JCPenney ends year on a high

US department store JCPenney has recorded a 2.6 per cent increase in same-store sales for its fourth quarter, rescuing full-year sales to a negligible 0.1 per cent rise.

Total net sales for the 14 weeks ended February 3 increased 1.8 per cent to $4.03 billion compared to $3.96 billion for the 13 weeks ended January 28 last year. Comparable sales increased 2.6 per cent on the same 13 week basis as the fourth quarter last year.

Jewellery, home, Sephora, footwear and handbags were the company’s top performing categories during the quarter.

Adjusted net income was $179 million, down from last year’s $202 million.

Total net sales decreased 0.3 per cent to $12.51 billion for the full year, compared to $12.55 billion last year. The company said the slight decline in total net sales was primarily due to store closures last year, most of which closed in the first half of the year, and was partially offset by incremental sales for the 53rd week.

JCPenney reported a net annual loss of $116 million, compared to net income of $1 million last year. This reduction was driven primarily by restructuring charges associated with the fiscal 2017 store closures and voluntary early retirement program.

Chairman and CEO Marvin R Ellison, said the company was encouraged by the results for the fourth quarter and full year.

“Through the hard work and dedication of the entire JCPenney team, we delivered our second consecutive year of positive adjusted earnings. For 2017, we improved adjusted earnings per share by 175 per cent, reduced our outstanding debt levels by over $600 million and generated over $200 million of free cash flow.

“During the fourth quarter, we delivered our strongest positive sales comps and achieved our largest gross margin improvement for the year.”

Ellison said in the year ahead the company will intensify its market share efforts in appliances, mattresses and furniture, while continuing to modernise its apparel assortment and omni-channel offer.

“Our strategy and plan is clear and consistent, and we remain focused on two critical factors – to operate the business for growth and deliver profitable earnings.”


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