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Penney pleased with turnaround, sees sales rising


September 26. 2013 10:41AM
Associated Press

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(AP) J.C. Penney Co., whose shares have been tumbling toward 13-year lows on worries about its business, said Thursday that it is pleased with its turnaround efforts so far.


The department store operator also is seeing strength online and still anticipates a key revenue metric rising in the fourth quarter.


The announcement didn't appear to reassure investors. Its shares lost more ground in morning trading, falling more than 3 percent in early trading.


Penney has faced criticism over its available cash and turnaround efforts. The chain is trying to recover from a botched transformation plan spearheaded by former CEO Ron Johnson that led to disastrous financial results. The board ousted Johnson in April after only 17 months on the job and rehired Mike Ullman, who had been CEO of the retailer from 2004 to late 2011.


Penney said Thursday that online sales are up double-digits from a year ago. Online sales have been a bright spot for many retailers, as consumers increasingly shift to making many of their purchases on mobile devices, tablets and computers.


The Plano, Texas, company said that it is seeing increased buying online and in its stores mostly because it has key items back in stock and sizes that shoppers are looking for. Penney has 1,100 stores.


It still expects revenue at stores open at least a year to be up as it exits the third quarter and that the metric should be up in the fourth quarter. This figure is a key indicator of a retailer's health because it excludes results from stores recently opened or closed.


Penney's stock lost 34 cents, or 3.5 percent, to $9.78 in early trading Thursday after sinking as low as $9.64, its lowest level since November 2000.


Associated Press


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