JC Penney sales down 8.7 percent in FY 2013

REPORT_ JC Penney Company has announced that for the full year 2013, its comparable store sales decreased 7.4 percent, whereas total sales decreased 8.7 percent for the year. Internet sales through jcp.com grew 59 million dollars to 1.08 billion dollars for the year, increasing

5.8 percent over last year.

For the fourth quarter, JC Penney reported net sales of 3.78 billion dollars compared to 3.88 billion dollars in the fourth quarter of 2012, which included the additional 53rd week. Comparable store sales rose 2 percent for the quarter, which represented a sequential improvement of 680 basis points when compared to the third quarter of fiscal 2013. Online sales through jcp.com were 381 million dollars for the quarter, up 26.3 percent versus the same period last year, excluding the 53rd week.

Commenting

on the results, Myron E. (Mike) Ullman, III, Chief Executive Officer said, “JC Penney achieved what it set out to do on a number of important fronts in 2013. We stabilized our business, both financially and operationally, and restored our process disciplines, promotions, inventory levels and focus on the customer. As a result, we generated positive comparable store sales in the fourth quarter and ended the year with more than 2 billion dollars in total available liquidity. These important accomplishments reflect the progress we have made in our turnaround, which remains on course heading into 2014.”

Home, men's apparel, women's accessories and Sephora inside JC Penney were the company’s top performing merchandise divisions. For the quarter, gross margin was 28.4 percent of sales, compared to 23.8 percent in the same quarter last year, representing a 460 basis point improvement. For the fourth quarter, the company reported net income of 35 million dollars or 0.11 dollars per share. Adjusted net loss for the quarter was 206 million dollars or 0.68 dollars per share.

For the year, gross margin decreased 190 basis points to 29.4 percent when compared to the prior year’s 31.3 percent. The company reported an operating loss for the full year of 1.42 billion dollars, which includes 215 million dollars of restructuring and management transition charges.

During the year, Plano, the Texas headquartered company opened 60 new Sephora inside JC Penney locations, bringing the total to 446. For the fiscal first quarter of 2014, comparable store sales are expected to increase approximately 3 to 5 percent; gross margin is expected to improve versus last year's first quarter. For the full-year of 2014, comparable store sales are expected to increase mid-single digits; gross margin is expected to improve significantly versus 2013.