PLANO, Texas (AP) — Losses at J.C Penney doubled in the first quarter and sales at established stores fell again, capping a terrible week for retailers.
Though the loss at first did not appear as bad as many industry analysts had expected, many soured on even that after a closer look.
"Don't be fooled by the bottom line beat; it was entirely due to a real estate gain that we had not included in our forecast, wrote Citi analyst Paul Lejuez.
The direction for sales at J.C. Penney was clear, however, particularly at stores open at least a year, which fell for the third consecutive quarter.
Shares of other retailers, which took a huge hit Thursday following dismal reports from Macy's and Nordstrom, fell again after stabilizing overnight.
J.C. Penney tumbled 7 percent at the opening bell to below $5 per share, hitting an all-time low.
Revenue declined from $2.81 billion, to $2.71 billion, which was worse than Wall Street had expected.
For the three months ended April 29, Penney lost $180 million, or 58 cents per share. A year ago the Plano, Texas, company lost $68 million, or 22 cents per share.
Stripping out certain items, earnings were 6 cents per share. Analysts polled by Zacks Investment Research expected a loss of 22 cents per share, though those estimates were revisited by analysts due to asset gains.
Sales at stores open at least a year dropped 3.5 percent. Industry analysts watch that figure closely as a signal of a retailer's health because it excludes the volatility of stores that were recently opened or closed.
This week, Macy's, Nordstrom and Kohl's posted fading same-store sales numbers as well.
There is good news and bad news for retailers like J.C. Penney, Macy's, Nordstrom and others. Americans are spending money. They're just not spending it at the department stores that have been the cornerstone of the shopping experience in the U.S. for decades.
Data released Friday by the U.S. Commerce Department shows that Americans stepped up spending in April, but that money went largely to auto dealers, online stores or places like hardware stores.
In the same period, sales at department stores fell 0.2 percent.
In a category that includes online retailers, sales grew of 1.4 percent, the strongest of any group.
The path through the new retail landscape was made even more difficult for J.C. Penney after its catastrophic transformation several years ago under a one-time Apple executive.
Marvin Ellison took over as CEO in 2015. He has brought major appliances like washing machines back to the stores and is quickly expanding the number of Sephora beauty shops in its stores.
J.C. Penney is also trying to modernize, equipping its workers with mobile devices to help online shoppers pick up orders in the store.
J.C. Penney's decision to postpone liquidation sales at 138 stores targeted to close may suggest that the company is trying eke out something from the stores after a weak spring, said Kimberly Greenberger, an equity analyst at Morgan Stanley.
Ellison said that trends over the past two months are positive.
"While February was a very challenging month for J.C. Penney and broader retail, we are pleased with our comp store sales for the combined March and April period, which improved significantly versus February," he said.
Executives said Friday that they still expect full-year adjusted earnings between 40 cents and 65 cents per share. Analysts polled by FactSet predict earnings of 48 cents per share.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on JCP at https://www.zacks.com/ap/JCP
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