NEW YORK — With the weather outside frightful and the fire inside delightful, shoppers stayed home last week, driving down comparable-store sales for major chains.
This story first appeared in the February 25, 2003 issue of WWD. Subscribe Today.
The blizzard that blanketed much of the Eastern half of the U.S. on Presidents’ Day weekend, and the digging out in the days after, contributed to lowered February comp expectations at Federated Department Stores Inc. and J.C. Penney Co. Inc. Other firms were also pressured, both on the top line and in the price of their shares, as the storm took away whatever momentum the month may have had.
Federated’s comps during the third week of its fiscal month further depressed expectations for a down month. The parent of Bloomingdale’s and Macy’s, among others, is now looking for sales at stores open more than a year to fall 7.5 to 8.5 percent in February. Through Valentine’s Day, Federated had been on track to reach its forecast of a 4 to 5 percent drop.
Last week was the fourth and final week of Penney’s fiscal month. Once it was over, Penney’s reduced its February comp projection for its department stores to a decline of 2 to 3 percent. Previously, the retailer had been looking for a flat performance.
With its larger base, Wal-Mart Stores Inc. was better able to weather the storm. After the third week of its fiscal month, the discounter said its U.S. comps overall were tracking toward the low end of its projection for a 2 to 4 percent upswing. The Wal-Mart division’s February same-store sales were headed toward the low end of its expected 3 to 5 percent rise.
“This week was impacted by the snowstorm in the Northeast over the weekend and on Presidents’ Day,” said a spokeswoman on a recorded call. “However, as the week progressed, sales returned to prior levels. Average ticket drove the comp increase for the week. Traffic was negatively impacted by the snowstorm.”
Meanwhile, Wal-Mart, already the world’s largest company, was proclaimed the most admired firm in the U.S. by Fortune magazine.
Target Corp., reporting on the week after the close of the market, said comps last week and for the first three weeks of the month were trending below its plans for a flat to up 2 percent performance. Men’s apparel was among the weakest product categories at the Target division so far this month.
Last week’s whiteout conditions contributed to a flurry of selling Monday on Wall Street. J.C. Penney Co., which has managed to buck many of the industry’s negative trends recently, was hardest hit with a 95 cent, or 4.7 percent reduction in the price of its shares to $19.39. Federated’s stock similarly sunk 76 cents, or 3 percent, to $24.82, while shares of Wal-Mart were off $1.26, or 2.6 percent, to $47.64. Target gave back 25 cents, or 0.9 percent, to close at $28.23. All four issues trade on the New York Stock Exchange.
The Blue Chip Dow Jones Industrial Average, of which Wal-Mart is a component, sank 159.87 points, or 2 percent, to 7,858.24, while the Standard & Poor’s 500 was off 15.59 points, or 1.8 percent, to 832.58. The S&P Retail Index fell 4.91 points, or 1.9 percent, to 252.01.