JCPenney 1Q earnings down, expects 2Q loss

PLANO, Texas JCPenney reported earnings per share of 11 cents per share for the first quarter ended May 2, compared to 54 cents per share in last year’s first quarter. Net income for this year’s first quarter was $25 million versus $120 million last year.

“Our performance in the first quarter reflects the strides we made in communicating to customers the style, quality and value of our offerings. This helped drive better-than-expected sales throughout the quarter and, along with alignment of inventory levels to current sales trends, led to improved gross margins. Combined with our continued success in controlling expenses, we achieved flow through to bottom line results that improved steadily versus our outlook at the beginning of the quarter,” said Myron Ullman, III, chairman and CEO of JCPenney.

Total sales in the first quarter decreased 5.9% compared to last year, while comparable-store sales decreased 7.5%. The strongest merchandise result was in women’s apparel and, geographically, the best performance was in the southwest region of the country. The weakest results were in fine jewelry and in the Southeast region.

JCPenney expects total sales in the second quarter to decrease 7% to 10% and comparable-store sales to decrease 9% to 12%. The company expects a loss in the range of 15 cents to 25 cents per share.