Hampered by weaker sales and lower gross margin rates, J.C. Penney Co. Inc. posted a 9.1 percent decline in third quarter earnings.
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For the quarter ended Nov. 3, the company, which serves the moderate segment of retail, said net income dropped to $261 million, or $1.17 a diluted share, from $287 million, or $1.26, in the prior year on sales that slipped 1.1 percent to $4.73 billion from $4.78 billion. Operating income fell 18.5 percent to $411 million.
“After the completion of a strong back-to-school season and a favorable response to our early fall merchandise, we were disappointed to see sales weaken dramatically in September and October,” said Myron E. “Mike” Ullman 3rd, chairman and chief executive officer, in a statement. “The combination of weak housing conditions, mortgage and credit market concerns, and rising fuel prices has clearly led to a challenging macroeconomic environment for consumers. Along with unseasonable weather, this has created difficult conditions for most retailers, and our third-quarter performance shows that J.C. Penney was not immune to those conditions.”
For more, see Friday’s issue of WWD.