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WRAPUP 1-Costco, Victoria's Secret April sales gains miss forecasts
May 9, 2013 / 12:30 PM / 4 years ago

WRAPUP 1-Costco, Victoria's Secret April sales gains miss forecasts

* Analysts: 4.3 pct same-store sales gains for top 13 chains

* Costco, L Brands miss estimates

By Phil Wahba

May 9 (Reuters) - Costco Wholesale Corp and Victoria’s Secret parent L Brands Inc reported smaller-than-expected sales gains in April, when consumer mood swooned on concerns about the job market recovery.

Costco reported a 4 percent gain in sales at stores open at least a year, slightly less than expected because of sharply lower gas prices compared with a year ago. Still, the warehouse club operator said sales of food and consumer electronics were good.

L Brands same-store sales were up 2 percent, but sales were disappointing at all its major brands, including Bath & Body Works, and the company missed forecasts of a 4.6 percent again.

Analysts expect 13 U.S. retailers who still report monthly sales, including T.J. Maxx parent TJX Cos and Gap Inc , to post a 4.3 percent rise in same-store sales for April, according to Thomson Reuters, better than the 0.8 percent gain a year earlier.

April sales got a boost from Easter’s timing in late March. But at the same time, the weather was cool in much of the country, delaying many shoppers’ purchases of spring clothing.

Janney Capital Markets analyst Adrienne Tennant said in a note this week that retailers were more aggressive in offering discounts in April, but things eased at the end of the month, suggesting stores had not over-ordered, and making it likely they will avoid panicked markdowns.

Despite what turned out to be strong hiring in April, consumer morale lagged the news. U.S. consumer sentiment dipped last month as Americans remained concerned about their employment and financial prospects, a Thomson Reuters/University of Michigan survey late in April found.

U.S. employment rose at a faster pace than expected in April and hiring was much stronger than previously thought in the prior two months, while the U.S. stock market indices marched to all-time highs.

Teen retailers The Buckle and Zumiez Inc each reported much better-than-expected April sales on Thursday.

Last week, drugstore chain Rite Aid Corp reported same-store sales fell 4 percent in April, largely because of many lower cost generic drugs coming to market in the last year. Larger rival Walgreen Co reported a modest 1.2 percent rise, hurt by a drop in sales of general merchandise.

Other chains expected to report later on Thursday include TJX, Gap and Ross Stores Inc. As previously announced, TJX and Ross will no longer report monthly sales after the April report.

That will leave 11 U.S. chains reporting monthly sales, down from a peak of 68 in 2006. In the years since, big names such as Macy’s Inc, Wal-Mart Stores Inc and Best Buy Co Inc have dropped out of the same-store sales index.

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