New York—Ingredients such as inclement and colder-than-normal weather, worries over sequestration and its effects and the continued slow pace of the U.S. economic recovery combined for a recipe that lead to tepid April comparable store sales.
Thomson Reuters said today that total comparable store sales rose 3.7% in April, better than the 0.8% increase in April 2012 and an improvement over March. But retail analysts had expected a 4.3% increase last month.
At Retail Metrics, the April comp store figure was up 2.8% missing its forecast for a 3.5% increase. “April (comparable-store sales) were generally weak” among retailers nationally, said Ken Perkins, president at Retail Metrics, noting the poor weather condition in many parts of the country and concerns over federal budget cuts.
“There just wasn’t a reason to go to the mall because the weather wasn’t cooperating,” said Barbara Kahn, director of the Baker Retailing Center at the University of Pennsylvania’s Wharton School told the Wall Street Journal. “There are also economic matters like the payroll tax that serve as a drag.”
The International Council of Shopping Centers (ICSC) reported a 2.7% increase in April comparable store sales. Excluding drugstores, the comp increase was up 4.7%.
Off-price retailers such as TJX and Ross reported strong gains due to their discounted merchandise offerings, economists said. Teen retailers, such as Buckle and Zumiez, also posted strong comp gains.
While comparable store sales are considered an important measurement of retailer’s performance because they exclude results from stores that opened or closed in the last year, some analysts are skeptical about monthly comparable store sales figures.
In the last few years, most major retailers, including Walmart, Macy’s, Target, JCPenney, Dillard’s, Nordstrom, etc., stopped releasing monthly sales reports, opting instead for their quarterly reports. And with TJX Cos. And Ross Stores planning to cease monthly reports too, the list of retailers supplying a monthly gauge is dwindling.
Below are April sales reports from the remaining retailers who report (Note: Gap Inc. releases its April report after press time):
●L Brands Inc. (formerly Limited Brands Inc.) said comparable store sales rose 2% in April, missing analysts’ expectations for a 4.8% rise. Total net sales were $660.5 million, up from $659 in April 2012.
By division Victoria’s Secret reported a 2% increase in comp store sales as did the company’s La Senza, the Canadian lingerie chain.
“We are disappointed with our overall performance in April, particularly in bras,” said Amie Preston, chief investor relations officer. “While we have seen strength in our core offerings, our recent introductions have not offset the volume from styles exited in the past 12 months.”
Preston also suggested April sales were “negatively impacted by the pull forward of Easter and spring break business into March, and this impact is difficult to quantify.”
●Cato said its April comparable store sales, which rose 1%, were helped by the shift in the Easter holiday to March. Analysts’ average estimate expected Cato to post a 1% decline. Total sales fell 9% to $77 million.
Due to the Easter shift, the company said the best performance measure would be combined sales for March and April, which fell 3%. Comparable store sales for the period declined 5%.
As a result, John Cato, chairman/ceo, said that the company lowered its first quarter earnings forecast to $1.02 to $1.04 a share compared to its previous forecast for $1.03 to $1.14 a share.
●American Apparel Inc. said its April comparable store sales increased 3%–that included a 4% increase in its retail stores and a 2% decrease in online sales. Total sales rose 4% to $49.8 million. (The company’s wholesale net sales were up 7%)
According to Dov Charney, chairman/ceo:”The decrease in Internet sales in the month of April was due to a shift in the timing of certain promotions that will benefit the May online comparisons. So far in May we are very pleased with sales performance in our stores and online. We believe the combination of better weather and a strong summer offering are having a positive impact on our overall results.”
●Buckle, Inc. posted a 6.2% increase in its April comparable store sales handily beating analysts’ consensus for a 1.5% increase. Total sales rose 3.1% to $73.8 million.
Preliminary figures for the 14 week ending May 4 were for a 1.2% increase in comp sales while total net sales were up 2.3% to $269.7 million.
●Zumiez Inc. reported a 4.6% increase in its April comp store sales ahead of analysts’ estimate for a 3.3% increase. Total net sales jumped 12.1% to $43 million.
Footwear, juniors and men’s performed best, while accessories and boys had declines, the retailer said. Its best week in the first week of the month.
For its recently ended quarter, Zumiez posted a 22.1% in net sales to $224.4 million. Comparable store sales edged down 1% due to a decline in comparable store transactions, offset by an increase in dollars per unit.
●Ross Stores, Inc. posted a comparable store sales increase of 7% beating analysts’ estimate for a 5.8% increase. Total sales rose 12% to $778 million.
For its preliminary first quarter report, Ross reported a net sales increase of 6% to $2,385 billion. Comparable store sales for the quarter were up 3%.
“We are pleased with the above-plan sales and margin gains we achieved for both April and the first quarter, especially considering our very strong prior year comparisons,” said Michael Balmuth, vice chairman/ceo. “These results were driven by our ongoing ability to deliver compelling bargains to today’s value-focused customers.”
●Stein Mart‘s April comparable store sales were up 8% easily beating analysts’ estimate for a 3% increase. Total revenue rose 1.6% to $99.2 million.
Women’s sportswear and linens were best performing categories, while accessories, dresses and men’s sportswear were softer. Sales were strongest in the Southeast and Mid-Atlantic, while Texas suffered from a drop in sales due to bad weather.
For the quarter to date, comp store sales increased 1.2% and total revenue rose 3.8% to $321.4 million.
“Now that we are seeing warmer weather, our customers are responding well to our spring merchandise and we are truly satisfied with what this has done for our sales,” Jay Stein, chief executive, said.
●TJX Companies reported that its April comp store sales rose 8% which was on the high end of its forecast and topped analysts’ estimate for 6.8% growth. Total sales rose 9% to $2 billion.
For its first quarter preliminary sales, the parent to Marshalls and TJ Maxx, said net sales rose 7% to $5.8 billion, missing analysts’ estimate for $6.16 billion in sales.
raised the low end of its earnings view for the quarter ended Saturday by one cent, now projecting 61 cents to 62 cents a share. Sales rose 7% to $6.2 billion, topping the $6.16 billion consensus view, while same-store sales rose 2%.
“Customer traffic drove comp increases at all divisions, as consumers responded to our extremely fresh selections of branded spring apparel,” said Carol Meyrowitz, chief executive.
“As we enter the second quarter, May is off to a strong start and our inventory levels are in an excellent position for us to buy into the enormous amount of quality opportunities we are seeing in the marketplace.”
●Costco Wholesale Corp. said its April comp store sales rose 4% just missing analysts’ estimate for a 4.5% increase. The company said changes in gasoline prices and foreign exchange rates negatively impacted comp sales. Total revenue rose 7% to $7.98 billion.
Excluding the impact of gasoline prices and foreign currency exchange rates, Costco’s comp sales increased 6%. Its U.S. and international stores also reported 6% gains for the month. A 6 percent increase in the metric was also reported for the year-to-date for the total company, U.S. and international locations.