J.C. Penney Slashes Q2 Loss as Sales Gain
PLANO, Texas-With net sales increasing for the second quarter in a row, J.C. Penney reported a net loss of $172 million in its fiscal second quarter, compared to a net loss of $586 million in the second quarter of last year.
Net sales gained 5.1 percent to $2.8 billion in the quarter, which ended on Aug. 2. This included a same-store sales increase of 6 percent, marking the third quarter in a row that same-store sales trended upward. Home was one of the leaders in the department-store retailer's sales charge in the quarter, along with women's and men's apparel and accessories, and fine jewelry.
Myron Ullman III, J.C. Penney's CEO, said, "Our turnaround initiatives continue to produce improved financial results. In the second quarter, we gained additional market share while significantly increasing gross margin in a highly competitive promotional environment."
Gross margin did indeed take a leap in the quarter, picking up 646 basis points to finish at 36 percent. Selling, general and administrative expenses were cut by 6 percent in dollars and 409 basis points as a percentage of sales, to 34.4 percent.
Based on these results, J.C. Penney said it expected same-store sales to increase by the mid-single digits in both the third quarter and for the fiscal year as a whole. "With our unique assortment of powerful private brands, key national brands and exclusive attractions--all at prices customers can afford--we expect to continue driving profitable sales this back-to-school season," Ullman said.