US Apparel Retailers Report Soft February Comp Sales

(RTTNews) - U.S. apparel retailers on Thursday reported soft February sales as the Polar Vortex weather saw shoppers staying indoors and kept mall traffic weak in the first half of the month. Sales during the month were some what aided by Valentine's Day and Presidents Day sales promotions.

February was said to be the second coldest in more than 25 years for the U.S. overall and the coldest in seven years.

The month of February is normally also the slowest month for retailers following the most important holiday season sales rush. There was also significant deterioration in U.S. consumer confidence in February.

Sales at established stores or comparable-store sales is a key retail industry performance metric to gauge activity at store locations that have been open for at least a year. Analysts polled by Thomson Reuters expected the retailer's comparable store sales to increase 1.9 percent in February, compared to 4.8 percent growth last year.

L Brands, Inc. (LB), the operator of Victoria's Secret and Bath & Body Works chains, said its February comparable store sales increased 2 percent, reflecting strength of its Victoria's Secret Stores and Bath & Body Works stores. The result topped Street expectations for a 1.5 percent increase. Net sales were $750.0 million, up from $712.7 billion last year.

Regional discounter Stein Mart, Inc. (SMRT) reported a 2.1 percent drop in comparable store sales for the month of February, while analysts were expecting sales to grow 2.5 percent. Total monthly sales also decreased to $84.5 million from $86.7 million in the prior-year month.

Teen apparel retailer Buckle, Inc. (BKE) announced that comparable store net sales for the month of February decreased 1.4 percent. However, net sales edged up 0.2 percent to $89.5 million from last year's $89.3 million.

Meanwhile, value-priced fashion apparel retailer Cato Corp. (CATO) reported that February same-store sales increased 1 percent, and total sales also grew 3 percent from last year to $87.0 million from $84.7 million.

"February sales were negatively impacted by winter storms the first two weeks of the month. However, that impact was offset by strong selling in the last two weeks of the month driven by warmer weather and tax refund spending," commented John Cato, Chairman, President, and CEO of Cato.

Specialty retailer of action sports related apparel, footwear, equipment and accessories Zumiez, Inc. (ZUMZ) reported Wednesday that its comparable store sales for February grew 2.0 percent. Total net sales also increased 8.8 percent from last year to $48.4 million.

"Sales trends improved for the month driven in part by increased traffic as we cleared excess inventory carried over from the holiday season. As a result, product margins decreased in the period compared to the prior year period," Zumiez CEO Rick Brooks said in a statement.

A report released from the Conference Board on February 25 showed that U.S. consumer confidence has deteriorated by more than expected in February, with consumers expressing concerns about the short-term outlook for business conditions, jobs, and earnings.

The Conference Board said its consumer confidence index fell to 78.1 in February from a downwardly revised 79.4 in January. Economists had been expecting the index to edge down to 80.1 from the 80.7 originally reported for the previous month.

Looking ahead, apparel retailers are expected to sell-off winter merchandise on steep markdowns so as to make room for spring merchandise. Analysts' do not foresee consumer confidence gaining considerable momentum in the months ahead even though consumers believe the economy has improved.