Retail Roundup: Lego earnings are awesome, J.C. Penney sees profit

Retail Roundup: Lego earnings are awesome, J.C. Penney sees profit
Characters from "The Lego Movie." Lego, the Danish toy company, reported strong earnings for 2013. (Imeh Akpanudosen / Getty Images)

Lego: Everything is awesome for toy brick company Lego, which said Thursday that its global sales rose 10% last year even as the global toy market suffered a slight revenue slide.

The Danish company, whose star turn in "The Lego Movie" has led the U.S. box office since debuting in theaters Feb. 7, said revenue jumped to $4.5 billion from nearly $4 billion in 2012.


Rival Mattel Inc., the El Segundo toymaker behind the Barbie brand, said last month that its full-year revenue rose 1% to $6.5 billion.

Lego Chief Executive Jorgen Vig Knudstorp said in a statement that the business has more than quadrupled revenue in less than a decade. Lego enjoyed "healthy" single-digit sales growth in the U.S. last year, the company said.

Lego profit swung up 9% to $1.1 billion from $969 million. The company said it boosted its head count 13% to 11,755 full-time employees.

Also last year, the toymaker invested more than $489 million in production capabilities, expanding factories in Mexico and the Czech Republic and making headway on new facilities in Hungary and China.

Best Buy: Consumer electronics chain Best Buy Co. revealed better-than-expected profit for the holiday season, temporarily boosting its stock price.

During the fourth quarter, which ended Feb. 1, the Minneapolis company said it earned $310 million, or 88 cents, from continuing operations. During the same period a year earlier, the business suffered a net loss of $461 million, or $1.36 a share.

Stripping out the effect of special items, earnings per share settled at $1.24, beating Wall Street projections for $1.01 a share.

Best Buy, however, missed estimates for $14.7 billion in revenue and instead turned in a $14.5-billion performance, sliding 3% year over year.

Same store sales, a gauge that removes volatility by considering only stores open more than a year, slid 1.2% in the U.S. but soared 25.8% online.

Investors initially awarded Best Buy by boosting the stock, but by the afternoon in New York, the price was down slightly to $25.81 a share.

The holiday season presented the chain with "unusual circumstances," including "declining retail traffic, intense promotion, fewer holiday shopping days and severe weather," said Chief Executive Hubert Joly in a statement.

Best Buy is "still in the early stages" of a turnaround effort. More than 1,400 locations now feature a ship-from-store option that aims to compete with the sprawling delivery infrastructure on e-commerce rivals such as

Best Buy initially said in November 2012 that it would attempt to cut $725 million in costs from its North American operations.

On Thursday, the retailer boosted that target to $1 billion, saying it had already slashed $765 million in costs. A spokesman declined to comment on a recent report from the New York Post indicating that the retailer is planning to lay off 2,000 managers.


Sears: Sears Holdings Corp. emerged from what Chairman and Chief Executive Edward S. Lampert called a "tough-to-terrible" holiday season with gloomy earnings.

For the fourth quarter, which ended Feb. 1, Sears reported a $358 million net loss, narrowing the $489-million plunge from the same period a year earlier. For the full fiscal year, the Hoffman Estates, Ill., company lost $1.4 billion, the retailer said Thursday.

Still, investors pushed Sears stock up 6.7%, or $2.69, to $43.09 a share in afternoon trading in New York.

Together, Sears and Kmart same-store sales slipped 6.4%. But the company said that the gauge was positive in February.

The period "brought into stark relief just how irrevocably retail has changed" and emphasizes the need to transition Sears and sister brand Kmart "from traditional brick-and-mortar stores that simply sell products into an integrated platform" that spreads over the Internet and mobile devices, Lampert wrote in a note to investors and employees.

J.C. Penney: The end of the J.C. Penney Co.'s makeover may be in sight, Chief Executive Myron E. Ullman said after revealing promising earnings Wednesday.

The optimism sent the Plano, Texas, company's stock up 24.5%, or $1.46, to $7.42 in afternoon trading in New York on Thursday.

The retailer said it earned its first profit in more than two years, bringing in $35 million, or 11 cents a share, during the fourth quarter ended Jan. 31. During the same period a year earlier, the business lost $552 million, or $2.51 a share.

Revenue slipped 2.6% to $3.78 billion. But J.C. Penney said same-store sales rose 2%, making their first gain in nearly three years. And holiday sales during November and December jumped 3.1% year over year.

The company said it anticipates that same store sales will make a mid-single-digit increase in 2014 and that gross margin is "expected to improve significantly."

"We stabilized our business, both financially and operationally, and restored our process disciplines, promotions, inventory levels and focus on the customer," Ullman said in a statement.