J. C. Penney Company Inc. (NYSE:JCP)’s Same Store Sales Rise 0.9% In October’13
J. C. Penney Company, Inc. (NYSE:JCP) has reported some good news for investors and shareholders. The struggling department store chain has shown some positive signs in its October sales. J C Penney announced that its same store sales increased 0.9 % in the month of October, marking a 490 basis point growth over September. This marginal growth, however, marks an end of a string of fall in sales at the retailer.
The company said its internet sales increased by 37.6% year over year, an acceleration of the positive trend in J. C. Penney Company’s online business.
Compared to last year, conversion continues to improve in October, showcasing favourable buyer response to promotional events and “improved” inventory levels, the company stated.
J. C. Penney Company, Inc. (NYSE:JCP) said it also continues to make a progress in the re-merchandising and re-configuration of its Home department in both offline and online. The transformation is getting recognized making Home department to witness the largest percentage sales increase in October, among the other divisions of JC Penney.
The company said it is happy with the performance jump in its online business in October. Home merchandise online sales increased by more than 50% as compared with last year’s sales. Infact, Home sales contributed to almost half of the total online sales during the month.
“J.C.Penney has made significant progress in addressing the challenges it faces, and we believe the Company is on the right track to return to long-term profitable growth,” said Myron E. (Mike) Ullman, III, and Chief Executive Officer of J.C.Penney. “We are proud of our October sales improvement, which we achieved despite the federal government shutdown and a challenging consumer environment. Not only did we deliver positive same store sales for the first time since December of 2011, we also saw significantly improved sales trends in Home and Men’s apparel, as well as Women’s accessories.”
Opening 30 new Sephora inside J.C.Penney locations in October, the company brought the total locations to 446.
In addition, lower clearance margins negatively affected the company’s third quarter gross margin due to the excessive inventory from the first two quarters of 2013. But, the good news has it that JC Penney’s gross margin showed sequential improvement within the quarter, with October representing the highest margin levels of the quarter.
Keeping the “progressing” turnaround in mind, Ullman said the company will now focus on restoring a “compelling” mix of brand merchandise that suits our customer taste.
At the same time, JC Penney’s arch rival The Bon-Ton Stores, Inc. (NASDAQ:BONT) is also gearing up to increase its sales and it all set to open its stores with blockbuster Black Friday deals to woo customers. It will be interesting to watch what JC Penney has in store this holiday season.