Easter helps, but comps still lag
April 21, 2003,
With a delayed Easter holiday season finally getting under way, same-store retail sales staged a strong recovery after five straight weeks of decline, climbing higher by 2.0 percent during the first week of April, but still fell short of the targets set for both department stores and discounters.
Discounters, predictably, showed strength, with a 5.6 percent increase coming close to a target of 5.8 percent. But full-price department stores remained weak, with sales falling by 3.8 percent, worse than a forecast drop of 1.8 percent.
"The sharp rise in our model's year-on-year growth rates from the final week of March reflects the transition from the negative to the positive side of the Easter shift," said Redbook analyst Catlin Levis. "Easter falls three weeks later this year than last, so the expected bulge in sales around the holiday will be accounted for in April, rather than March. This will make April appear stronger than April of last year — and also much stronger than March of this year since March was negatively affected by the shift."
Levis noted, "As retailers enter the final month of their first quarter, results of the first week were below plan in the aggregate although there was variation among individual companies. This was partly due to differing weather conditions across the country where warmer temperatures over the weekend have helped to stimulate sales."
Breaking sales out by merchandise segment, Levis said, "The Easter effect became evident in specific holiday-related categories, such as Easter-theme toys, and also reportedly in sales of children's shoes and apparel. Basic consumable items were reported to be solid. Retailers also reported strength in furniture and home improvement categories."
On a regional basis, Levis reported, "Business was generally better in the Mid-Atlantic followed by the Northeast.
Redbook Retail Sales Average
First week of April
|*Including chain stores and traditional department stores.
Source: Redbook Retail Sales Average, a unit of Instinet, a Reuters company.