Early Easter gives US chain stores sales unrealistic boost, April to suffer

The topsy-turvy world of Easter-inclusive comp sales reporting in the US came into stark focus Thursday.

With March performances skewed by an early Easter this year against a later positioning a year ago, figures mostly came in misleadingly high.

Those chain stores still reporting monthly results noted April will be hit as a result and emphasised combined sales for both March and April will best reflect trading performances.

Gap’s March same-store sales rose more than expected 2%, following a 6% dip a year ago as an early Easter and strong sales at Old Navy stores offset weakness in its signature and Banana Republic brands. Analysts had expected a 0.6% increase. Total sales for the five weeks ended April 4 rose 1% to $1.53bn

By brand, Old Navy comp sales surged 14% against a 7% dip a year ago; Gap stores dropped 7%, which matched the prior year’s decline and Banana Republic fell 3%, a slight improvement on the 4% decline last time.

“We are especially pleased with the strong customer response to Old Navy during this peak spring shopping month, and we remain focused on the steps necessary to drive improved product consistency across our entire portfolio,” said CFO Sabrina Simmons.

L Brands’ March sales were positively impacted by the earlier Easter, up 6% to $981.2m on a total basis and by 9% comps-wise. Analysts had expected a 5.8% rise. It noted Easter added 3-4% to its sales.

Costco Wholesale Corp posted a larger-than-expected drop in comparable sales in March /The warehouse club operator said the fall is due partly to one less sales day during the period because of Easter.

Costco said its comp sales fell 2% in the five weeks ended April 5, missing analysts’ expectation for a 1.2% dip.
Comps were flat in the US and fell 9% internationally. Total revenue for the period fell slightly to $10.4bn.

Stein Mart reported total sales for the five-week period ended April 4 ,jumped 14.2% to $155.8m as comparable sales increased 11.2%. It said March sales were “partly impacted” by earlier pre-Easter selling.

Geographically, most regions had high single or double digit comparable store sales increases, while the Northeast experienced a mid-single digit increase.

The Cato Corp saw its March sales jump 15% to $117m as same-store sales for the month increased 12%. CEO John Cato warned: “March sales were favourably impacted by the shift of Easter from mid-April last year to early April this year. We expect April sales will be unfavourably impacted.

“We continue to expect Q1 earnings per diluted share will be in the range of $1.00-$1.03,” he added. Teen retailer the Buckle said its comp sales for March slipped 0.5%. Net sales for the five-week period increased 1.7 %to $108.5m.

Fellow youth apparel retailer Zumiez said its total sales for March increased 11.1% to $70.7m. Comparable sales increased 5.5% compared with a drop of 2.9% in the prior year ago.

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