FOR IMMEDIATE RELEASE

MEDIA CONTACT: 

Bill Kirk, CEO Weather Trends Intl. (O) 610-807-3585 (C) 484-903-6887 e-mail bkirk@wxtrends.com

MARKETING / SALES CONTACT:

Billy Martin, VP Marketing Weather Trends Intl. (O) 609-678-0633  email cooltools@wxtrends.com

BETHLEHEM, PA 5 JUNE 2008:  The 4-week retail calendar May (5/4 – 5/31) trended the coldest in 6 years and wettest in 4 and showed the 3^rd greatest one-month drop in May national temperatures in 114 years.  80% of the U.S. trended colder than last year and a significant 61% also trended much colder than what is typical for this time of year – a big negative factor for apparel sales and Department Stores who were the laggards in today’s results.

The Northeast and the North Central U.S. by far had the coldest conditions with Chicago showing a 10.2F drop in year-over-year May temperatures, a 100 year extreme event.  The number of hot days over 90F were down a whopping 97% in these regions resulting in significant excess inventories necessitating steep markdowns for items like A/C, fans, beverages/beer, pool chemical/water toys, sorts and camping equipment, exterior paint, suncare, first aid/band aids and especially apparel and footwear categories. The steeper markdowns and government rebate checks did help the discounters and clubs.

The two major May U.S. holidays didn’t help as the week-prior to Mother’s Day was the 2^nd coldest in 16+ years and the week prior to Memorial Day was the #1 coldest in 16+ years – big negatives for many seasonal apparel items with reports from retailers of 10% to 30% YOY declines in many apparel and seasonal categories.

Rainfall and severe weather were secondary big negatives with national rainfall up 20% over last year.  Tornadoes were particularly widespread and disruptive in the Central States with 547 reported, up 218% over last year.  Home Centers can benefit from damaging weather so Home Depot, Lowes, Menards will benefit in the region.

The U.S. was not alone on the cold/wet conditions as the G-20 countries have the 12^th straight month to trend much colder than last year and the 2^nd wettest in 16+ years.  Globally, May was the coldest in 11 years for the G-20 countries which again is a negative consumer influence for seasonal purchases.  The lone favorable hot period was the 16^th – 20^th when 100s of record hot temperatures were set in the West but it was followed by more cold weather and not enough to save the month for apparel retailers.  The bright spot was the South Central U.S. where temperatures were much warmer than last year and what is typical for this time of year.  The number of hot 90F days was up a whopping 498% over last year, especially in Texas.  This is very favorable for hot weather categories and stronger retail sales in the region.

“Our retail industry same-store sales research of the past 24 years show about a 1.8% decline in overall industry SSS from a favorable warm/dry May (SSS average +4.7%) compared to a cold/wet May (SSS average +2.9%) like we had this year.  This combined with gasoline prices trending 26% higher than last year in not surprising that retail sales were on the lower end of the scale but apparel retailers and Department Stores faired much worse in the -5% to -7% range.  Companies that ignore the significance of weather in their business and it’s statistically proven influence on consumer behavior to buy close to need and it’s influence on the overall economy will always be surprised by weak sales as they were again this May”, said Bill Kirk, CEO Weather Trends International.  “Department Stores and apparel retailers shouldn’t panic just yet, as they’ll be surprised on the positive side in June with a couple scorching heat waves early and around the July 4^th holiday when some areas of the U.S. will have the hottest conditions in 14 years driving exceptional demand for Summer items, including apparel and overall SSS.” Added Kirk.

The retail story for Spring 2008 is so goes the weather – so goes retail sales.  Cold/Snowy March and coldest Easter in 16 years =  2^nd worst retail sales in 24+ years, Warmer April = sales soar twice Wall Street expectations, cold/wet May – bad news for the purely apparel folks, better for those who had more to offer. 

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