Large retailers continued to ring up sales in 2005, gaining 5.9% compared to 2004, Statistics Canada said today.

The increase was slightly off the 6.4% gain in 2004, but fairly close to the average growth rate over the last five years. The group of large retailers saw sales rise in all major commodity groups for 2005, with increases ranging from 2.7% to 8.5%.

In December, sales increased 1.4% from a month earlier to $8.4 billion. After three quarters of moderate to strong growth, fourth quarter sales were up a slight 0.6%. This was the smallest quarterly increase at large retailers since the fourth quarter of 2004. Despite the recent slowing, sales at large retailers had been generally rising throughout 2005. In 2004, sales increased rapidly until the fall, before posting softer growth in the final few months of the year.

Surging fuel and energy prices may have had consumers hesitating to spend in Q4 2005, StatsCan said.

Food and beverage sales posted the strongest annual sales growth at large retailers in 2005, with an increase of 8.5%. Food prices were up 2.3% in 2005, the largest price change in the past three years, which may have accounted for some of the 8.2% increase in food sales. Beverage sales were particularly strong, with non-alcoholic beverages up 11.4% and alcoholic beverage sales up 16.4% at large retailers compared to 2004.

The other goods and services category posted the second strongest increase in 2005, gaining 7.4%. Automotive fuel, oil and additive sales gained 25.0% at large retailers, driven up in part by a 12.8% rise in the price of gasoline. Pet food sales were another mover in this category, increasing 10.0% compared to 2004. Tobacco sales, which account for about one-fifth of the sales in this category, dampened sales growth somewhat with a slight 0.9% increase. Sales of tobacco have grown at a rate slower than its annual price increase for the past several years at large retailers.