Cold Puts Chill on Retail Sales

The coldest February since 1979 caused U.S. retailers' sales to grow at the slowest pace in three months as consumers delayed buying spring merchandise.

Wal-Mart, the world's largest retailer, said sales at stores open at least 12 months rose 0.9 percent, less than the company's forecast of 1 to 2 percent. Luxury stores and retailers with designer clothing, including Target, the second-largest U.S. discount chain, fared better, with sales surpassing analyst estimates.

Total U.S. same-store sales rose 2.5 percent, the smallest gain since November, the International Council of Shopping Centers said based on results from 53 retailers. Most retailers missed estimates after cold weather cut demand for shorts, dresses and other spring merchandise, while a snowy Valentine's Day in the Northeast kept shoppers home.

"We hate to hear weather as an excuse, but I think it was pretty legitimate this month," said Lori Wachs, who helps manage $100 billion, some of it related to retail, at Delaware Investments in Philadelphia. Retailers "are going to have a lot of ground to make up in March," she said.

Wal-Mart shares were down 5 cents, at $47.88. Target gained $1.09, to $61.69. The Standard & Poor's 500 Retailing Index added 1.1 percent.

The council of shopping centers had expected February sales to rise 2.5 to 3 percent. The council's chief economist, Michael Niemira, said sales would gain 3 percent this year, the slowest pace in at least three years. March sales should increase 4 percent, boosted by Easter buying, the council said.

February is the second-slowest sales month of the year, representing about 6.2 percent of the annual total, Niemira said. Retailers typically clear out their winter stock of coats and sweaters in January and by February have outfitted stores with spring merchandise.

Sixty percent of retailers reported sales that trailed estimates, compared with the long-term average of 42 percent, according to Retail Metrics of Swampscott, Mass. Both teen and specialty apparel retailers' sales missed estimates, and their performance trailed those of department stores and discounters.

Sales at Costco, the largest U.S. wholesale club, rose 4 percent, compared with predictions for a 5.1 percent gain.

Federated Department Stores' sales advanced 1.2 percent, compared with an expected increase of 2.6 percent. Gap, the largest U.S. apparel chain, said sales dropped 4 percent. Analysts estimated a decline of 4.7 percent. Limited Brands sales rose 3 percent, missing estimates for a 3.7 percent increase after Valentine's Day weather hurt sales at Victoria's Secret and Bath & Body Works. Gap shares fell 0.2 percent, and Limited added 1.9 percent.