February Retail Sales Beat Estimates

February Retail Sales Beat EstimatesNew York—Despite rising gasoline prices and bad weather in much of the country, same store retail sales rose 4.3% in February, marking the 18th straight monthly gain since September 2009 and the fifth time in the past seven months that sales have beaten projections.

Noting that analysts’ average estimates was for comparable store sales to grow 3.8% at the 27 chains tracked by Retail Metrics, the figure was seen as significant since February is the first month of the first quarter for most retailers and the period’s smallest in terms of sales. But the month is significant because it gives retailers a bead on just what kind of demand–and price acceptance–there is for their new spring and summer merchandise, Dow Jones News reported on Thursday.

A Positive Sign Going into Spring

Sales revenue at stores open at least a year is considered a key indicator of a retailer’s health. Limited, JCPenney, Macy’s, Saks and Neiman Marcus led. Target and Gap missed targets. February results built on the best holiday season since 2006, but rising gasoline prices could hurt future sales. Higher cotton and other commodity costs could also hit profit margins, analysts said.

The International Council of Shopping Centers (ICSC) also reported American chain-store sales climbed 4.2% in February compared with the same period last year. The result beat the ICSC’s forecast of a 2.5% to 3% gain. “The breadth and the strength of sales gains in February was encouraging as more retailers and retail segments participated in the improvement,” said Michael P. Niemira, the ICSC’s chief economist.

The positive February results were a  “combination of pent-up demand for spring merchandise and the macro picture is improving,” said Ken Perkins, president of researcher Retail Metrics. “The jobs market is turning a corner. The result of that is consumers are experiencing more confidence in their ability to spend.

The following are results from most major retailers, but the February results don’t include the teen triumvirate of Abercrombie & Fitch, American Eagle Outfitters and Aeropostale which ceased reporting monthly sales results in favor of quarterly reports only:

