New York—While last month may have been the warmest March in more than 50 years, what really helped lift March retail sales were more optimistic consumers who spent more on spring apparel and accessories.
Of the 20 retailers tracked by Thomson Reuters, 10 surpassed retail analysts’ sales estimates. The International Council of Shopping Centers (ICSC) reported that its tally of 22 retailers found March comparable store sales rose 4.1%.
“Unseasonably warm and dry weather provided a significant lift to spring apparel and seasonally related merchandise sales,” said Ken Perkins, president of Retail Metrics.
The fact that Easter falls on April 8, two weeks earlier than last year, also bolstered sales, many retailers reported. Strong sellers were fashion forward apparel and accessories, especially color.
Last month, in its Easter spending survey, the National Retail Federation (NRF) predicted Americans would spend 11% more this year on Easter apparel, accessories, candy etc. than last year.
‘Color is Back!’
“People were out shopping in March like they haven’t in quite a few months,” Joel Bines, managing director of AlixPartners told Reuters. Even more interesting, most were that most were paying more for new clothes and accessories.
Barbara Kahn, director of the Wharton School’s JayH.Baker Retailing Center, agreed that consumers are more optimistic. “Color is back,” she said. “People are excited about it.”
Retail analysts also noted that with consumers buying more seasonal color, they were more likely paying regular prices instead of shopping markdown promotions.
“Nobody’s telling you what the profit number is, but it does appear like the promotional environment has eased,” said Jaime Katz, analyst at Morningstar.
“The companies have been seeing strong full-price sell-through, which means there is likely upside to first-quarter profit estimates,” said Randal Konik, analyst at Jefferies.
But Perkins of Retail Metrics pointed out that this strong March report may be followed by a disappointing April since retailers face difficult year-over-year comparisons due to a later Easter in 2011.
The ICSC forecast April comp store sales to rise 3% to 4%.
The following retailers reported their March sales today (Note: Walmart, JCPenney, Dillard’s, Abercrombie & Fitch, Sears Holdings, Hot Topic and American Eagle Outfitters among others, no longer report monthly sales results.)
●Macy’s Inc. posted a better-than-expected 7.3% increase in its March comparable store sales thanks to early Easter sales and growth in online shopping. Analysts’ average estimate expected a 4.8% increase.
Total sales grew 6.9% to $2.36 billion. Comparable sales at macys.com jumped 39% and 35.6% at bloomingdales.com.
“March sales exceeded our expectations beyond the benefits we anticipated from an earlier Easter and a shift in a cosmetics event from April last year to March this year,” Terry Lundgren, chairman/ceo, said.
Although the company expects its April sales will be weaker, it raised its first quarter comparable store estimate to an increase of 4.3% and 4.5%, up from an earlier view of 3% to 3.5%.
●Kohl’s posted a 3.6% increase in its March comparable store sales, ahead of the 2.1% increase analysts’ average estimate expected. And a reversal of a 6.5% decline in March 2011. Total sales increased 5.3% to $1.82 billion.
“Warmer weather and an earlier Easter combined to help improve our sales trend, especially in certain regions and business,” Kevin Mansell, ceo, said. “The cold weather regions–Midwest, Mid-Atlantic and Northeast–outperformed the company. Children’s apparel, driven by Easter demand, was the strongest business while men’s and women’s apparel also performed well.”
●Nordstrom Inc. reported an 8.6% increase in its March comparable store sales, better than the 5.8% analysts’ average estimate expected. Total sales grew 14.7% to $1.03 billion. Quarter-to-date comparable store sales have increased 9.2% compared with the same period in 2011.
●Saks Inc. said its March comparable store sales were up 6.3% in line with analysts’ average estimate. Total sales were up 6.3%
For March, the strongest categories included women’s contemporary apparel, fine jewelry, handbags, and men’s accessories, shoes, tailored clothing, and contemporary apparel.
●Bon-Ton Stores reported that its March comparable store sales were down 0.1%. Total sales decreased 0.1% to $254.1 million.
“March sales were in line with our expectations,” Brendan Hoffman, president/ceo, said. “Customers responded favorably to the newness and color in our spring assortments. Best performing businesses were better missy sportswear, ladies shoes, children’s and cosmetics, along with strong sales in fine jewelry.
“Ecommerce business posted a double-digit sales increase over the prior year period. Poor performing businesses were juniors, furniture and moderate traditional sportswear in missy, petites and large size.”
●Stage Stores posted a 4.7% increase in its March comparable store sales. Total sales increased 7.5% to $144 million.
Merchandise categories that achieved comparable store sales increases included: accessories, children’s, cosmetics, dresses, footwear, home & gifts, junior’s, misses sportswear and petites categories. Geographically, the Mid Atlantic,Midwest, Northeast, South Central and Southwest regions all had comparable store sales gains during the month.
Michael Glazer, interim president/ceo, said comparable store sales “benefited from warmer than normal weather and an earlier Easter versus last year. Conversely, the earlier Easter will have a negative impact on April’s comparable store sales, as will a shift in a Mother’s Day event to May this year from April last year.”
