JCPenney Narrows Q2 Losses, Footwear A Top Category

J.C. Penney store
JCPenney storefront
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The second quarter continues to look up for department stores.

J.C. Penney Co. Inc. today added its name to the list of better-than-expected performances from the segment, joining Macy’s Inc., Kohl’s Corp. and Nordstrom Inc., which reported Thursday.

JCPenney narrowed its Q2 reported losses 52 percent, to $56 million, or 18 cents per diluted share, from $117 million, or 38 cents per diluted share in the comparable period. Adjusted losses per share improved 88 percent, to a loss of 5 cents per share, compared to a loss of 40 cents per share last year. Market watchers had expected the firm to post a net loss of 15 cents per share.

We are pleased with the sequential improvement we achieved throughout the second quarter, and our solid performance across all key metrics is encouraging,” said Marvin Ellison, JCPenney chairman and CEO, in a release. “We exceeded our profitability expectations, achieving an $85 million or 59 percent increase in EBITDA to $229 million for the quarter. We are continuing to win market share and improve the bottom line of our business thanks to the commitment and hard work of our over 100,000 associates.”

The firm’s revenues advanced 1.5 percent year-over-year, to $2.9 billion, in line with Wall Streets’ expectations. Comparable store sales also increased 2.2 percent.

Meanwhile, footwear was among the company’s top-performing merchandise categories, Ellison said during the Q2 conference call.

Our footwear and handbag business delivered strong comp sales performance during the quarter,” Ellison said. “Our expansion of women’s shoes and our relocation of men’s shoes continuing to reap benefits … We’ve gone back and converted the majority of our women’s shoe area to open sale. Based on this change, we save payroll and delivered accelerated sales results in women’s footwear.”

JCPenney reaffirmed its full-year guidance.

“We are excited about the initiatives we have in place to drive incremental growth in the back half of the year with our appliance rollouts, new Sephora locations, center core refreshes, in-store [dot-com] fulfillment and our chain-wide rollout of buy online, pickup in store same day,” Ellison said.

As of 10:55 a.m. ET, the company’s shares had gained 4 percent, to $10.35.