J. C. Penney Q2 Loss Widens, Cuts FY18 Outlook; Stock Plunges

(RTTNews) - J. C. Penney Company, Inc. (JCP) reported that its second quarter net loss widened to $101 million or $0.32 per share, from $48 million, or $0.15 per share in the same period last year. But, comparable sales increased 0.3 % for the second quarter.

The company said it will continue to take actions to right-size its inventory, better curate its assortment and most importantly, provide a solid foundation that it can continue to build upon as it moves forward. Consequently, it reduced its guidance for fiscal 2018.

In Thursday pre-market trade, JCP is trading at $1.79, down $0.62 or 25.73 percent.

"I want to take this opportunity to update our stakeholders on the progress of the CEO search. The process is going well and the Board has met with highly qualified candidates who have expressed a strong desire to become the next leader of JCPenney. The hiring of a new CEO is the top priority of the Board of Directors and we will continue to expedite the process in order to bring this search to a successful conclusion," said Ronald W. Tysoe, JCPenney board chairman.

For fiscal year 2018,the company now expects adjusted loss per share to be in the range of $0.80 - $1.00, and Comparable store sales to be approximately flat. Analysts expect annual earnings of $0.04 per share. Previously, the company expected adjusted per share results to be between a loss of $0.07 and profit of $0.13, and comparable store sales change to be between flat and an increase of 2.0%.

Adjusted net loss was $120 million, or $0.38 per share, for the second quarter compared to an adjusted net loss of $23 million, or $0.07 per share, for the second quarter last year. Analysts polled by Thomson Reuters expected the company to report a loss of $0.06 per share for the second-quarter. Analysts' estimates typically exclude special items.

Adjusted net loss for the second quarter of 2018 and 2017 included gains on the sale of operating assets, which totaled $40 million, or $0.13 per share, and $1 million, or $0.00 per share, respectively; and $52 million, or approximately ($0.16) per share, resulting from an impairment charge in the second quarter this year related to the expected sale of the Company's three corporate-owned aircraft.

Quarterly total net sales decreased 7.5 % to $2.76 billion from $2.99 billion last year. The decline in total net sales was primarily the result of the 141 stores that closed in fiscal 2017. Wall Street analysts had a consensus revenue estimate of $2.86 billion for the quarter. Total revenues were $2.83 billion down from $3.07 billion in the prior year.

Comparable sales increased 0.3 % for the second quarter. Credit income, which was previously reflected as a reduction to SG&A, was $67 million for the second quarter this year compared to $83 million in the second quarter last year.