●Target reported a 7.3% jump in March comparable store sales, better than the 5.4% increase analyst’ average estimate expected. Total sales rose7.9% to $6.43 billion.
“March sales were well above our expectations, reflecting a healthy underlying trend combined with the benefit of an earlier Easter and favorable weather this year,” Gregg Steinhafel, ceo, said. “We’re now planning for a revised first quarter comparable-store sales increase of 5 to 6%, reflecting a low to mid single-digit increase in our April comparable store sales.”
●Gap Inc. rebounded from a 10% drop in its March 2011 comparable store sales, posting an 8% increase, beating analysts’ average estimate for a 4.4% increase. Total sales increased 10% to $1.46 billion.
By division, Gap North America had a 9% comparable store sales increase positive 9% versus a 9% decrease last year. Banana Republic North America posted a 5% increase in comp sales versus an 8% drop last year. Old Navy North America had an 11% increase versus a 12% drop last year. And the international division posted a 2% increase versus a 9% decrease last year.
“We delivered solid sales performance in March and are pleased with customer response to product across all brands,” said Glenn Murphy, ceo.
●Limited Brands said its March comparable store sales rose 8%, nearly double the 4.4% that analysts’ average estimate expected.
Total sales were $840.9 million, compared with $863 million last year. However, last year’s numbers included $84.3 million attributable to the sale of the company’s third-party apparel sourcing business.
●Cato Corp. reported comparable store sales increased 5% in March, reversing a decline in February. Total sales were up 7% reaching $103.9 million.
“In addition to the impact of the Easter shift, March sales benefited from warmer weather and the delayed flow of tax refunds,” John Cato, ceo said. Nonetheless, the company said the timing of Easter will cause April sales to suffer. Year-to-date, sales are flat over the year before.
●Wet Seal Inc. posted a comparable store sales decline of 7.8% in March, exceeding analysts’ average estimate that predicted a 6% drop. Total sales were down 5.1% to $58.6 million with a 4.2% drop in Wet Seal and a 10.1% decline in Arden B.
“March sales were in line with our expectations,” said Susan McGalla, ceo. “At Wet Seal, our shorts, skirts and overall bottoms business, as well as dresses and shoes, performed well, while tops and jewelry sales declined… In light of our recent business trend, we remain cautious about near term sales expectations.”
At Arden B, bottoms, fashion dresses and jewelry performed well, while the tops business declined.
●Buckle Inc. said its March comparable-store net sales advanced 6.4% but missed analysts’ average estimate for an 8.8% increase. Total sales rose 8.9% to $105.5 million.
Year-to-date comparable store sales are up 10%, with nine-week net sales rising 12.6% to $192.2 million.
●Zumiez reported March comparable store sales that raced past analysts’ average estimates for the seventh time, helped by higher sales in its men’s, kids and accessories.
Comparable store sales rose 14.1% ahead of analysts’ estimate of 8.9% growth. Total sales rose nearly 24% to $50.9 million.
●Ross Stores Inc. reported its March comparable store sales grew 10%, better than the 4.6% increase analysts’ average estimate forecast. Total sales jumped 15% to $955 million.
“We are very pleased with our much stronger than expected sales in March,” said Michael Balmuth, ceo. “Favorable weather throughout most of our markets, along with our ongoing focus on value, drove broad-based merchandise and geographic sales gains during the month.”
“This year Easter falls two weeks earlier than in 2011, and it is always difficult to predict the impact on sales of such holiday shifts,” Balmuth added. “While we hope to do better, we continue to forecast a 1% to 2% increase in April same store sales.”
●Stein Mart said its March comparable store sales fell 0.3% on lower demand for women’s accessories, sportswear and intimate apparel. The decline fell short of analysts’ average estimate for a 2% increase. Total sales rose 0.4% to $127.5 million.
March sales were strongest in the Midwest and Northeast, while demand was lower in the West and Florida, the company said. “Ladies boutique, dresses, linens, men’s furnishings and petites posted the strongest comparable sales, while gifts, ladies accessories, ladies plus size sportswear, intimate apparel and ladies casual sportswear posted weaker results.”
●TJX Cos. reported March comparable store sales nearly double analysts’ average estimate: the off-price retailer’s 10% increase beat the expected 5.3% increase. Total sales soared 14% to $2.3 billion last month.
“I am extremely pleased that our momentum continued in March, leading to a well-above-plan consolidated comparable store sales increase of 10% and strong increases in all of our businesses in the U.S., Canada, and Europe,” Carol Meyrowitz, ceo, said. “While unusually warm weather was a positive in the month, sales were also strong in regions where the weather is typically warm.”
●Costco Wholesale Corp.’s comparable store sales rose 6% in March, but missed analysts’ average expectation for a 6.7% increase. Comparable store sales in theUnited States rose 6% and were up 7% internationally. Excluding the effect of higher gas prices and foreign currency exchanges, comp store revenue increased 5% in theUnited States and climbed 9% internationally. Total revenue rose 10% to $9.13 billion.
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