JC Penney income slips 9.1% in Q3

US: JC Penney income slips 9.1% in Q3

Author: just-style.com | 16 November 2007

Department store operator JC Penney Company has issued caution for trading in the remainder of the year, as it reported a 9.1% fall in Q3 net income to $261m.

This year's third quarter included $32m of federal and state income tax credits, the company said. Sales during the quarter also fell, by 1.1% to $4.72bn, compared to the third quarter of last year, while same-store revenues fell 3.5%.

"After the completion of a strong Back-to-School season and a favourable response to our early fall merchandise, we were disappointed to see sales weaken dramatically in September and October," said Myron E Ullman, III, chairman and chief executive officer of JCPenney. "The combination of weak housing conditions, mortgage and credit market concerns, and rising fuel prices has clearly led to a challenging macroeconomic environment for consumers. Along with unseasonable weather, this has created difficult conditions for most retailers, and our third quarter performance shows that JCPenney was not immune to those conditions."

During the third quarter, the company opened 28 new and relocated stores, completing its plan to open 50 stores in 2007.

In its fourth quarter guidance, the company forecast flat department store sales and a low-single digit fall in same-store sales. Full-year guidance was cut to be in the range of $4.63 to $4.78 per share, compared to $5.50 per share previously.

Sectors: Apparel, Retail

Companies: JC Penney