* Analysts see March same-store sales up 1.8 pct -Thomson
* TJX, Costco miss estimates; Ross Stores, L Brands beat
By Phil Wahba and Dhanya Skariachan
April 11 Cold weather and lingering concerns
about the job market dampened U.S. shoppers' enthusiasm and hurt
early spring selling at several retailers in March, but some
executives and analysts said they expected business to improve
slightly in April.
Several top U.S. retailers, including Costco Wholesale Corp
and TJX Cos Inc, the parent of T.J. Maxx,
reported weaker-than-expected March sales.
The U.S. labor market recovery showed signs of losing
momentum in March as employers hired at the weakest pace in nine
months, raising concerns that consumer spending will be hurt.
"Anyone who thinks the consumer will come swinging out of
the gate is fooling themselves," said Alison Jatlow Levy, retail
strategist at consulting firm Kurt Salmon.
Many parts of the country also experienced the worst of
winter in February and March, later than normal, causing
shoppers to hold off on purchases of spring merchandise.
Costco's sales at stores open at least a year were up 4
percent, less than the 5.2 percent jump analysts expected for
the warehouse club discount retailer.
TJX, the owner of the low-price Marshalls chain as well as
T.J. Maxx, reported a 2 percent decline in March same-store
sales, deeper than the 1 percent drop analysts had projected.
But the company said business improved as the weather warmed up,
and Chief Executive Carol Meyrowitz said April "was off to a
Michael Niemira, chief economist for the International
Council of Shopping Centers, and others also expect things to
improve for retailers in April as shoppers release some pent-up
demand and lower gasoline prices boost their discretionary
The ICSC forecasts a 2 percent to 3 percent increase in
April same-store sales, and a 3 percent to 4 percent gain
The arrival of delayed tax refunds for some customers should
also help boost April sales, said Ken Perkins, president of
consulting firm Retail Metrics.
The S&P 500 Retail Index, which fell earlier on
Thursday, rose as much as 1.8 percent to touch a more than
one-year high, outpacing the broad S&P 500's 0.6 percent
gain. The retail index finished the day up 1.22 percent.
POCKETS OF STRENGTH
Analysts expect 13 top U.S. retailers, including TJX Cos and
Gap Inc, to post a 1.8 percent rise in same-store sales
for March, according to Thomson Reuters, down from an increase
of 2.9 percent a year earlier.
Excluding drugstore chains Walgreen Co and Rite Aid
Corp, whose results are heavily skewed by prescriptions
sales, Wall Street expects a gain of 2.2 percent, down from a
rise of 7.1 percent last year.
There were some bright spots in the month, the economy and
Victoria's Secret parent L Brands Inc reported
higher-than-expected sales at all of its chains. Company wide,
same-store sales rose 3 percent, while Wall Street expected them
to be flat, according to Thomson Reuters data. The retailer's
shares rose more than 5 percent.
Low-priced retailer Ross Stores Inc, which has less
exposure to the colder regions of North American than larger
rival TJX, posted an unexpected gain in same-store sales. It
said it now expected its quarterly profit to come in slightly
above its earlier forecast of $1.00 to $1.04 per share. Its
stock rose 7.5 percent.
Zumiez Inc and Buckle Inc, which cater to
younger shoppers who are particularly exposed to the vagaries of
the economy, both reported stronger-than-expected numbers.
American Apparel Inc said its March same-store sales
were up 8 percent.
In the case of Gap, the news was not as bad than expected.
March same-store sales were down 1 percent, less than the 2.1
percent drop analysts expected.
PAIN OF COLD WEATHER
Many retailers were hampered by the cold start to March,
prompting many shoppers to put off buying warmer-weather
Also, Easter fell on March 31 this year, compared with April
8 last year. With the wintry weather leading up to the holiday,
shoppers may have held off on buying clothes for spring.
Low-priced specialty clothing chain Cato Corp,
regional department store operator Stein Mart Inc and
discount general merchandise retailer Fred's Inc all
blamed weather and Easter's timing for steeper-than-expected
drops in March same-store sales.
Last week, Rite Aid said its same-store sales fell 2
percent, but sales of general merchandise, a closer proxy to
consumer discretionary spending, rose 3.8 percent.
Larger rival Walgreen reported a modest 0.7 percent
same-store sales gain, with a better showing for general
merchandise, which beat expectations.