Department store operator JC Penney Company Inc yesterday (9 November) posted a 22.6% surge in third quarter profits, driven by improved sales across all merchandise divisions and the introduction of new brands.

The Plano, Texas based company said year-on-year net income increased to $287m in the 13 weeks ended 28 October.

Total net sales rose 6.7% to $4.78bn, with comparable department store sales rising 5.2%. The strongest results were in children's, men's and family shoes.

During the quarter, direct sales increased 5.3%, and online sales were up by 27%.

Penney said its gross margin improved by 80 basis points to 42.6% of sales, helped by its private brands and better management of inventories.

"Our private and exclusive brands are growing in importance, clearly differentiating JC Penney in the eyes of the consumer," said Myron E (Mike) Ullman, III, chairman and chief executive officer.

He added that during the quarter the company introduced Sephora in five JCPenney stores and announced a new lingerie brand Ambrielle as well as two new lines with Liz Claiborne. These new offerings will arrive in stores early next year.

For the fourth quarter, JC Penney expects earnings per share of around $1.94, while full year earnings are likely to be $4.82 per share.