  • Macy’s, Inc. said same-store sales rose 5.8% in February with total sales reaching $1.76 billion, up from $1.67 billion in the same month 2010. “Our fiscal 2011 started off with a stronger-than-expected February performance at both Macy’s and Bloomingdale’s. Consumer reaction to new spring merchandise has been encouraging,” said Terry J. Lundgren, chairman, president and ceo.Online sales were up 30.9% in February. The company said same-store sales in its combined March-April period are expected to be up by approximately 3%, consistent with its full-year guidance.
  • Kohl’s posted 5% comparable-store sales increase last month. Total sales increased 7.1% to $1.2 billion. While all departments reported sales increases, men’s, women’s and children’s departments outperformed the company.
  • JCPenney reported its February comparable store sales increased 6.4%, with all divisions reporting an increase over last year. Women’s apparel and accessories, children’s apparel, and fine jewelry reported the strongest results for the month.  Geographically, all regions experienced comparable store sales gains with the northeast and southwest regions delivering the best performances. Analysts’ average estimate was for a 4.2% same-store sales increase. Online sales increased 11.8% from the same month last year.
  • Dillard’s said that total and same-store sales were down 1% in February. The department store reported merchandise sales $492.6 million compared to $499.2 million during the same period last year. Sales were “slightly above” average total company trend in its Western region, consistent with trend in its Central region and “slightly below” trend in its Eastern region. Sales in Dillard’s home and furniture and men’s categories were “significantly below” trend during the period, the company said.
  • Neiman Marcus reported a 12.7 % surge in February same-store sales, with its strongest results from stores in the West, Northeast and Texas. Best performing categories were fine women’s apparel, footwear and designer handbags. Precious jewelry and men’s apparel also performed well, the company said. The Neiman Marcus stores division, which includes Bergdorf Goodman, posted a 12.6% increase from the same month last year. Neiman Marcus Direct, which operates its online shops and catalogs, had a 13.2% increase. For the quarter ended Jan. 29, Neiman Marcus posted a 6% increase in same-store sales. Total sales increased 6.3 percent to $1.17 billion.
  • Saks Inc. reported same-store sales were up 15.3% with the strongest categories at its Saks Fifth Avenue stores included women’s apparel, men’s apparel, footwear, handbags, fashion jewelry, cosmetics, and fragrances. In addition, Saks Direct performed well. Sales totaled $196.2 million for the period compared to $171.7 million a year ago, reflecting a 14.2% increase.
  • Nordstrom Inc. reported same-store sales rose 7.3% compared with a year earlier, beating analysts’ average estimate for a 4.2% increase. The Seattle-based retailer reported that sales rose to $606 million from $539 million in February 2010. Of the 7.3% same-store sales gain last month, Nordstrom said that its full-line and direct sales rose 9.6% and Nordstrom Rack same-store sales rose 1.6%.
  • The Bon-Ton said that revenue at store open at least a year fell 0.5% as more consumers stayed at home to avoid massive snowstorms. Total sales fell 1.1% to $197.7 million. The retailer reported said its weakest segments were ladies’ moderate sportswear and children’s. Among the better performers were fine jewelry, furniture, shoes, ladies’ better sportswear and men’s sportswear.
  • Stage Stores Inc.’s same-store sales declined 7.2% during February, a big miss from analysts’ average estimate for a 2.5% increase.  While the retailer blamed extreme weather in the first half of the month for the decline, the company still projected same-store sales growth of 1% to 3% for the fiscal first quarter and plans to release additional guidance with its fourth-quarter results. “Our inventories are well managed and our underlying fundamental traffic trends remain solid,” Andy Hall, president/ceo, said, adding that same-store sales growth of 10% in the second half of February wasn’t enough to offset the impacts from harsh weather–especially in Texas, Oklahoma, Arkansas and Missouri–which represents nearly 51% of Stage Stores’ same-store sales base.
  • Cato Corp. reported February sales of $86.4 million, an 8% increase over sales of $80.0 million for the four week period ended February 27, 2010.  Same-store sales for the month increased 5% over the prior year. “February sales benefited from a shift in the timing of income tax refunds and more favorable weather than last year,” said John Cato, chairman, president, and ceo.
  • Target reported same-store sales rose 1.8% for February, helped by sales of groceries and by shoppers with its branded cards taking advantage of a 5% discount, but the results missed analyst expectations. Analysts’ average estimate was for an expected a 2.2%. Total revenue rose 2.4% to $4.75 billion. Same-store rose more than average in California, South Florida and the Mid-Atlantic but less than average in the Midwest, the Carolinas and the Northeast. Grocery and apparel sales rose while home products and electronics sales fell. Target expects March same-store revenue to fall because Easter-related sales will be pushed to April with Easter falling three weeks later. For the combined March and April period, however, Target expects the figure to rise in the low-single-digit percentage range.
  • Gap Inc. said its stores’ declined 3% in February, hurt by weak sales in the Midwest. Analysts’ average estimates were expecting a 0.9% decline. Sales at Banana Republic stores open at least a year fell 4% during the month, compared with a 7% increase last February. Sales at Gap stores in North America dropped 1%, compared with a 1% improvement. Sales at Old Navy North America fell 4% compared with an increase of 5% last year. International sales declined 7%; they were flat last year. Total revenue fell 2% to $821 million.
  • Limited Brands Inc. said sales at stores open at least a year surged 12% in February, helped by strong sales at its Bath and Body Works and Victoria’s Secret stores. Net sales also grew 12% to $670.9 million from $600.1 million a year earlier. For March, however, the company expects flat sales at stores open at least a year, hurt by the later Easter holiday.
  • Buckle, Inc. said its same-store sales for February increased 2.1%. Net sales increased 6.4% to $73.9 million from $69.4 million in February a year ago.
  • Hot Topic posted a 1.4% decline in same-store sales, compared with analysts’ estimate of a 5% drop and on top of a 7% decrease in the year-earlier period. Total sales for the month fell 1.5% year over year to $53.4 million. Hot topic sales declined 3.9% to $38.1 million, while Torrid sales increased 4.7% to $15.3 million compared to last year.
  • Stein Mart said total sales rose 7.9% to $80.4 million and comparable store sales rose 8.2%. The retailer said all major merchandise categories reported positive sales comparisons last month, with the strongest sales in ladies’ career sportswear, men’s sportswear and the home section. Geographically, sales were strongest in the Southeast and Northeast.
  • Wet Seal Inc. reported better than expected February sales. The teen retailer saw sales at its stores open at least a year rise 7% ahead of analysts’ average estimates for a 1% fall in sales last month.The company’s dominant Wet Seal division led the gain for teen girls, which saw a 7.6% increase in same-store sales. Its Arden B. division was up 3% last month. Total sales for the month were $48.2 million, up 12.7% from a year earlier.
  • Zumiez reported February same-store sales jumped 13%, just short of Wall Street’s forecast of 4.2%, and building on 11% growth last year. Total net sales for the period increased 18.3% to $32.7 million compared with $27.6 million. The February results marked the fifteenth consecutive month of comparable store sales growth.
  • TJX Cos., which operates such retail chains as T.J. Maxx, Marshalls, and HomeGoods, said its same-store sales rose 3% in February when compared with the same period a year ago.The company’s February performance came on top of double-digit increases a year ago. “We’re pleased to be off to a good start in the new year, well positioned to capitalize on the great fashions and brands that we see in the marketplace,” Carol Meyrowitz, ceo, added. Total sales for the month were $1.5 billion, up from $1.4 billion for the comparable four-week period a year ago, TJX said in a press release.
  • Ross Stores reported a 7% improvement in February sales, helped by stronger-than-expected gains in its established stores. The off-price retail apparel and home accessories store chains said sales were $595 million, up from $554 million in February 2010. Comparable-store sales grew 3% on top of 11% last year, led by higher demand for dressers and Juniors apparel, particularly in its Mid-Atlantic and Florida markets. Ross kept its March and April sales forecast unchanged, with same-store sales expected to be down 2-3% in March and up 4-5% in April.
  • Costco Wholesale Corp. reported second-quarter profit that narrowly beat analysts’ forecast. Net income advanced 16%  $348 million, or 79 cents a share, in the quarter ended Feb. 13, from $299 million, or 67 cents, a year earlier. Analysts had projected 78 cents a share. Membership fee revenue advanced 10% to $426 million in the quarter. Total revenue rose to $20.9 billion from $18.7 billion a year ago. Analysts expected $20.6 billion.
  • BJ’s Wholesale Club’s fiscal fourth-quarter net income fell 81% on a one-time $41.1 million charge related to store closings, restructuring and asset impairment. But its adjusted earnings beat expectations. The wholesale club operator earned $10.2 million for the quarter, compared with $54.5 million a year ago. Net sales for the fourth quarter ended Jan. 29, increased by 7.4% to $2.90 billion, and comparable club sales increased by 3.8%, including a contribution from sales of gasoline of 2.1%. For the year ended Jan. 29, BJ’s reported net income of $95.0 million.

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