An Early Easter Gives Boost to Retailers’ Sales

Consumers who have pinched pennies in recent months loosened their purse strings in March, giving many of the nation’s largest general retailers a strong month. But Wall Street analysts, noting that sales lagged at other stores, warned Thursday that shoppers may return to their more cautious ways.

Store owners and analysts said the March sales increases--ranging from a high of 36% at mass merchandiser Wal-Mart Inc. to a low of 1.5% at industry leader Sears, Roebuck & Co.--came overwhelmingly in the last week of March. They said sales during April were likely to suffer because of the March surge.

Easter was last Sunday, and each year the holiday touches off shopping second only to Christmas. It accounts for a large portion of profits during retailers’ first quarter.

“The sales figures would have been substantially less if Easter had not been there, particularly for apparel,” said analyst Michelle Davis of Oppenheimer & Co.

“Traffic figures in the malls only picked up in the last week,” she said, referring to the days before Easter.

Analyst Janet Mangano at Josephthal & Co. said discounters and mass merchandise stores such as Wal-Mart showed particularly good results in March and in the year so far.

“The sales look good, mainly because of the early Easter,” said Jeffrey B. Edelman, a retail industry analyst with the investment firm Drexel Burnham Lambert Inc.

Others Fared Worse

But, he added, “They’re not as good as they appear.”

Some retailers reported very strong sales growth. For example, F. W. Woolworth Co. said its sales were up 29% last month, compared to March, 1987, sales.

But with consumers shopping earlier, “it makes comparisons (with 1987 figures) look better,” said Karen Sack, an analyst with Standard & Poor’s Corp.

Other stores, including Carter, Hawley, Hale Stores--owner of the Broadway--reported very sluggish sales.

Analysts said the stores with lackluster sales suffered from consumers’ general caution.

“The shift in the Easter calendar should have helped in many cases to lift sales, but we’re still in a very sluggish environment,” said Thomas Tashjian, an analyst with the investment firm Seidler Amdec Securities Inc. in Los Angeles.

“If you average out the March-April period combined, you’ll basically see sluggish numbers,” Edelman said.

Consumers have spent cautiously since early last year, and analysts predict that they will remain tight-fisted for at least the first part of 1988.

The rate of spending is crucial to a retailer’s bottom line, but economists watch it for signals of the nation’s economic health. Consumer spending accounts for two-thirds of the gross national product.

Sack said March started out badly, but many retailers saw sales pick up toward the end of the month.

Apparel retailers continued to have problems because of consumers’ continuing disenchantment with the stores’ latest lines, she said.

Sears was among the stores with problems with their fashion lines, Edelman said. The retailer said its sales for the first nine weeks of the fiscal year were up 1.9% over the same period a year earlier.

K mart Corp. said its sales rose 8.6% last month and 5.5% so far this year. Its comparable store sales--those from stores open at least a year and which provide a basis for comparison--were up 5.5% last month and 2.6% for the year to date.

The rapidly expanding Wal-Mart Stores said its sales rose 36% in March and 34% so far this year. Wal-Mart’s comparable store sales rose 15% last month and 14% for the first two months of fiscal 1988.

J. C. Penney Co. chalked up a 10.2% sales increase last month, and a 5.7% year-to-date gain. Its comparable store sales were up 9.3% last month and 4.9% so far this year.

Los Angeles-based Carter Hawley Hale said its sales fell 0.4% in March and 2.4% for the nine-week period.

Dayton Hudson Corp., owner of Target and Mervyn’s stores, said its sales were up 28.8% last month and 23.4% so far this year. Comparable store sales rose 10.5% in March and 5.4% for the first nine weeks.

May Department Stores, owner of J. W. Robinson and May Co. California stores, said its sales rose 12.1% in March and 6.5% so far this year. May’s comparable store sales rose 7.9% last month and 2.6% year-to-date.

Montgomery Ward & Co. said its March sales were up 10% and its year-to-date sales rose 4.3%. Comparable store sales rose 7.7% in March and 1.9% for the first nine weeks.

Woolworth said its year-to-date sales were up 20.9%.

The results reported Thursday were for department and apparel stores and general merchandisers. They do not include sales by auto makers or supermarkets.

MAJOR RETAILERS’ SALES IN MARCH

In millions Year % of dollars 1988 ago change Sears 2,660 2,620 +1.5 K mart 2,363 2,176 +8.6 J.C. Penney 1,183 1,073 +10.2 May Dept.Stores 948.6 846.4 +12.1 Federated* Dayton Hudson 1,020 792.3 +28.8 Wal-Mart Stores 1,530 1,124 +36.0 Woolworth ** 457.0 354.0 +29.0 Montgomery Ward 365.3 332.1 +10.0 Carter Hawley Hale 210.0 210.9 -0.4

* Did not report monthly sales.

** Excludes foreign sales.