J.C. Penney’s second-quarter loss narrowed and same-store sales increased 2.2%, continuing a steady improvement in its performance as its turnaround plan gains traction.
The retailer on Friday reported a loss of $56 million, or 18 cents per share, down from $117 million (41 cents a share) in the year-ago quarter. Excluding one-time items, it lost only 5 cents per share, well above expectations for a 15-cent loss.
Penney’s has now beaten earnings forecasts for sixth straight quarters and same-stores sales have been positive, or at least flat, for 10 of the past 11 quarters. In trading Friday, its shares rose 6.1% to $10.55.
“We are pleased with the sequential improvement we achieved throughout the second quarter, and our solid performance across all key metrics is encouraging,” CEO Marvin Ellison said in a news release, adding, “We are continuing to win market share and improve the bottom line of our business thanks to the commitment and hard work of our over 100,000 associates.”
For the quarter, Sephora, Home, and Footwear and Handbags were the company’s top performing divisions. The Sephora stores-within-stores have been a consistent source of success for Penney’s, along with appliance sales, store revamps, and expanded omnichannel initiatives.
As part of Ellison’s turnaround strategy, Penney’s returned to selling appliances in May after a more than 30-year absence and, in the second quarter, rolled out appliances to more than 120 locations.
“While it might seem counter-intuitive to become more like Sears at the same time that Sears isn’t doing well, it’s a smarter move than it appears at first: as Sears shrinks and tries to launch its second mini-chain of appliance stores, there’s room for some retailer to sneak in and sell major appliances,” Consumerist said.
Penney’s continues to forecast same-store sales growth of 3% to 4% for the year. Revenue for the second quarter rose 1.5% to $2.92 billion, just missing analysts’ estimates of $2.93 billion.
“We are excited about the initiatives we have in place to drive incremental growth in the back half of the year,” Ellison said.