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Retailers report sales declines

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Reuters
Published
today Apr 9, 2009
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By Martinne Geller

NEW YORK (Reuters) - Many U.S. retailers posted lower March sales at stores open at least a year, as shoppers remained focused on necessities and put off spring purchases because of a later Easter holiday this year.

Of the dozen or so retailers that have already reported March results, most posted same-store sales declines, as the recession continues hamper consumer spending. About half of them topped analysts' expectations, while about half disappointed.

Costco Wholesale Corp reported a 5 percent decline in March same-store sales, hurt by weakness in nonfood categories and lower gasoline prices. Analysts on average were expecting a 1.7 percent decline, according to Thomson Reuters data.

Excluding the impact of lower gas prices, Costco posted a 4 percent gain. The warehouse club operator benefited from the later Easter, which brought an extra day of business in March because it did not have to close its stores for the holiday.

But the later Easter was not good news for everyone.

Specialty apparel and accessories retailers Zumiez Inc, Stage Stores Inc and Wet Seal Inc reported bigger-than-expected declines in March sales, saying the timing of Easter allowed consumers to put off buying holiday-related goods like spring dresses and shoes.

Stage Stores and Wet Seal both said that in order to get a truer sense of their early spring sales trends, it will be necessary to look at the March and April periods together.

Given the yearly fluctuations in the timing of Easter and the start of warmer weather in many parts of the country, most analysts tend to look at results from March and April together.

Apparel chains that cater to teenagers, such as Buckle Inc and Hot Topic Inc, posted stronger-than-expected results. Hot Topic reported a 7.1 percent rise in March sales, beating the analysts' average estimate for a 5.4 percent increase, according to Thomson Reuters.

Independent retail analyst Jennifer Black said she was not surprised by Hot Topic's results, calling the company "one of the few retailers who are out on top," despite reporting declines in certain merchandise categories due to the Easter shift.

Limited Brands Inc reported a 9 percent decline in March sales, surprising analysts who expected a 12 percent drop. The company cited better-than-expected sales at its Victoria's Secret and Bath & Body Works stores.

(Additional reporting by Aarthi Sivaraman in New York and Jessica Wohl in Chicago; Editing by Lisa Von Ahn)

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