Retail sales rose 7% in November to boost ASX retail shares

Retail sales improved 7.1% in November as Melbourne trade resumed, post-lockdown. Here's a closer look at the breakdown and which ASX retail shares saw a boost.

| More on:
woman in trolley representing rising retail share price

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Australian retail turnover rose 7.1% in November 2020, seasonally adjusted, according to the latest Australian Bureau of Statistics (ABS) Retail Trade figures.   

The rise was led by Victoria, which saw its retail sales surge by 22.4% as Melbourne retail stores were able to trade for a full month in November. Excluding Victoria, turnover increased 2.6%. 

ASX retail shares have largely reported upbeat earnings, especially in the months of November and December. Here are the industries and ASX retail shares that have benefitted from improved retail conditions. 

Industry level breakdown 

At the industry level, clothing, footwear and personal accessory retailing jumped by 26.7%. 

Coinciding with the strong performance for this segment, Accent Group (ASX: AX1) released a trading update on 7 January 2021 citing stronger than expected sales in November and December. The company is now expecting group earnings before interest, tax, depreciation and amortisation (EBITDA) for the half year ended 27 December 2020 to be in the range of $95 million to $98 million, which represents a growth of between 40–45% on the prior corresponding period. 

Department stores also experienced a significant uplift in turnover with a 21.1% increase. This has helped the likes of Kmart and Target owner Wesfarmers Ltd (ASX: WES) hit all-time record highs on the back of strong earnings across the group's retail businesses.

Household goods retailing also improved 12.7%. Nick Scali Limited (ASX: NCK) recently updated its profit guidance following better than anticipated container availability during the months of November and December, which lead to increased delivery volumes. The company now expects unaudited net profit after tax for the six months to 31 December 2020 to be $40.5 million, up approximately 100% on the prior corresponding period.

Other household retailers such as Temple & Webster Group Ltd (ASX: TPW) and Adairs Ltd (ASX: ADH) have also experienced a recent resurgence in share price.

Elsewhere, cafes, restaurants and takeaway food services increased 6.7% while food retailing fell 0.3%. Total retail turnover rose 13.3% when compared to November 2019. 

E-commerce trend continues 

The growing dominance of e-commerce is also clear in these latest numbers. Online sales made up 11% of total retail turnover in November 2020, compared to 10.4% in October 2020, while in November 2019, online retail contributed 7.2% to total retail turnover. 

Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Temple & Webster Group Ltd. The Motley Fool Australia's parent company Motley Fool Holdings Inc. recommends ADAIRS FPO. The Motley Fool Australia owns shares of Wesfarmers Limited. The Motley Fool Australia has recommended Accent Group, ADAIRS FPO, and Temple & Webster Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Retail Shares

A businessman looking at his digital tablet or strategy planning in hotel conference lobby. He is happy at achieving financial goals.
Retail Shares

3 reasons this broker thinks Woolworths shares are a cheap buy

Is this supermarket giant being undervalued by the market?

Read more »

A woman sits on sofa pondering a question.
Retail Shares

ASX retail shares mixed amid modest April sales growth

What does the latest sales data mean for ASX retail shares?

Read more »

Man on a laptop thinking.
Broker Notes

Why did Goldman Sachs just downgrade Wesfarmers shares?

The ASX 200 conglomerate has had a ripper run of share price growth. So why is Goldman Sachs downgrading it?

Read more »

Woman checking out new iPads.
Retail Shares

Dump 'em! Top broker says sell these 3 ASX retail shares

This comes amid high interest rates, weak retail sales, and persistently negative consumer sentiment.

Read more »

A woman looks at a tablet device while in the aisles of a hardware style store amid stacked boxes on shelves representing Bunnings and the Wesfarmers share price
Retail Shares

What is the price target for Wesfarmers shares?

Is there further success coming for this retail giant?

Read more »

A laughing woman pushes her friend, who has her arms outstretched, in a supermarket trolley.
Retail Shares

Goldman says these 6 ASX retail shares are a buying opportunity

The latest retail trading data was historically weak, according to the Australian Bureau of Statistics.

Read more »

Woman checking out new laptops.
Retail Shares

Are JB Hi-Fi shares still a buy as growth slows?

Is this stock worth a bargain basket buy?

Read more »

Young people shopping in mall and having fun.

I'd buy these ASX retail shares if economic fragility starts a fire sale

An economic hiccup could present a golden opportunity to buy these quality retailers.

Read more »