JC Penney shares dive as sales fall short despite narrower-than-expected loss
J.C. Penney on Thursday reported quarterly revenue that fell short of analysts' expectations, sending shares down more than 10 percent in premarket trading, to just above a dollar a share.div > div.group > p:first-child">
Here's what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
- Losses per share: 52 cents, adjusted, vs. 56 cents expected
- Revenue: $2.65 billion vs. $2.81 billion expected
J.C. Penney said its loss in the fiscal third-quarter widened 21 percent to $151 million, or 48 cents per share, from a loss of $125 million, or 40 cents per share, a year earlier.
Excluding items, J.C. Penney said it lost 52 cents per share, which was less than the 56 cents per share loss expected by analysts surveyed by Refinitiv.
Net sales dropped 5.8 percent to $2.65 billion, and fell short of expectations of $2.81 billion.
Comparable sales dropped 5.4 percent for the quarter, compared to a 1.7 percent rise the same quarter last year.
J.C. Penney in October filled its vacant CEO role with Jill Soltau, the former CEO of Joann Stores. Soltau came after a string of executive departures, including former J.C. Penney CEO Marvin Ellison, who left for Lowe's, and CFO Jeffrey Davis.
"Our objective to put J.C. Penney back on a path to profitable growth is clear," said Soltau in a statement.
"While restoring J.C. Penney to sustained profitable growth will be a lengthy process, I understand the need for quick action. My commitment is that we will make sound, strategic decisions backed by data, and will always be rooted in delivering on our customers' wants and expectations."
Rivals like Macy's have been benefiting from a stronger economy, and have improved their performance by investing in their e-commerce operations. Meanwhile, J.C. Penney has struggled to navigate the new retail world. Those challenges have included not knowing who its key customers are and struggling to manage unsold and outdated merchandise that has piled up in its stores.
J.C. Penney said Thursday its inventory at the end of the quarter was $3.22 billion, down 5.4 percent from the same quarter last year.
It ended the quarter with $168 million in cash and cash equivalent, and more than $1.9 billion in liquidity.
The retailer also withdrew its earnings expectations for fiscal 2018, but updated its forecast for same-store sales, which it now expects to grow at a low-single digit rate. It expects to have positive free cash flow for the fiscal year.