Boston, MA 05/16/2014 (wallstreetpr) – A chain of retail store operator of apparel and home furnishing products, J.C. Penney Company, Inc. (NYSE:JCP) announced better than expected results for the first quarter driven by revenue growth as well as expansion of gross margin and control over costs. The company has also provided an outlook for the second quarter as well as the current year.
1Q Results
The company suffered a net loss of $352 million, wider than $348 million, while the loss per share narrowed to $1.15 from $1.58 due to higher share count. This is better than the Wall Street expectations of a loss of $1.25 a share for the quarter.
Total net sales advanced 6.3% to $2.8 billion from $2.635 billion in the previous year quarter. This is also much better than the Street predictions of $2.71 billion. Significantly, J.C. Penney Company indicated that it had registered sequential growth in same store sales in every month during the quarter. For the first quarter, same store sales grew 6.2%.
Despite unfavorable impact due to big clearance sales in February and March, the company’s gross margin improved to 33.1% from 30.8% in the year earlier quarter. Sequentially too, it could improve its gross margin.
J.C. Penney Company, Inc. (NYSE:JCP)’s selling, general and administration costs slipped 6.4% to about $1.01 billion from $1.08 billion, while as a percentage of sales, it has improved to 36.0% from 40.9%. The improvement in both gross margin and selling, general and administration costs resulted in a lower percentage of operating costs in comparison with the sales.
Outlook
Moving ahead, the company sees comparable store sales to grow in mid-single digits in the second quarter with gross margin predicted to witness uptick sequentially over the first quarter. Selling, general and administration costs are also expected to be modestly lower than the year-ago quarter’s level.
For the full year, J.C. Penney Company, Inc. (NYSE:JCP) expects comparable store sales to grow in mid-single digit and gross margin to improve significantly over 2013.
