SYDNEY (MarketWatch) — U.S. retail sales have improved “enormously” and a benign trading environment in Australia is showing signs of life, executives from global shopping mall giant Westfield Group (WDC.AU) said Wednesday.
High unemployment continues to buffet U.S. consumer confidence and in Australia consumers are jittery about higher interest rates designed to cool the country’s booming mining sector.
Sustained growth in retail sales would be a good sign for the U.S., given that American consumers account for about 70% of its economic activity. In Australia, improved sales could cool concerns that higher interest rates and the strong Australian dollar’s impact on local manufacturers are threatening the resource-rich economy’s good health.
Westfield said sales for the combined months of March and April from specialty stores in its 55 U.S. malls rose 7% from the same period a year earlier. That compares to 5.4% growth for the three months to March 31 reported by Westfield just two weeks ago.
Official U.S. census data shows April retail sales in the world’s biggest economy grew 7.6% from a year earlier and 0.5% from March. That increase, however, was smaller than the 0.9% jump a month earlier indicating that consumer confidence is still sensitive to shocks, such as higher gasoline and food prices.
There is “definitely a recovery in process” in the U.S., Westfield Joint Chief Executive Peter Lowy told reporters. “The retail industry is recovering, the economy is recovering,” he said.
Sales from specialty stores in Westfield’s Australian malls rose 4.4% in March and April, compared to 1.1% growth in the first quarter.
“There seems to be an improving trend and Easter seemed to be a good period for the retailers,” Joint Chief Executive Steven Lowy said.
Westfield in December spun a half share of its Australian and New Zealand malls into a separately listed fund. It’s considering selling some U.S. assets, potentially into joint ventures, and using the proceeds to build malls in new markets that could include Asia and mainland Europe.
Peter Lowy reiterated that a large amount of investment capital in the U.S. is searching for a home, but wouldn’t comment on the progress of specific asset sales. In a sign liquidity is returning to the market, Lend Lease Group (LLC.AU) this week sold its 50% interest in the King of Prussia mall in Philadelphia for US$545 million, booking a US$100 million profit on the sale.
Westfield on Wednesday stuck to its annual profit guidance as the negative impact of a strong Australian dollar on offshore earnings is offset by lower interest rates in the U.S.
The company has no plans to report in a different currency, Chairman Frank Lowy said. “A decision to change currency would be a very big one, but if necessary we will consider it,” he said.
The strong Australian dollar is making offshore goods sold online more attractive to local shoppers, prompting Westfield to recently set up its own online shopping service.
“It’s clearly a threat from a competitive perspective but it also provides an opportunity, which we’ve put our toe in the water for,” Steven Lowy said.
Westfield upbeat on U.S., Australia retail sales
SYDNEY (MarketWatch) — U.S. retail sales have improved “enormously” and a benign trading environment in Australia is showing signs of life, executives from global shopping mall giant Westfield Group (WDC.AU) said Wednesday.
High unemployment continues to buffet U.S. consumer confidence and in Australia consumers are jittery about higher interest rates designed to cool the country’s booming mining sector.
Sustained growth in retail sales would be a good sign for the U.S., given that American consumers account for about 70% of its economic activity. In Australia, improved sales could cool concerns that higher interest rates and the strong Australian dollar’s impact on local manufacturers are threatening the resource-rich economy’s good health.
Westfield said sales for the combined months of March and April from specialty stores in its 55 U.S. malls rose 7% from the same period a year earlier. That compares to 5.4% growth for the three months to March 31 reported by Westfield just two weeks ago.
Official U.S. census data shows April retail sales in the world’s biggest economy grew 7.6% from a year earlier and 0.5% from March. That increase, however, was smaller than the 0.9% jump a month earlier indicating that consumer confidence is still sensitive to shocks, such as higher gasoline and food prices.
There is “definitely a recovery in process” in the U.S., Westfield Joint Chief Executive Peter Lowy told reporters. “The retail industry is recovering, the economy is recovering,” he said.
Sales from specialty stores in Westfield’s Australian malls rose 4.4% in March and April, compared to 1.1% growth in the first quarter.
“There seems to be an improving trend and Easter seemed to be a good period for the retailers,” Joint Chief Executive Steven Lowy said.
Westfield in December spun a half share of its Australian and New Zealand malls into a separately listed fund. It’s considering selling some U.S. assets, potentially into joint ventures, and using the proceeds to build malls in new markets that could include Asia and mainland Europe.
Peter Lowy reiterated that a large amount of investment capital in the U.S. is searching for a home, but wouldn’t comment on the progress of specific asset sales. In a sign liquidity is returning to the market, Lend Lease Group (LLC.AU) this week sold its 50% interest in the King of Prussia mall in Philadelphia for US$545 million, booking a US$100 million profit on the sale.
Westfield on Wednesday stuck to its annual profit guidance as the negative impact of a strong Australian dollar on offshore earnings is offset by lower interest rates in the U.S.
The company has no plans to report in a different currency, Chairman Frank Lowy said. “A decision to change currency would be a very big one, but if necessary we will consider it,” he said.
The strong Australian dollar is making offshore goods sold online more attractive to local shoppers, prompting Westfield to recently set up its own online shopping service.
“It’s clearly a threat from a competitive perspective but it also provides an opportunity, which we’ve put our toe in the water for,” Steven Lowy said.
http://www.marketwatch.com/story/westfield-upbeat-on-us-australia-retail-sales-2011-05-25?reflink=MW_news_stmp
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