Marvin Ellison, the CEO and Chairman of J C Penney Company Inc (NYSE:JCP), said that the second quarter witnessed a significant growth in top line performance. Comp sales accelerated 2.2% sequentially in 2Q. This sales growth over the first quarter was seen online and in-store with both channels posting positive comps for the reported quarter.
The highlights
J C Penny reported that overall performance on a 2-year stack sales comp surged 6.3%. They saw growth in all of their merchandising segments compared to the first quarter. There was positive customer traffic in the July month. The top-performing merchandising segments were Sephora, hand bags, home and foot wear.
Across all the categories, the company recorded sequential improvement, including marked growth in jewellery business and women’s apparel following a tough first quarter. The QoQ growth shows that Maribeth Wes [ph] and her team performed an impressive job of minding 1Q2016 customer trends. The merchant team recorded smart adjustments to company’s merchandise assortment while the operations team succeeded to bring it in the stores.
The performance
While J C Penny recorded a positive 2.2% comp, it was able to improve gross margin, minimize SG&A by $48 million and efficiently manage inventory. These factors and the improved utilization of data demonstrate that they have improved their retail strategy. In fact, it boosts confidence in company’s ability to improve topline and grow EBITDA for 2H2016. The CEO acknowledged the contribution of company’s associates for their dedication to support great service while achieving fiscal discipline.
J C Penny continues to post strong performance in its existing and new Sephora across its shops. It opened 27 new locations in 2Q2016 brining 2016 count to 56. The total count of Sephora locations stood at 574. Now the company intends to commence four more locations after this fall. The performance in existing as well as new locations continues to be impressive.
