Comp store sales results for February 2011 are all over the map. (Finally the emergence of a clear separation between stronger/weaker performers?) Approximately half of the companies reporting monthly comp store sales reported an improved result in February 2011 versus January 2011. Half did not.
Many retailers suggested that February 2011 started out slow and finished strong. February 2011 was a “no excuse” month. Let’s remember that in February 2010 essentially EVERY retailer complained about weather negatively impacting sales.
After many retailers complained about the timing of income tax refunds for less than stellar sales in January 2011, a couple of retailers (CATO (CATO) and Fred's (FRED)) suggested that February 2011 benefited from “a shift in the timing of income tax refunds.”
Costco (COST) disclosed on its quarterly earnings conference call that fresh food category inflation was +LSD to +MSD in February 2011 versus a +LSD rate in January 2011. Food sundries inflation was disclosed as +LSD in February 2011 versus only +1.0% in January 2011.
Is the home category slowing? Pier 1 (PIR) reported a deceleration in its January/February 2011 results relative to December 2010. Home was disclosed as a relatively weaker category at Dillard's (DDS), Kohl's (KSS) and Target (TGT).
A retailer actually reported that its shoe business was relatively soft in February 2011. TGT reported that its shoe category was the softest group within its apparel category. Interestingly, last week Wal-Mart (WMT) disclosed that it had added back product to its shoe assortment. Did that decision by WMT hurt TGT (and possibly Collective Brands (PSS)?
There was almost no discussion about year-over-year merchandise margin trends in February 2011. Per usual, Limited Brands (LTD) discussed the topic in its monthly sales recording (total company flat versus LY).
LTD discloses that its La Senza chain in Canada reported a weaker merchandise margin versus LY in February 2011 via FX. Keep an eye on retailers with a heavy presence in Canada.
Not only does Gap (GPS) report relatively weak sales results for the month of February, but the company will no longer disclose its monthly traffic counts, relative gender performance or outperforming styles.
In February 2011, TGT was again outperformed by BJ's Wholesale (BJ). TGT’s grocery category delivered comp store sales in the low teen-plus range. Yet, the company continues to tout the RedCard and PFresh initiatives as continuing to “drive meaningful incremental sales and traffic in our stores.”
TJX Companies (TJX) disclosed today that it will no longer provide monthly inventory commentary.
Wet Seal (WTSLA) has cut back on its store growth plans for FY 2011. The company will now only open 34-36 new stores this year vs. the previous estimate of 60.
Our Compology this month is measuring relative top-line strength/weakness by comparing February 2011 comp store sales versus January 2011.
The following retailers reported a relatively stronger comp store sales result in February 2011 versus January 2011 (relative strength/improving trend):
Saks (SKS): (+10.9% improvement in February 2011 versus January 2011)
Stein Mart (SMRT): (+9.4% improvement in February 2011 versus January 2011)
Cato (CATO): (+9.0% improvement in February 2011 versus January 2011)
JC Penney (JCP): (+7.6% improvement in February 2011 versus January 2011)
The following retailers reported a relatively weaker comp store sales result in February 2011 versus January 2011 (relative weakness/decelerating trend):
Stage Stores (SSI): (-12.3% decline in February 2011 versus January 2011)
Limited Brands (LTD): (-12.0% decline in February 2011 versus January 2011)
Dillard's (DDS): (-7.0% decline in February 2011 versus January 2011)
Gap (GPS): (-4.0% decline in February 2011 versus January 2011)
Looking Ahead by Looking Back: What Happened in March 2010?
Sales in March 2010 were strong across the board. Comp store sales were boosted by a calendar shift and favorable weather versus the prior year. Twenty-four of 25 retailers that reported monthly comp store sales reported a flat or positive result.
In March 2010, the strongest category performance was in children’s apparel, grocery, soft home and shoes.
Week No. 5 was generally considered to be the strongest fiscal weeks in March 2010 (via Easter calendar shift and extremely favorable weather). Week No. 2 was generally held to be the weakest fiscal week in March 2010.
The southeast was generally held to be the strongest comp store sales region in March 2010. The west was generally held to be the weakest comp store sales region in March 2010.
In March 2010, COST disclosed that its average retail price per gallon of gas was $2.73.