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Reuters
Published
Nov 13, 2015
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J.C. Penney sales beat, helped by home goods and Sephora

By
Reuters
Published
Nov 13, 2015

J.C. Penney Co Inc reported better-than-expected quarterly net sales and a smaller-than-expected loss, helped by demand for home products and footwear and a strong performance by the growing number of Sephora beauty shops in its stores.

But the company's shares fell as much as 11 percent in premarket trading after it maintained its same-store sales forecast for the year despite achieving the biggest gain in quarterly comparable sales in more than nine years.


Penney's results capped a volatile week for U.S. department stores ahead of the all-important holiday shopping season, a period that historically has accounted for about a third of their annual sales and almost 40 percent of earnings.

Macy's Inc and Nordstrom, whose customers tend to be more affluent than Penney's, both cut their full-year forecasts this week after reporting disappointing results.

However, Kohl's Corp, which competes more closely for the same shoppers as Penney, reported better-than-expected profit and sales.

J.C. Penney's gross margin rose by 70 basis points to 37.3 percent, helped by improved clearance and promotional selling margins as well as supply chain efficiencies. The company maintained its margin forecast for the year ending January.

The retailer's net loss narrowed to $137 million, or 45 cents per share, in the third quarter ended Oct. 31, from $188 million, or 62 cents per share, a year earlier.

Excluding items, the company lost 47 cents per share.

Net sales rose 4.8 percent to $2.90 billion.

Analysts on average had expected a loss of 55 cents per share and revenue of $2.88 billion, according to Thomson Reuters I/B/E/S.

Penney said earlier this week that its same-store sales in the quarter rose a more-than-expected 6.4 percent.

The company's shares were down about 3 percent before the opening bell. Up to Thursday's close of $8.79, the stock had risen more than 35 percent this year.

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