Analysts had estimated a net loss of $1.20 and revenues of $12.62 billion. The company offered sharp prices on its well-known private label products such as St. John’s Bay, and continued to see women flock to cosmetics shop Sephora. For 2016, Penney upped its adjusted earnings forecast to $1 billion vs. its prior forecast of $900 million. The company says the strong focus on low prices is meant to build excitement that every trip will be a treasure hunt.
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CEO and Chairman Marvin R. Ellison commended the company’s progress: “We are very pleased with our performance for the fourth quarter and full year”.
Penney outlined a three-year plan to profitability back in 2014 and will likely gain some credibility with Wall Street today with its latest results.
J.C. Penney’s results, which were released several hours before they were due on Friday morning, were a bright spot in a troubled retail industry. Revenue rose almost 3 percent to $3.99 billion, above the $3.97 billion consensus estimate.
Penney said that it expects revenue at stores opened at least a year to rise anywhere from 3 percent to 4 percent, and that adjusted profits should be positive. (NYSE:JCP) announced that it will release its fourth quarter and full year 2015 financial results on Friday, February 26, at 7:30 a.m. ET. The upcoming Penney days where items will be just a penny are in the future. Comparable-store sales (comps) increased 4. Including one-time items, J. C. Penney’s reported quarterly loss of 43 cents per share, compared with a loss of 11 cents in the year-ago quarter. Apparently, the #SoWorthIt hashtag should keep shoppers informed about the J.C. Penney campaign. Gross margins are expected to move up 40 to 60 basis points from fiscal year 2015. The company had revenue of $2897.00 million for the quarter, compared to analysts expectations of $2878.68 million.
The stock closed up about 8.6% on Thursday at $8.36. Adjusted net income came in at $121 million, reflective of an enormous 831% or $108 million from previous year when it posted net loss.
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I expect SG&A to continue to decline as a percentage of net sales in future years, although in absolute dollar terms the pace of SG&A reductions may flatten out if sales continue to increase.
