JCPenney has hope following weak quarter

JCPenney (NYSE:JCP) reported weak quarterly sales, just like many other retailers, but the company sees promise in new initiatives. 

      Marvin Ellison

Store traffic declined, as did the average order. Sales declined 1.6 percent to $2.81 billion, down from $2.86 billion last year.

"The first quarter was clearly challenging from a sales perspective," said CEO Marvin Ellison in a statement. "Although our business was not immune to the issues facing other retailers, I am pleased that we were able to deliver our second consecutive quarter of positive operating profit."

Management is sticking with prior guidance and expects same store sales to increase 3 to 4 percent for the year based on several factors, including its Sephora partnership and accelerated rollout of Sephora stores within JCPenney.

Sephora, men's, footwear and handbags were the company's top performing categories in the first quarter. A new men's athleisure line from Michael Strahan will be in stores by Father's Day and Sephora will also be adding new brands, according to The Dallas Morning News.

The new appliance division also shows promise.

JCPenney began testing appliances in 22 locations and now plans to roll the department out to 500 stores.

Appliances are bringing in new shoppers for JCPenney; one-third of buyers during the pilot phase were new and the vast majority of customers used a JCPenney charge card. The average sale was $1,200.

For more:
- see this Dallas Morning News article
- see this JCPenney press release

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