JC Penney Spikes 12% Following Q4 Beat, Same-Store Sales Growth

Shares of J C Penney Company Inc JCP spiked higher by more than 12 percent after the company reported its fourth quarter results.

J C Penney said that it earned $0.39 per share in the fourth quarter on revenue of $3.996 billion. Wall Street analysts were expecting the company to earn $0.23 per share on revenue of $3.99 billion.

Comparable store sales rose 4.1 percent in the quarter, which helped boost adjusted EBITDA to $381 million - a 40 percent improvement from the same quarter a year ago. The company cited strong performance in Home, Sephora, Footwear, and Handbags while all regions delivered comp sales growth.

Revenue rose 3 percent for the full year fiscal 2015 to $12.6 billion while comparable sales rose 4.5 percent. Adjusted net loss for the full year improved by $463 million to a loss of $315 million while free cash flow was positive $131 million, an increase of over $74 million from 2014.

Looking forward to fiscal 2016, J C Penney is expecting comparable store sales growth of 3 to 4 percent, EBITDA of $1 billion and free cash flow to improve from 2015's level.

Marvin R. Ellison, chief executive officer, said, "We are very pleased with our performance for the fourth quarter and full year. Our focus on private brands, omnichannel and revenue per customer is clearly resonating as we continue to win market share in a competitive environment. We are also pleased that we delivered strong fourth quarter results while effectively managing our inventory, which finished the year up 2.6 %."

Mr. Ellison continued, "While significant work remains to regain our status as a world-class retailer, the Company's financial performance this year indicates we are on the right path to achieving our long-term financial objectives. Building on the momentum of 2015, and the positive trends of the mid-tier US customer, we now expect positive adjusted earnings in 2016, and EBITDA of $1 billion."