J.C. Penney beats same-store sales forecasts, shares surge 20 percent

[February 28, 2019]  (Reuters) - J.C. Penney's comparable-store sales fell at a lower pace than expected, as the department store chain sold more jewelry and apparel during the key holiday shopping season.

Shares in the company surged 21 percent to $1.50 in early trade on Thursday following the news.

The results suggested that the Plano, Texas-based retailer's strategy to better serve its loyal customer base of middle-aged women rather than chasing after millennials with fickle tastes, appears to be paying off.

The company, once a storied name in American retail and today worth less than a tenth of its value two years ago, has also shuttered hundreds of stores, exited unprofitable businesses and revamped its locations to boost sales and revive profits.

"In spite of our past financial performance, we have already taken meaningful steps to drive improvement in key businesses such as women's apparel, active apparel, special sized apparel and fine jewelry," Chief Executive Officer Jill Soltau said in a statement.

The company said it would continue to streamline its business, announcing plans to shut 18 full-line stores this year and nine ancillary home and furniture stores.

Adjusted sales at J.C. Penney outlets open for at least 12 months fell 4 percent in the three months ended Feb. 2, better than Wall Street analysts' average forecast of a 4.3 percent decline, according to IBES data from Refinitiv.

Excluding one-time items, the company earned 18 cents per share, 8 cents more than Wall Street expectations.

(Reporting by Nivedita Balu and Aishwarya Venugopal in Bengaluru; Editing by Sai Sachin Ravikumar)

[© 2019 Thomson Reuters. All rights reserved.]

Copyright 2019 Reuters. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.  Thompson Reuters is solely responsible for this content.