Retailers Find Soft Sales in February
February sales were soft for retailers including Zumiez Inc., The Buckle Inc. and Cato Corp.
Mall-based action-sports store Zumiez reported its same-store-sales results and its fourth-quarter earnings for the year on March 14.
Same-store sales for the retailer decreased 3.8 percent in February while its net sales for that month were down 3.1 percent. For the fourth quarter ending Feb. 2, net sales declined 1.2 percent to $304.6 million from $308.2 million.
The Lynnwood, Wash.–based company also provided guidance for its upcoming quarter. It forecast that same-store sales for the period will range from negative 2 percent to flat with net sales projected to be in the range of $202 million to $206 million.
But Zumiez executives remain optimistic about the company’s future. They said it is on track to open 14 new stores around the globe in fiscal 2019. Rick Brooks, Zumiez’s chief executive officer, said its success is based on a nimble retail model that features some fulfillment tasks at retail stores, not just warehouses.
“Our localized fulfillment strategy has provided a retail model with a singular cost structure that we can more easily leverage to drive operating margin expansion,” he said in a statement.
Also in negative territory was the mall-based denim store The Buckle, which reported a 6.8 percent dip in same-store sales in February compared to the same period last year. February net sales for the chain, based in Kearney, Neb., declined 7.2 percent to $59.4 million compared to $64 million from the previous February.
Value-priced fashion-apparel retailer Cato Corp., based in Charlotte, N.C., saw a 10 percent decline in its February same-store sales with net sales sliding 12 percent to $59.1 million from $67.2 million last year.
John Cato, the retailer’s chairman, president and chief executive officer, said that February same-store sales were well below the company’s expectations. In February, the retailer closed three stores. Its retail fleet now numbers 1,351 outposts.
Jeff van Sinderen, a senior analyst at B. Riley FBR, said winter’s unfavorable weather affected both traffic and a general demand for spring merchandise.
“Timing of tax refunds and the calendar shift also favor a later progression toward seasonal peak sales volumes this year,” he wrote in an email. “For numerous retailers, February was a tough month. That said, business has started to improve in March, especially in warmer-weather markets, and we would expect a solidly positive April overall.”