JC Penney shares crater on earnings miss, lowered forecast

FAN Editor

J.C. Penney on Thursday reported quarterly earnings and revenue that missed at analysts’ expectations.

Shares of the company were down nearly 25 percent.

Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Thomson Reuters:

  • Losses per share: 38 cents, adjusted, vs. 6 cents, expected
  • Revenue: $2.76 billion vs. $2.86 billion expected

J.C. Penney reported fiscal fourth-quarter net loss of $101 million, or 32 cents per share, more than double its loss of $48 million, or 15 cents cents per share a year earlier.

Excluding items, J.C. Penney lost 38 cents per share, worse than the loss of 6 cents per share expected by analysts surveyed by Thomson Reuters.

Net sales declined 7.5 percent percent to $2.76 billion, missing expectations of $2.86 billion.

The retailer also said it is reducing its outlook for fiscal 2018 as it continues to grapple with the overhang of unsold merchandise. It now expects same-store sales to be roughly flat and to post an adjusted loss per share $1 to 80 cents.

The earnings are the first since CEO Marvin R. Ellison announced his resignation this spring, to head to the same position at Lowe’s.

The departure came at an inopportune time for the company, which has struggled to compete within the quickly evolving retail landscape, as consumers shift their shopping online and away from the mall. Last year, it closed more than 100 stores.

Under Ellison, J.C. Penney had taken a number of efforts to help steward a turnaround, including a focus on beauty and appliances. In a bid to boost traffic, the retailer has focused on its salon business, hoping hair-dresser loyalty would turn into shopping frequency.

J.C Penney’s Chairman Ronald W. Tysoe said Thursday the CEO process “Is going well and the board has met with highly qualified candidates who have expressed a strong desire to become the next leader of JCPenney. The hiring of a new CEO is the top priority of the Board of Directors and we will continue to expedite the process in order to bring this search to a successful conclusion.”

In March, it eliminated 230 positions and announced the departure of executive vice president of Penney’s omnichannel business, Mike Amend.

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