JCP beats the street despite profit decline
Furniture Today Staff -- Furniture Today, August 15, 2008
Plano, Texas – It’s not often that a nearly 36% drop in profits is greeted by Wall Street as a good thing, but JCPenney’s share price shot up 6% in morning trading to $39.22 after the company announced its second-quarter results.
Net income was $117 million, or 52 cents per share. Sales slipped 2.5% to $4.3 billion and comps fell 4.3%.
As is the case across retailing, home lagged both in-store and online, said Ken Hicks, president and chief merchandising officer, during this morning’s conference call.
However, the July debut of the Dorm Life back-to-school collection and the Linden Street lifestyle program for young families are showing some bright spots, he said.
Early winners within Dorm Life include bedding, window and accessories. In Linden Street the lead items so far have been the slipcover, chenille bedding and bath accessories, according to Hicks.
JCP is “pleased” with the performance of American Living, which runs across multiple hard and soft line categories in the store, but home has been impacted there as well. Hicks noted that the inaugural buy for the spring 2008 launch of the program took place before the economy hit a wall and said the company has made changes in product and pricing to address the current economic environment for the spring 2009 flow.
“Both team [JCP and Polo Ralph Lauren’s product development group] believe in the concept,” said Hicks, adding American Living is still projected to become a $1 billion program over a period of a few years.
Furniture Today's Ray Allegrezza Speaks with Stephen Bogart about Fine Furniture's New Bogart Line