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PREVIEW-U.S. retailers faced limp February sales

 * What: February same-store sales seen down 1.3 pct
 * When: March 4-5
 * Feb may trump Jan but not a sign of turnaround
 NEW YORK, March 3 (Reuters) - Major U.S. retailers are
expected to post lower February same-store sales later this
week, as shoppers remained stubbornly thrifty and a dire
recession showed no signs of improving.
 Though sales may be slightly better than in January, top
retailers are still bracing for a stormy 2009. U.S. companies
from Wal-Mart Stores Inc WMT.N to Macy's Inc M.N are due to
report their monthly sales data this week, with most issuing
results on Thursday.
 "We would not read much into an improvement" in February
compared with January, said Retail Metrics President Ken
Perkins.
 "The macro headwinds that consumers and retailers are facing
right now are so stiff that we feel there are still more
negative comps to come as we progress through the first half of
this year," he said.
 Retailers are two months out of the 2008 holiday season,
which turned into the worst in nearly four decades as sharp
cutbacks in consumer spending scathed sales at most companies.
 The Dow Jones Retail Index .DJUSRT has tumbled about 28
percent in the past year.
 Same-store sales fell 1.8 percent in January -- the
second-weakest monthly performance since Thomson Reuters started
tracking the data in 2000.
 For February, analysts expect retailers to post a decline of
1.3 percent in same-store sales, according to Thomson Reuters.
Excluding Wal-Mart, the world's largest retailer, same-store
sales are expected to be down 5.1 percent.
 Slightly better weather and new spring merchandise in stores
may have helped sales a bit in February, analysts said. It was
the warmest February since 2005, according to weather tracking
firm Planalytics.
 While February is usually not a key month given fewer days
and its place between the post-holiday and early spring shopping
periods, the month could show how willing shoppers are to spend
even without the motivation of gift-giving.
 CLOSE EYE ON INVENTORY
 Department stores such as Macy's, and apparel retailers like
Gap Inc GPS.N and Abercrombie & Fitch ANF.N, likely suffered
the deepest cutbacks in February, providing fresh evidence that
consumers are buying only basics like food.
 Apparel retailers are expected to post an 8.6 percent
same-store sales decline, while department stores faced a 10.1
percent drop in what Saks Inc SKS.N Chief Executive Steve
Sadove recently called the most challenging downturn that the
company has faced in its 84-year history.
 As they hunker down, several retailers have kept a close eye
on inventories, which Thomas Weisel Partners analyst Liz Dunn
said was a good move.
 "Conservative inventory planning is prudent, and the
retailers we have heard from thus far have generally managed
inventories to sales trends," Dunn said in a note.
 Until the economy improves, retailers must keep a tight lid
on inventory to avoid last-minute sales that could evaporate
margins, analysts said. Saks, for instance, is targeting a 20
percent decrease in inventory for 2009.
 But there is no sure-fire way to tell how shoppers will
spend or when the economy will turn.
 Last month, Wal-Mart scrapped its monthly sales forecasts,
pointing to unpredictable consumer habits. Others like Macy's,
J.C. Penney JCP.N and Kohl's Corp KSS.N have warned that
their troubles will dog them through 2009, while Target Corp
TGT.N said earnings in the first half of the year would be
below year-earlier levels.
 Kohl's, a mid-priced apparel and home goods retailer,
expects February results to be better than the 6 to 8 percent
decline it foresees in first-quarter same-store sales. March
will match that range, while April will be at the "negative
end," it said.
 Macy's expects a same-store sales decline of 6 to 8 percent
for the full year.
 As consumers face mounting job losses, tighter credit and
weak home values, hopes for the year are fast fading, Perkins
said.
 "When you look at today's landscape, it is very difficult to
picture all that being settled and sorted out by the end of the
year."
 (Reporting by Aarthi Sivaraman, editing by Matthew Lewis)




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