J. C. Penney Company, Inc. (JCP) swung to a net profit for the quarter ended Jan. 28, 2017. The company has made a net profit of $192 million, or $ 0.61 a share in the quarter, against a net loss of $131 million, or $0.43 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $202 million, or $0.64 a share compared with $121 million or $0.39 a share, a year ago. Revenue during the quarter went down marginally by 0.88 percent to $3,961 million from $3,996 million in the previous year period. Gross margin for the quarter contracted 99 basis points over the previous year period to 33.12 percent. Operating margin for the quarter period stood at positive 6.92 percent as compared to a negative 0.45 percent for the previous year period.
Operating income for the quarter was $274 million, compared with an operating loss of $18 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $449 million compared with $381 million in the prior year period. At the same time, adjusted EBITDA margin improved 180 basis points in the quarter to 11.34 percent from 9.53 percent in the last year period.
Marvin R. Ellison, chairman and chief executive officer, said, "We are pleased that in the face of a very challenging 2016 retail environment we delivered our first positive net income since 2010. As recent as 2013, JCPenney reported a net loss of nearly $1.3 billion, or ($5.13) per share, and negative EBITDA of $641 million. This year, we delivered positive net income and generated EBITDA of over $1 billion. This is a reflection that the growth initiatives we laid out at our analyst meeting are working. These initiatives drove significant category growth in the fourth quarter, and provide us a platform to build upon in the years to come. Although our quarter was negatively impacted by the first three weeks of November, we are pleased that we delivered positive sales comps in the combined December and January period. We also saw record online performance over the holiday season, and with our continued focus on improved site functionality, expanded and enhanced fulfillment and continued growth in our assortment, we know this will allow us to deliver significant growth in the digital business."
For financial year 2017, the company projects diluted earnings per share to be in the range of $0.40 to $0.65 on adjusted basis.
Operating cash flow declines
J. C. Penney Company, Inc. has generated cash of $334 million from operating activities during the year, down 24.09 percent or $106 million, when compared with the last year. The company has spent $316 million cash to meet investing activities during the year as against cash outgo of $296 million in the last year. It has incurred net capital expenditure of $331 million on net basis during the year, up 7.12 percent or $22 million from year ago.
The company has spent $31 million cash to carry out financing activities during the year as against cash outgo of $562 million in the last year period.
Cash and cash equivalents stood at $887 million as on Jan. 28, 2017, down 1.44 percent or $13 million from $900 million on Jan. 30, 2016.
Working capital increases marginally J. C. Penney Company, Inc. has recorded an increase in the working capital over the last year. It stood at $1,678 million as at Jan. 28, 2017, up 4.48 percent or $72 million from $1,606 million on Jan. 30, 2016. Current ratio was at 1.69 as on Jan. 28, 2017, up from 1.67 on Jan. 30, 2016.
Days inventory outstanding has increased to 49 days for the quarter compared with 47 days for the previous year period. At the same time, days payable outstanding was almost stable at 17 days for the quarter, when compared with the previous year period.
Debt remains almost stable
J. C. Penney Company, Inc. has witnessed an increase in total debt over the last one year. It stood at $4,836 million as on Jan. 28, 2017, up 0.65 percent or $31 million from $4,805 million on Jan. 30, 2016. Total debt was 51.92 percent of total assets as on Jan. 28, 2017, compared with 50.89 percent on Jan. 30, 2016. Debt to equity ratio was at 3.57 as on Jan. 28, 2017, down from 3.67 as on Jan. 30, 2016. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: [email protected]
