The Canadian Press - ONLINE EDITION

JC Penney ekes out small profit in 4th quarter but posts revenue shortfall

  • Print

NEW YORK, N.Y. - J.C. Penney's turnaround seems to be getting some legs.

The department store retailer swung to a small profit in the fourth quarter from a massive loss a year ago, and reported its first quarterly gain in a key revenue figure in more than two years.

The company also had positive news going forward: Penney said it expects that revenue at stores open at least a year, the key revenue measurement, will increase 3 to 5 per cent in the current quarter.

Investors were encouraged by the results, pushing shares up nearly 5 per cent, or 29 cents, to $6.25 per share in aftermarket trading when the results were announced. Shares had risen close to 6 per cent to $5.96 during regular trading, but they're down 35 per cent so far this year.

The results, which cover the crucial holiday shopping season, offer hopeful signs that Penney is making strides in recovering from a botched transformation plan by its former CEO, Ron Johnson that resulted in massive losses and plunging sales. Johnson, the mastermind behind Apple's retail concept, was ousted last April after 17 months on the job, and the board rehired Mike Ullman who had previously been at the helm for seven years.

Ullman is trying to win back shoppers by restoring the sales events and basic merchandise that the company ditched under Johnson in a bid to attract younger, wealthier consumers. That meant doing things like discontinuing brands like William Rast and Joe by Joseph Abboud that were brought in by Johnson and increasing markdowns to get rid of the excess inventory.

The company also has been taking some cost-cutting measures. Earlier last month, Penney announced it would cut 2,000 jobs and shutter 33 stores as it attempts to get back on the path of profitability.

"The most challenging and expensive parts of the turnaround are behind us, and the work we did in 2013 has laid the foundation of continued progress in 2014," Ullman told investors during a call on Wednesday.

But he acknowledged there's more work to do, such as increasing sales and profit margins, while continuing to manage expenses.

Penney said Wednesday that it earned $35 million, or 11 cents per share, in the three-month period ended Feb. 1. That compares with a massive loss of $552 million, or $2.51 per share, in the year-ago period.

Revenue slipped 2.6 per cent to $3.78 billion.

Excluding a tax benefit and other items, Penney had a loss of $206 million, or 68 cents per share, in the quarter. Analysts had expected a loss of 81 cents on revenue of $3.84 billion.

The company said revenue at stores opened at least a year was up 2 per cent in the fourth quarter. That's compared with a 31.7 per cent plunge for that measure for the holiday quarter a year ago.

In the latest year, Penney recorded a loss of $1.39 billion or $5.57 per share, while revenue dropped 8.7 per cent to $11.86 billion as Johnson's legacy continues to cast a shadow on its results.

Penney recorded a nearly $1 billion loss as revenue dropped 25 per cent to $12.9 billion for the year that ended Feb. 2, 2013, the company's first year of Johnson's failed transformation plan.

It reiterated that it ended the latest fiscal year with more than $2 billion in total available liquidity.

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes


  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.


Make text: Larger | Smaller


Kenney commends McDonald's on taking action on foreign worker controversy

View more like this

Photo Store Gallery

  • RUTH BONNEVILLE / WINNIPEG FREE PRESS June 23, 2011 Local - A Monarch butterfly is perched on a flower  in the newly opened Butterfly Garden in Assiniboine Park Thursday morning.
  • Goslings enjoy Fridays warm weather to soak up some sun and gobble some grass on Heckla Ave in Winnipeg Friday afternoon- See Bryksa’s 30 DAY goose challenge - May 18, 2012   (JOE BRYKSA / WINNIPEG FREE PRESS)

View More Gallery Photos


Do you support a proposed ban on tanning beds for youth under 18?

View Results

View Related Story

Ads by Google