National Jeweler Network

Financial Reporting

JC Penney sees rise in same-store, online sales

November 08, 2013

Plano, Texas--J.C. Penney Co. Inc. said Thursday that its same-store sales increased 0.9 percent in the month of October, marking the first time the retailer has recorded positive same-store sales in almost two years.

Sales on JCP.com also were up, rising 38 percent as compared with last year. Home merchandise sales were especially strong online, increasing more than 50 percent from last year, the company said. The department made up almost half of the company’s total online sales in the month of October.

“J.C. Penney has made significant progress in addressing the challenges it faces, and we believe the company is on the right track to return to long-term profitable growth,” said CEO Myron E. Ullman III.

“We are proud of our October sales improvement, which we achieved despite the federal government shutdown and a challenging consumer environment. Not only did we deliver positive same-store sales for the first time since December of 2011, we also saw significantly improved sales trends in Home and Men’s apparel, as well as Women’s accessories.”

J.C. Penney attributes its improved sales trends to the  restoration of inventory levels for key private brands, including St. John’s Bay, Stafford and JCP Home, as well as sales increases in leading national brands like Levi’s, Nike, Carter’s, Dockers, Alfred Dunner, Vanity Fair, and Izod.

While sales rose, gross margin for the third quarter fell due to clearance sales for excess inventory from the first and second quarter and J.C. Penney’s transition back to a promotional pricing strategy.

The company notes, however, that gross margin was improving throughout the quarter, and that October represented the highest margin levels of the period.

“As the turnaround is progressing, we are focused on restoring a compelling mix of private, exclusive and national brand merchandise that better resonates with our customer and results in fewer markdowns at the end of the selling season,” Ullman noted.

Conversion improved as well in October from the year-earlier period, as J.C. Penney works to restock certain items for customers and bring back key promotional marketing events.

J.C. Penney will release its full third quarter 2013 financial results on Nov. 20.