Tags: jc penney | department | stores | retail

JC Penney Joins Fellow Department Stores in Retail Malaise

JC Penney Joins Fellow Department Stores in Retail Malaise
(AP)

Friday, 12 May 2017 08:35 AM

Welcome to the club, J.C. Penney Co.

Same-store sales slid 3.5 percent last quarter, the department store company said Friday, sending the shares down as much as 12 percent in early trading.

Analysts had estimated an 0.7 percent drop, according to Consensus Metrix.

The earnings follow disappointing results from rivals Macy’s Inc. and Kohl’s Corp., as well as upscale players like Nordstrom Inc. J.C. Penney Chief Executive Officer Marvin Ellison has been trying to set the retailer apart from peers by expanding the company’s partnership with Sephora and increasing its assortment of high-price items, like appliances. The retailer is also focusing on services like salons that require shoppers to come into stores.

The company posted revenue of $2.71 billion in the quarter that ended April 29, missing the average $2.77 billion projection of analysts. It did report a surprise profit of 6 cents a share, excluding some items. Analysts had estimated a loss of 21 cents.

The shares fell as low as $4.63 in premarket trading in New York. J.C. Penney had dropped 36 percent this year through Thursday.

Annual Forecast

J.C. Penney maintained its forecast for same-store sales this year ranging from a 1 percent decline to a 1 percent gain. It also reiterated that earnings excluding some items will be 40 cents to 65 cents a share. Analysts estimated 46 cents.

The company is delaying its planned closure of some 140 stores by about a month after sales picked up in the locations. The stores will be shuttered on July 31, compared with an earlier goal of mid-June, spokeswoman Daphne Avila said last month.

J.C. Penney announced the plans to scale back its store fleet in February, echoing similar intentions by Macy’s and Sears Holdings Corp. The retailer said at the time it would take a charge of about $225 million related to the moves in the first half of this year. The cutbacks, which also include shutting two distribution centers, are meant to save about $200 million a year.

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J.C. Penney maintained its forecast for same-store sales this year ranging from a 1 percent decline to a 1 percent gain.
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2017-35-12
Friday, 12 May 2017 08:35 AM
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