||Mild Winter Cheers Retailers
U.S. retailers turned in solid sales for February as warmer weather brought out shoppers for spring wear and clearance sales.
Stores began displaying spring apparel during the month -- in many cases with bright colors offering some freshness. Analysts said some shoppers used money they didn't spend on apparel for a frigid winter that didn't come.
"It is easier to consider purchasing tanks and dresses when it is snowless and 50 degrees out," said Howard Tubin, retail analyst at RBC Capital Markets.
The 18 retailers that report same-store sales, or sales at stores open more than a year, showed 6.4% growth in February, when 4.8% was expected, according to Thomson Reuters. The figure compares with 4.7% a year ago.
The three-day Presidents Day weekend and Valentine's Day drew some extra buying. The National Retail Federation said the average person celebrating Valentine's Day spent $126.03, up 8.5% from last year's $116.21, and the highest in the survey's 10-year history. Last year, shopping over these holidays was constrained by more severe weather. Total spending for Valentine's Day this year was expected to reach $17.6 billion compared with $15.7 billion last year.
For February, Target Corp.'s same-store sales rose 7% when 5.2% was projected. "February sales were well above our expectations, due to stronger-than-expected (customer) traffic combined with a solid increase in transaction size," said Chief Executive Gregg Steinhafel.
Macy's Inc. reported a 4.6% rise in comparable-store sales, when 3.5% was expected. "Our fiscal 2012 is off to a good start with February sales that exceeded our expectations," Chief Executive Terry Lundgren said. The retailer saw good response to early spring merchandise in women's apparel, and continued strong trends in accessories, shoes, cosmetics, men's and home, "which bodes well for the months ahead," Mr. Lundgren said.
Fellow department store Kohl's Corp. posted a 0.8% drop in same-store sales, when flat sales were expected. Kohl's had said when it reported fourth-quarter earnings that it expected February to be slightly below first-quarter guidance that called for a same-store rise of 1%.
Wal-Mart Stores Inc. doesn't report monthly sales but on Thursday of last week the retailer said its board approved a roughly 9% increase in its annual dividend, and expressed high expectations for the year ahead. The world's largest retailer now will pay shareholders $1.59 a share, up from the $1.46-a-share before. The increased distribution will cost the company roughly an added $447.5 million a year.
Gap Inc. posted a 4% rise in same-store sales compared to a 3% decrease a year ago and expectations for a 1.4% drop. All units except international showed sales growth. Customers "responded well to our spring product," Chief Executive Glenn Murphy said. Backing out the effects from the Easter shifts in the calendar, the 4% rise was Gap's best since 2004.
TJX Cos. reported a 9% rise in same-store sales when a 7% gain was expected. "We believe that very favorable weather patterns during the month helped boost demand for spring apparel," said Chief Executive Carol Meyrowitz, adding that customer traffic rose at all divisions.
On the higher end, Nordstrom Inc. reported same-store sales rose 10.2%, significantly topping expectations for a 5.6% increase. Nordstrom said the month included a shift in the timing of a shoe-clearance sale relative to last year. The event improved total February same-store sales by about 200 to 250 basis points and will reduce total March same-store sales by roughly 150 to 200 basis points. Saks Inc. said same-store sales increased 6.6%, when analysts projected 5.5%. The strongest categories included women's and men's contemporary apparel, handbags, and men's accessories, shoes, and furnishings.
Limited Brands Inc., which benefits from Valentine's Day, reported an 8% rise in same-store sales, when 6.2% was expected. Same-store sales at the company's Victoria's Secret stores rose 10%, with growth driven by strength across all categories.
Costco Wholesale Corp. posted a 7% rise in U.S. same-store sales excluding gasoline, besting the 6.5% expected.
Buckle Inc.'s February same-store sales grew 14.8%, well ahead of expectations for 5.8%. Fellow teen retailer Wet Seal Inc. reported a 5.8% drop, when a 9% decline was projected. Online sales fell 24% for the month. "We remain cautious about near-term sales expectations in light of our recent business trend," Wet Seal Chief Executive Susan McGalla said.
J.C. Penney Co. and Dillard's Inc. both said last month they would no longer be reporting same-store sales on a monthly basis. J.C. Penney switched off the reports as it revamps its approach to pricing, moving away from markdowns and focusing on everyday low pricing. But last week Penney said the month's sales were trending below a year ago.
Dillard's said limiting the report of same-store sales to quarterly results "provides a more complete representation of the company's performance."
"The retailers that had a tailwind going into the February season continued to drive sales increases," said Joel Bines, managing director in the retail practice at AlixPartners. "It's a fight for market share among retailers rather than a rising tide, and those with momentum are winning out."
(Source: The Wall Street Journal, 03/02/12)
Click here to email to client
Back to Radio Sales Today
Click here to view Job Postings.
RAB Workshop To Explore Mobile Marketing During NAB Show
Mobile apps, mobile streaming and mobile websites mean more mobile revenue for radio. Find out how your station can take advantage of these opportunities by attending the RAB workshop, Is Mobile Marketing the Future of Advertising?.
This seminar is one of five RAB-produced sessions that will be offered at the NAB Show, April 14-19 in Las Vegas. It's scheduled for Tuesday, April 17, from 10:30-11:45 AM in Room N239/241.
The NAB Show is the world's largest event covering the development, management and delivery of content across all media. For more information, click here.
Webinar This Week: Accountability for Managers & Salespeople
Knowing your goals, writing down the tasks necessary to achieve those goals, and having a plan that helps you execute them is critical to successful sales and sales management.
Join RAB's John Potter for this information-filled presentation, as he explores proven systems and strategies for keeping your sales team focused and on track.
This webinar will be offered today at 3 PM (Central), and again on Thursday at 10 AM (Central). For registration details, follow this link.