J.C. Penney’s Myron Ullman: The Worst Is Behind Us
J.C. Penney (NYSE:JCP) finally had some good news to share on Wednesday. The struggling retailer released its earnings for the quarter ended February 1, and for the first time in more than two years posted a gain in profit along with a gain in same-store sales. J.C. Penney’s same-store sales rose 2 percent, the first gain since the quarter ending April 30, 2011, while its net income was $35 million, compared with a loss of $552 million in the year-ago quarter. The company’s last quarterly profit was in the quarter that ended July 2011. Revenue fell 2.6 percent to $3.78 billion.
J.C. Penney’s gains may seem paltry, but many analysts, along with CEO Myron Ullman, recognize that they that indicate J.C. Penney is finally moving in the right direction. The chief executive has said time and time again that the company is slowly orchestrating a full-out comeback, but it wasn’t until Wednesday that any advancements could be seen. According to Ad Age, Ullman now believes that the worst is behind J.C. Penney.
He told analysts during an earnings call this week, “The most challenging parts of the turnaround are behind us.” He also noted that J.C. Penney is preparing for the final phase of its turnaround and said that while the first two phases of its restructuring were important, as they involved stabilizing the brand and rebuilding, the third phase is also just as critical because it requires refining merchandising and marketing strategies in order to improve gross margins and sales.
J.C. Penney has committed to a series of strategies within the past few months in order to boost sales, especially during the lucrative holiday season, and the ones that seem to have benefitted it the most include its return to traditional discounting and the resurrection of popular private-label brands.