Joining the ranks of the recently embattled department store, J.C. Penney gave up some of its recent gains as share slid 12 percent with reports that sales during the first quarter of the year had fallen by .4 percent, instead of growing by 3.2 percent as expected.
All in, JCP is reporting losses of 32 cents per share on $2.81 billion in revenue.
The news came with the somewhat softening affirmation that the chain expects to see growth of 3 percent to 4 percent over the next year, but it also margined its gross margin guidance to a 10 to 30 basis points increase owing to the cost of its appliances play and growth in online sales.
“We know we must continue to pivot our merchandise assortment to less weather-sensitive categories,” CEO Marvin Ellison said Friday on a conference call with analysts, as reported by CNBC.
Those expansions include growing the Sephora concession to 60 additional stores nationwide and re-upping on its long defunct appliance business. Despite the sales slip, the firm remains confident that its turnaround vision remains substantially on track.
"While our first quarter sales were below our expectations, we are maintaining our annual comp guidance of 3% to 4% as a result of the positive nature of our recent sales trends, the strength of our Sephora business and our decision to accelerate our appliance rollout," Ellison said in a statement. "Having said that, we remain confident that our turnaround remains on track, and we are excited about our 2016 sales drivers including new Sephora locations, center core enhancements and our nationwide rollout of major appliances announced earlier this week. Accordingly, we are reaffirming our $1 billion in EBITDA for 2016."