Apr 8, 2010
Early Easter boosts March retail sales
Apr 8, 2010
By Phil Wahba
NEW YORK (Reuters) - A nascent pickup in consumer spending has expanded beyond discounters to teen clothing chains and other store chains, according to the first batch of March sales reports from U.S. retailers.
In what may be the strongest sign yet of revived consumer demand, analysts expect that March sales at stores open at least a year rose 6.3 percent from a year earlier, marking the seventh consecutive month of growth, according to Thomson Reuters.
But analysts and some retailers have warned that much of the boost came from an early Easter holiday that may have simply shifted sales to March from April.
Early reports from Wednesday 7 April and Thursday 8 April show that many retailers are set to beat expectations as they also benefited from warm weather and an improved job market.
So far, nearly all of the 12 retailers that have reported March sales, out of the 28 Thomson Reuters tracks, have topped estimates.
Warehouse club operator Costco Wholesale Corp (COST.O) said on Thursday 8 April that same-store sales rose a better-than-expected 10 percent.
Other retailers that reported March sales above Wall Street expectations include Limited Brands Inc (LTD.N). Same-store sales for the operator of lingerie chain Victoria's Secret rose 15 percent.
On Wednesday 7 April, youth apparel chains Hot Topic Inc (HOTT.O) and Zumiez Inc (ZUMZ.O) also handily topped expectations, and were followed by strong sales reports from Wet Seal (WTSLA.O) and The Buckle Inc (BKE.N) on Thursday 8 April.
But in a sign of how Wall Street expectations may be getting ahead of actual performance, Abercrombie & Fitch (ANF.N) came in short of forecasts with a 5 percent rise.
Easter came a week earlier this year and may have boosted March sales at April's expense.
Earlier this week, discount retailer Family Dollar Stores Inc (FDO.N) and drugstore operator Walgreen Co (WAG.N) each reported strong March sales, crediting an early Easter.
But Family Dollar Chief Executive Officer Howard Levine warned on a conference call on Wednesday 7 April that the timing of the holiday would hurt April sales.
And retailers were grappling with the worst consumer spending slump in decades in March 2009, when same-store sales fell 5 percent, making comparisons easy.
Analysts have forecast that discount retailers would report an 8.5 percent increase in March, the most of any group.
Department stores, among the worst hit during the downturn, were expected to report gains of 8.2 percent, led by Kohl's Corp (KSS.N) with a forecast 12.4 percent jump.
Teen retailers are expected to show the most dramatic turnaround, with a 7.4 percent rise. That would be a marked improvement over the year-earlier plunge of 13.6 percent.
Other retailers, including Macy's Inc, (M.N) TJX Cos Inc (TJX.N), JC Penney Co Inc (JCP.N) and Saks Inc (SKS.N), are set to report March sales later on Thursday (8 April) morning.
(Additional reporting by Martinne Geller and Jessica Wohl; Editing by Michele Gershberg and Lisa Von Ahn)
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