J.C. Penney Profits More Than Double
J.C. Penney Co. reported that its first-quarter net income more than doubled as the department store operator benefited from sales improvements across most types of merchandise and tighter inventory.
The chain, however, offered a muted profit outlook.
The chain on Friday posted net income of $60 million, or 25 cents per share, for the quarter ended May 1. That compares with $25 million, or 11 cents per share, in the year-ago period.
Total revenue rose 1.2 percent to $3.93 billion. Revenue at stores opened at least a year rose 1.3 percent. The measure is considered a key indicator of a retailer’s health.
Analysts surveyed by Thomson Reuters expected 25 cents per share on revenue of $3.93 billion.
“The first quarter marked a solid start to the year for J.C. Penney as customers responded well to the steps we have taken to reinforce our style authority with fashion sensibility, head-to-toe looks and promotions that made what we had to offer highly affordable for America’s families,” Myron E. Ullman III, chairman and CEO, said in a statement.
Penney said six of the seven merchandise divisions had revenue gains. The strongest areas were men’s, shoes and handbags and children’s.
Like many department stores, Penney has been expanding its assortment of exclusive brands, including a new line called Olsenboye, which made its debut this spring. The line is part of a partnership with actresses Mary-Kate and Ashley Olsen.
Starting this fall, Penney will be the only U.S. retailer to sell Liz Claiborne and Claiborne women’s wear, along with its Liz & Co. and Concepts by Claiborne brands.
Penney, based in Plano, Texas, said it expects revenue at stores open at least a year to rise between 2.5 percent and 3 percent. It estimates that earnings per share between 10 and 13 cents per share. Analysts expect 13 cents per share
For the full year, Penney said it expects that earnings per share will be $1.64, a penny below what Wall Street analysts had expected.
ANNE D'INNOCENZIO, AP Retail Writer NEW YORK