3 billion and $22.9 billion. Originally, Macy’s Inc. forecast net sales of $22.2 billion to $22.9 billion.
Kohl’s
Kohl’s lowered its guidance. The company now expects full-year net sales to decline between 2% to 4%, versus an earlier forecast in the range of a 1% decline and a 1% increase. Kohl’s annual EPS has been readjusted to a range of $1.25 to $1.85 versus previous guidance of $2.10 to $2.70
Ross Stores Inc.
Ross raised its profit guidance for the full fiscal year and now expects earnings per share in the range of $5.79 to $5.98 versus the $5.56 EPS its generated last year. Guidance for full-year comp remains unchanged at up 2% to 3%.
TJX
TJX Cos. increased its full fiscal year guidance for pretax profit margin to be in the range of 11.0% to 11.1% and increased its diluted earnings per share outlook to be in the range of $4.03 to $4.09. The company continues to plan consolidated comparable store sales to be up 2% to 3%.
Walmart Inc.
Walmart Inc. now expects full-year results to hit the high end of its previous guidance, or perhaps even top it. The forecast calls for net sales growth of 3% to 4% and adjusted EPS between $2.23 and $2.37.
Williams-Sonoma Inc.
For the fiscal year, Williams-Sonoma is maintaining its guidance of annual net revenue growth in the range of -3% to +3%, with comps in the range of -4.5% to +1.5%, while raising guidance on operating margin between 17.6% to 18.0%.