Easter effect to benefit March results

Target is poised this month to report its largest same-store sales increase in several years, but the gain is due largely to the timing of Easter. Expectations for March comps are in the mid-to-upper single-digit range, as Easter falls on April 4 this year, which means virtually all of the sales associated with the holiday will fall into the five-week March reporting period ending April 3. In 2009, Easter fell on April 12, so a portion of Easter related sales fell into the April reporting period.

The shifting of seasonal sales from one month to another can have a big impact on comparisons against the prior year, and in Target’s case it expects the shift to cause April comps to decline in the low mid-single digits. However, taking the March and April periods together, the company is looking for an increase in the low-single digits similar to the 2.4% increase it experienced in February. It helps that Target was up against an easy comparison the prior year, as February 2009 comps declined 4.1%. However, the company contends its strategies continue to gain traction as customer traffic and average transaction sizes continue to show increases.