JCPENNEY LOSSES WIDEN FOR FIRST QUARTER
J.C. Penney Company, Inc. has reported another quarter of losses for the first quarter, blaming the rough start of the year for much of its woes.
The company reported net sales of $2.7 billion in the first quarter of 2017 compared to $2.8 billion last year. Comparable store sales were 3.5 percent for the quarter.
For the first quarter, the company’s net loss was $180 million. This loss results from a $220 million cost for restructuring charges associated with its store closing announcement and voluntary retirement programs. The company was also hit with $17 million of benefit costs from the tax impact of its comprehensive income allocations and $4 million of benefit costs from primary pension plans.
Home, Sephora, Fine Jewelry and Salon all comped positively, and were the company’s top performing divisions during the quarter. Geographically, the Southwest and Southeast were the best performing regions of the country.
“We continue to make encouraging progress in the company’s competitive and financial position despite our top-line performance during the first quarter,” said Marvin R. Ellison, chairman and chief executive officer. “While February was a very challenging month for JCPenney and broader retail, we are pleased with our comp store sales for the combined March and April period, which improved significantly versus February. The recent sales trends, combined with the improvement in women’s apparel and our growth initiatives led by Sephora inside JCPenney, jcp.com and major appliances, provide us with the confidence to maintain our sales guidance for the full year.”
“Our investment in pricing and merchandising systems allowed us to deliver a 10 basis point increase in gross margin over last year, in light of the growth in appliances and e-commerce,” added Ellison. “Also, through our de-leveraging efforts and improved financial condition, we earned yet another credit rating upgrade this quarter. Our teams remain committed to executing on our strategic growth initiatives, and we are confident in our ability to drive sustainable growth and long-term profitability for JCPenney.”
