Concerns over the health of bricks and mortar retailing in the US intensified on Tuesday as three of the country’s biggest department store chains, Nordstrom, Kohl’s and JC Penney, posted falling sales that sent their share prices tumbling.

Quarterly results fell short of forecasts at all three companies, which between them operate more than 2,300 stores and employ almost 300,000 people. Kohl’s stock closed down 12 per cent and JC Penney 7 per cent. Nordstrom dropped almost 9 per cent in trading after the bell.

Despite robust consumer spending, US retailers are being squeezed by falling mall traffic, increasing labour and transport costs, the rise of online shopping and a shift by consumers towards spending more on recreation and travel.

After the market closed, the upscale Nordstrom chain disclosed a 3.5 per cent decline in net sales from a year ago to $3.35bn. The Seattle-based group warned of a broad-based decline at both its full price and discount businesses, online as well as in stores.

Erik Nordstrom, co-president, said the company had “experienced a further deceleration” in its fiscal first quarter from the previous quarter. Net earnings dropped from $87m a year ago to $37m.

Wall Street was already concerned by an unexpected sales decline at Kohl’s. Alongside its earnings on Tuesday morning, Kohl’s issued a profit warning for the full year.

Kohl’s executives said that bad weather, in particular unseasonal cold in the Wisconsin-based company’s Midwest and north-east heartlands, had exacerbated the same-store sales decline in its first quarter, down 3.4 per cent from a year ago.

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Yet there were also some signs that the chain’s difficulties were self-inflicted. Michelle Gass, chief executive, said problems in marketing and homewares had contributed to the slower performance.

“Some of our key promotional events weren’t as productive,” she acknowledged, while “there were points in time during the quarter where we just weren’t as competitive” in homewares.

Ms Gass added that Kohl’s had “adjustments under way to get us back on track”. The chain has a partnership with Amazon to allow customers to return items purchased from the ecommerce giant at its stores.

At JC Penney, relative strength in fine jewellery and clothing failed to offset declines in women’s accessories and handbags, among other goods. Net losses in its fiscal first quarter widened from $78m last time to $154m, while net sales fell 5.6 per cent to $2.4bn.

The latest earnings weakness adds to pressure on the Texas-based chain, which carries $3.8bn in long-term debt and whose market capitalisation has collapsed from highs in 2007 of $18.5bn to just $330m.

“Re-establishing the fundamentals of our business operations will take time,” said Jill Soltau, chief executive.

The department store results on Tuesday are the latest in a batch of mixed earnings reports from consumer-facing companies.

Groceries helped Walmart last week report its strongest first-quarter sales in nine years. Macy’s also eked out a sales improvement, saying that the weather had no impact on sales. Results from other retailers, including Target and Best Buy, are scheduled for release in coming days.

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Kohl’s warned that adjusted earnings for the current year are now expected to come in at between $5.15 and $5.45 a share, down from its previous guidance of $5.80 to $6.15. Bruce Besanko, chief financial officer, said pressures included higher trade tariffs, which “we just didn’t have baked into our outlook”.

For the first quarter, Kohl’s revenue was 2.9 per cent lower at $4.08bn. Net income fell 8 per cent to $98m, below the $109m that analysts had forecast.

Via Financial Times