SALON

Thursday, Mar 7, 2013 5:15 PM UTC

Retailers report modest sales gains for February

By

Topics: From the Wires,

NEW YORK (AP) — Americans cut back on spending in February as cold weather and economic challenges chilled their appetite for spring merchandise.

The nation’s retailers on Thursday posted moderate sales growth for February, a time when most stores get rid of winter merchandise and bring in swimsuits, ankle length pants and other spring fashions.

But Americans spent more judiciously during the month as they contended with an increase in the payroll tax of 2 percentage points, income tax refunds that came later than usual and rising gas prices. Winter storms throughout much of the country in February also likely made spring merchandise less appealing to them.

“February was a difficult month,” said Ken Perkins, president of Retail Metrics LLC., a research firm. “Retailers faced significant headwinds.”

February’s tally reflects a sharp drop in sales growth from January. Overall, 13 retailers reported on Thursday that revenue at stores open at least a year — an indicator of retail health — rose an average of 1.7 percent, according to the International Council of Shopping Centers, an industry trade group. That compares with a 4.5 percent increase in January.

But February’s results also mark a reduction in the number of stores reporting monthly revenue, including big names like Target, Macy’s and Nordstrom. Wal-Mart, the world’s largest retailer, hasn’t reported on a monthly basis in years. And with the shrinking list, Costco now accounts for about two-thirds of the tally. In total, the retailers that report monthly data represent about 6 percent of the $2.4 trillion in U.S. retail industry sales.

Among the companies that reported monthly results, the ones that cater to poor and middle-class shoppers said that Americans are still grappling with economic challenges. Many of them had to do heavy discounting to get shoppers to spend.

Bruce Efird, CEO of the discount chain Fred’s, said delayed tax returns and the increase in payroll tax weighed on customer’s spending patterns. Fred’s reported that revenue fell 1.5 percent in February, more than the 1.3 percent drop Wall Street had expected. Fred’s also lowered its fourth-quarter outlook due to markdowns and higher-than-expected costs.

Cato, a woman’s clothing chain, also reported that February revenue dropped, by 3 percent compared with the 4 percent analysts had expected. The company said the figure reflects Americans’ hesitance to spend right now.

“February sales reflect the continuing difficult economic environment. We did see some beneficial impact from the delay in tax refunds from January,” said John Cato, CEO of Cato, a women’s clothing chain.

Limited Brands Inc., which operates Victoria’s Secret and has been on a strong winning streak, said economic challenges also hurt its business. The company said that it had to discount more heavily to bring in shoppers in February. The company said that profit margins also were squeezed.

Still, Limited turned in a 3 percent increase in revenue for February, above the 2.6 percent rise analysts expected.

Not every company posted disappointing results, though. Costco, which caters to affluent shoppers, was among the big exceptions.

Costco’s revenue rose 6 percent in February, beating Wall Street’s expectations. Analysts expected a 5.1 percent increase.

More By Anne D'innocenzio.

Next Article

Related Stories

More Related Stories

Featured Slide Shows

The week in 10 pics

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11
  • Lisa Montgomery embraces her nephew Thursday after a tornado tore apart her home in Cleburne, Texas. The twister killed six people and destroyed entire swaths of the North Texas town.
    Credit: AP/LM Otero

  • Jack McMahon, the defense attorney for abortion doctor Kermit Gosnell, speaks outside the Criminal Justice Center in Philadelphia Tuesday. His client was convicted of killing three babies in his clinic, and will serve multiple life sentences.
    Credit: AP/Matt Rourke

  • A photo taken Monday captures Vice President Joe Biden's response to a Milwaukee second-grader's innovative proposal to end America's epidemic of gun violence. This guy!
    Credit: AP/Jenny Aicher

  • Sen. Rand Paul, R-Ky., flanked by a grouper-eyed Michele Bachmann, addresses the IRS' admission that it targeted Tea Party groups in advance of the 2012 election. In an op-ed for CNN Thursday, the Kentucky senator slammed the president for his faux outrage.
    Credit: AP/Molly Riley

  • Ousted IRS chief Steven Miller is sworn in on Capitol Hill Friday. Miller testified before the House Ways and Means Committee on the extra scrutiny the agency gave conservative groups applying for tax-exempt status.
    Credit: AP/J. Scott Applewhite

  • Attorney General Eric Holder pauses as he testifies on Capitol Hill before the House Judiciary Committee Wednesday. Holder is under fire, among other things, for the Justice Department's gathering of phone records at the Associated Press.
    Credit: AP/Carolyn Kaster

  • O.J. Simpson sits during an evidentiary hearing at Clark County District Court in Las Vegas, Nev., Thursday. Simpson, who is currently serving a nine-to-33-year sentence in state prison for armed robbery and kidnapping, is using a writ of habeas corpus to seek a new trial.
    Credit: AP/Las Vegas Review-Journal/Jeff Scheid

  • Major Tom to ground control: On Sunday astronaut Chris Hadfield recorded the first music video from space, a cover of David Bowie's "Space Oddity."
    Credit: AP/NASA/Chris Hadfield

  • When it rains it pours. President Barack Obama speaks during a news conference Thursday with Turkish Prime Minister Recep Tayyip Erdogan, inexplicably inspiring an #umbrellagate Twitter meme.
    Credit: AP/Jacquelyn Martin

  • A smoke plume rises high above a road block at the intersection of County A and Ross Road east of Solon Springs, Wis., Tuesday. No injuries were reported, but the the wildfire caused evacuations across northwestern Wisconsin.
    Credit: AP/The Duluth News-Tribune/Clint Austin

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11

Related Videos

Comments

 0 Comments

Comment Preview

Your name will appear as username

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>

follow salon

Most Read

Popular on Reddit

links from salon.com

From Around the Web

Presented by Scribol
listener_new_rect The Listener: So long, Sookie Stackhouse

Recommendations