J C Penney Posts Narrower-Than-Expected Q1 Loss

J C Penney Company Inc JCP reported a narrower-than-expected loss for the first quarter on Wednesday and lifted its guidance for the year. The Plano, Texas-based company posted a quarterly loss of $167 million, or $0.55 per share, versus a year-ago loss of $352 million, or $1.15 per share. Excluding one-time items, the company's adjusted loss came in at $0.57 per share for the quarter. Its net sales rose to $2.86 billion, from $2.80 billion in the year-ago quarter. However, analysts were expecting a loss of $0.77 per share on revenue of $2.87 billion. The average estimate among 48 Estimize users was for a loss of $0.73 per share and revenue of $2.88 billion. Comparable sales climbed 3.4 percent in the quarter. Its gross margin widened 330 basis points to 36.4 percent of sales, versus 33.1 percent in the year-ago quarter. SG&A expenses declined $44 million from the year-ago quarter to $965 million. Operating income for the quarter rose 70 percent to a loss of $75 million, while EBITDA surged by $168 million to $79 million in the first quarter. Myron E. (Mike) Ullman, III, chief executive officer said, "We are pleased with the Company`s solid performance this quarter across all key metrics including sales, gross margin and EBITDA. This year we are switching gears, going on the offensive to gain back share and grow our business profitably while executing our vision to become the preferred shopping choice for Middle America. I would like to thank our team of 114,000 associates for their hard work and warrior spirit that helped us deliver these results. It is their passion to win and to serve the customer that sets JCPenney apart from the competition." J C Penney expects 2015 comparable sales growth of 4 percent to 5 percent, versus its earlier forecast of 3 percent to 5 percent growth. It also projects gross margin to rise 100 to 150 basis points, and EBITDA of around $600 million. J C Penney shares rose 1.03 percent to $8.80 in the after-hours trading session.