NEW YORK — Last-minute holiday shoppers brought relief to the nation's retailers, handing them modest sales gains for the season and prompting several chains to raise their fourth-quarter profit outlooks.
The improved profit picture comes because retailers never had to resort to drastic price-cutting after keeping inventories lean.
Still, the solid finish capped a year that saw the biggest sales decline in at least four decades, according to the International Council of Shopping Centers. Merchants saw sales fall every month except September, October and December.
Retailers may be facing chilly months ahead as consumer spending is expected to remain muted amid high unemployment and tight credit, although the slowdown in job losses may help.
"The holiday season was decent but nothing you can get excited about. And it was saved by a last-minute surge," said Ken Perkins, president of research firm RetailMetrics. "Santa didn't deliver coal, but he certainly didn't deliver caviar."
The trend seemed to extend to Stanislaus County retailers, some of whom saw a modest uptick during the last part of the year.
Carla Ciccarelli, co-owner of Ciccarelli Jewelers near Modesto's Vintage Faire Mall, said holiday sales were "slightly ahead" of last year's.
Engagement rings saved the season, she said.
"Thank goodness people are in love and getting engaged," Ciccarelli said. "We're just glad to see that it's turning around a bit. With all the doom and gloom, it's nice to have something lighter to look at."
New and used video game retailer GameStop in Turlock's Monte Vista Crossings Shopping Center said it was "pleased" with its Christmas season.
"We were at and above last year. We did very well," said manager Michael Overholtzer, who noted that value-conscious shoppers may have been wooed by the used games and trade-ins.
But some retailers in Modesto's McHenry Village, including the stationery and gift store Paper Habit, said traffic in the outdoor shopping center seemed slower than last year. One said construction along McHenry Avenue and at the new CVS store in the center may have been to blame.
According to the shopping center council's sales index, December sales rose 2.8 percent compared with a year ago, ending a year that averaged a 2 percent drop. For November and December combined, the index rose 1.8 percent, better than its estimate for a 1 percent gain. That figure, however, compares with a 5.8 percent drop a year ago, the biggest holiday sales decline in at least four decades.
The sales figures are based on sales at stores open at least a year and are considered a key indicator of a retailer's health. The index doesn't include Wal-Mart Stores Inc., which no longer releases sales figures on a monthly basis.
The better-than-expected December reading was the strongest since April 2008, when stores collectively had a 3.3 percent gain, according to the shopping center council.
Several retailers, including Sears Holdings Corp. and TJX, saw their stocks soar in Thursday's trading. However, the Dow Jones U.S. Retail Index has been largely unchanged since Thanksgiving. For 2008, the retail index rose 27.8 percent, surpassing the 18.8 percent gain for the Dow Jones Industrial average.
As merchants reported results Thursday, warehouse club operator Costco Wholesale Corp., Target Corp., Macy's Inc. and TJX Cos. all reported increases. Luxury stores such as Saks Inc. and Nordstrom also saw strong December sales.
Even Sears Holdings Corp., which operates Kmart and Sears, Roebuck and Co., eked out a small gain and offered fourth-quarter guidance that's sharply above Wall Street estimates. Macy's Inc., Kohl's Corp. and Limited Brands are among retailers raising profit outlooks.
Stragglers included jewelry chain Zale Corp., which reported a sharp sales decline but said it maintained discipline in discounting. Teen retailer Abercrombie & Fitch struggled with continued double-digit sales drops.
Bookseller Barnes & Noble Inc. lowered its fiscal third-quarter guidance after holiday sales proved weaker than expected.
Perkins noted that stores will remain cautious about their outlooks for this year because "the consumer is still very strapped."
Retailers managed to avoid another Christmas catastrophe because they had a year to plan for a new consumer mind-set. They headed into the season with lower inventories and more practical merchandise that resonated with shoppers who stuck to their lists and researched deals online.