New York, NY, Mar. 6--Winter storms and worries about war gave consumers more reasons not to shop in February, resulting in another month of disappointing sales.
As storeowners reported their February results, Wal-Mart Stores announced sales at the low end of its expectations, and apparel retailers and department stores were again the hardest hit.
But there were some exceptions, including Pacific Sunwear of California Inc. and Gap Inc., both of which reported that same store sales beat Wall Street expectations.
Overall, the cold weather and uneasiness about a war with Iraq left consumers in no frame of mind to buy spring fashions like micro mini skirts.
The biggest blow in February came when a snowstorm blanketed the Northeast during President's Day weekend, forcing many stores to close and wiping out the much anticipated sales jump that usually kicks off the spring season. Niemira estimated that the snowstorm trimmed about 0.5% from the monthly sales figures. A survey by Floor Focus Magazine found that floorcovering retailers in the New York Metro Market were harder hit than most businesses.
"The the weather complicated the issue," said Michael P. Niemira, vice president of Bank of Tokyo-Mitsubishi Ltd. "Weather is a passing problem, but concern about war and the economy is a lingering issue and therein lies the problem."
Bank of Tokyo-Mitsubishi's same store sales tally of 69 stores was up only 0.4% in February, compared with an increase of 6.2% a year ago. Niemira said it was the weakest performance since last November, when the index was unchanged.
A report from the Labor Department underscored a sluggish economy, stating that new claims for unemployment benefits rose last week to their highest level of the year, marking the third week in a row that layoffs increased. The government reported that initial applications for unemployment insurance increased last week by a seasonally adjusted 12,000 to 430,000.
Such a weak environment is stalling sales even at discount chains, like Wal-Mart, which reported a modest 2.6% increase in same store sales, in line with the consensus from Thomson First Call. It was at the low end of the company's goal for a 2% to 4% increase. Total sales were up 9.2%.
Meanwhile, Target Corp. said same store sales were down 1.4%, weaker than the 1.0% decrease that analysts were expecting. Total sales were up 6.4%.
Here are selected same store sales for February for other leading retailers: J.C. Penney same store sales at department stores declined 2.1%, total sales were down 1.3%; May Department Stores same store sales were down 8.9%, total sales decreased 7.5%; Sears, Roebuck and Co. same store sales in its domestic business fell 9.4%, total domestic sales were down 7.9%.
