Bad weather puts the chill on many companies
Thursday, February 27, 2014
Storms outside can freeze up economic growth.
Federal Reserve Chair Janet Yellen says the central bank will be watching to see if a recent slowdown in consumer spending and job growth is part of a broader trend or a temporary situation caused by this winter’s severe weather.
Just like frozen pipes can slow the flow of water, cold weather and storms can keep shoppers at home and cramp their spending.
A number of companies have blamed this season’s snow and freezing temperatures for putting the ice on their own sales:
• Wal-Mart Stores Inc. closed more than 200 of its stores during its fourth quarter. Its profit fell 21 percent and it gave a subdued forecast for the year.
• Macy’s Inc. also closed stores because of winter storms. At one point during January, about 30 percent of its Macy’s and Bloomingdale’s stores were shut.
• Home Depot Inc. estimated that it lost $100 million in the month of January because of bad weather. The home improvement retailer has benefited from a recovering housing market but a slowdown in November and December has hampered its business.
• McDonald’s Corp.’s sales at established U.S. stores fell 3.3 percent in January, hurt by bad weather.
— Columbia Sportswear Co. was one of the rare companies that benefited from a cold winter. The seller of Columbia jackets, Sorel boots and Mountain Hardwear sleeping bags said revenue rose 6 percent in its latest quarter after being hurt by mild winters in the past two years.
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