J. C. Penney Company Inc. (JCP) reported Friday a wider year-over-year net loss for the second-quarter 2017. Total net sales for the quarter were up 1.5%, while comparable sales declined 1.3%. It reaffirmed its adjusted earnings per share guidance for fiscal year 2017.
Quarterly loss was wider than analysts’ expectations, but net sales beat their estimates.
In the pre-market trade, JCP is trading at $3.61, down $1.10 or 23.35 percent.
Marvin Ellison, chairman and chief executive officer said, “During the second quarter, we liquidated inventory in 127 of our closing stores which had a negative impact on gross margin and EPS. These events were isolated to the second quarter.”
Net loss for the second quarter widened to $62 million or $0.20 per share, from $56 million, or $0.18 per share in the same period last year.
Adjusted net loss was $28 million or $0.09 per share, for the second quarter compared to an adjusted net loss of $16 million or $0.05 per share, last year. Analysts polled by Thomson Reuters expected the company to report a loss of $0.05 per share for the quarter. Analysts’ estimates typically exclude special items.
Marvin Ellison, said,”we are reaffirming our EPS guidance for the year, and remain confident in our ability to further strengthen our balance sheet, while driving sustainable growth and long-term profitability for JCPenney. To that end, we are pleased that we are off to a strong start in August for the all-important back to school season. We are excited by this momentum and expect to deliver improved results in the back half of the year.”
Total net sales for the second-quarter increased 1.5% to $2.96 billion from $2.92 billion in the same period last year. Analysts expected revenue of $2.84 billion for the quarter. Comparable sales declined 1.3% for the second quarter, resulting in a positive two-year stack of 0.9%.
Inventory at the end of the second quarter 2017 was $2.8 billion, a decrease of 6.8% compared to the end of the second quarter last year. The reduction was driven by liquidation of inventory in closing stores, and a decrease of 3.7% in comparable store inventory. Free cash flow was a positive $303 million, an increase of $234 million versus last year.
Looking ahead to fiscal 2017, the company still expects adjusted earnings to be in a range of $0.40 to $0.65 per share; comparable store sales in a range of down 1 percent to up 1 percent. Analysts expect annual earnings of $0.49 per share.
by RTT Staff Writer
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