JCPenny Posts Loss More Than Expected; Shares Drop
August 11 2017 - 9:42AM
Dow Jones News
By Justina Vasquez
J.C. Penney Co. shares plummeted as the retailer's latest
earnings report failed to ease investors' concerns any more than
did than Thursday's results from its peers.
The department-store operator's shares were down 23% in
premarket trading Friday, after it reported a steeper loss than
analysts had expected for the three months ended July 29.
Sales at stores open at least a year fell 1.3%, better than the
3.5% decline in the previous quarter, a pattern similar to that
reported by Macy's Inc. and Kohl's Corp. on Thursday. Foot traffic
has steadily slowed at brick-and-mortar stores as shoppers
increasingly turn to Amazon.com Inc. and e-commerce to spend their
dollars.
J.C. Penney Chairman and Chief Executive Marvin Ellison said
that although "broader retail remains challenged," improved
performance in apparel sales, especially of children's clothing,
left it optimistic.
Earnings were dragged down by the 127 store closings and
inventory liquidation during the quarter. The company posted a net
loss of $62 million, or 20 cents per share, compared with $56
million, or 18 cents per share, a year earlier. On an adjusted
basis, the loss amounted to $28 million, or 9 cents per share,
compared with $16 million, or 5 cents per share, a year
earlier.
Analysts had expected an adjusted loss of 5 cents per share.
Revenue edged up in the quarter to $2.96 billion, from $2.92
billion a year earlier. Analysts had expected revenue of $2.84
billion.
Mr. Ellison said strong early back-to-school sales in August
boded well for the second half of the year, keeping the company on
track to meet expectations. J.C. Penney reaffirmed its full-year
guidance, including earnings per share of $0.40 to $0.65, and
comparable store sales of negative 1% to positive 1%.
J.C. Penney said its top-performing divisions in the quarter
were home, fine jewelry, footwear and handbags, Sephora and salon.
Last month, the company announced it would add a toys division,
aiming to cater to children by the start of the holiday season.
Shares were down 23% premarket to $3.65, down 49% from a year
ago.
Write to Justina Vasquez at justina.vasquez@wsj.com
(END) Dow Jones Newswires
August 11, 2017 09:27 ET (13:27 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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