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JCPenney reports Q1 financial results
15 May '08
3 min read
Mr. Ullman said, "We recognize that it is more critical than ever to provide merchandise innovation, smart prices and a great shopping experience that clearly differentiates us from the competition. To this end, throughout the course of 2008 our customers will see an exceptional array of new brands, such as Decree and Fabulosity in juniors and Linden Street and Dorm Life in home.
Together with the enhanced service our Associates are providing under our new CustomerFIRST initiative, these innovations will reinforce why JCPenney should be their first choice and allow us to increase market share when the environment improves."
Operating Performance:
During the first quarter, total sales decreased 5.1 percent. Comparable store sales decreased 7.4 percent and were at the favorable end of the Company's revised guidance for a high-single digit decrease. Since the first quarter of last year, the Company has opened 54 new and relocated stores, including 11 stores opened in this year's first quarter.
Although sales weakness was broad-based in terms of merchandise categories and geography, the best merchandise results were in men's apparel and family footwear, with continued softness in most home categories and fine jewelry.
Geographically, the best performances were in the northeast and central regions. Internet sales through www.jcp.com increased 8.7 percent on top of an 18 percent increase in last year's first quarter.
For the quarter, operating income declined 360 basis points to 6.0 percent of sales, reflecting pressure on both gross margin and SG&A expenses. Gross margin decreased by 150 basis points to 40.0 percent of sales, which reflects the soft sales environment and pricing action taken to clear merchandise in season. SG&A expenses were well-managed, but were not leveraged.
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Together with the enhanced service our Associates are providing under our new CustomerFIRST initiative, these innovations will reinforce why JCPenney should be their first choice and allow us to increase market share when the environment improves."
Operating Performance:
During the first quarter, total sales decreased 5.1 percent. Comparable store sales decreased 7.4 percent and were at the favorable end of the Company's revised guidance for a high-single digit decrease. Since the first quarter of last year, the Company has opened 54 new and relocated stores, including 11 stores opened in this year's first quarter.
Although sales weakness was broad-based in terms of merchandise categories and geography, the best merchandise results were in men's apparel and family footwear, with continued softness in most home categories and fine jewelry.
Geographically, the best performances were in the northeast and central regions. Internet sales through www.jcp.com increased 8.7 percent on top of an 18 percent increase in last year's first quarter.
For the quarter, operating income declined 360 basis points to 6.0 percent of sales, reflecting pressure on both gross margin and SG&A expenses. Gross margin decreased by 150 basis points to 40.0 percent of sales, which reflects the soft sales environment and pricing action taken to clear merchandise in season. SG&A expenses were well-managed, but were not leveraged.
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J. C. Penney Company Inc
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