J. C. Penney Quarterly Net Up a Strong 24.9%
J. C. Penney Co. on Tuesday said its fiscal first-quarter net income jumped 24.9% over a year ago on an 8.7% gain in sales.
The performance by the nation’s third-largest retailer is expected to be one of the best among the top 10 retailing companies. Other reports should come within the next few weeks.
The Limited Inc. and Nordstrom Inc., two much smaller retail chains, also had outstanding first quarters with net income rising 47% and 29.5%, respectively.
The February-April period has been a generally sluggish one for the country’s retailers.
New York-based Penney said its net income for the three months ended April 26 came to $63 million, compared to $50 million in the same period last year. Sales rose to $3.045 billion from $2.8 billion, the company said.
The company had a charge of $24 million from the retirement of some debt in the latest quarter. Without that charge, retail income rose 78.1% to $85 million, Penney said.
Chairman William Howell said the results of its stores and its catalogue were outstanding. Gross margins improved substantially because of the strong sales performance and lower markdowns, Howell said.
Walter Loeb, a retail analyst with Morgan Stanley, said: “The company, as you know, embarked on a more moderate price line, going after the middle-income customer by reducing their prices by about 20% to 30%.”
The Limited, with headquarters in Columbus, Ohio, said its net income for the three months ended May 3 totaled $31.4 million, compared to $21.3 million last year.
Sales were up 43% to $661.6 million from $461.1 million.
Limited Chairman Leslie Wexner said: “We think this good performance resulted from our focus on the customer, giving her fashion and value and our ability to execute the details with skill in all aspects of our business.”
The Limited Inc., through the Limited, Limited Express, Lane Bryant, Sizes Unlimited, Victoria’s Secret, Lerner and Henri Bendel, operates 2,388 women’s apparel specialty stores nationwide. It distributes apparel nationally through seven Brylane catalogues and one Victoria’s Secret catalogue.
Seattle-based Nordstrom reported net income of $9.44 million on revenue of $302.2 million for the three months ended April 30. A year earlier, the retailer had a profit of $2.29 million and sales of $226.5 million.
As of April 30, Nordstrom had 53 stores in operation. On April 4, the company opened a 130,000-square-foot store in Montclair, and it plans to open its new store at the South Coast Plaza shopping center in Costa Mesa on May 16, replacing the existing store that was opened in 1978.
