JCPenney shares dropped more than 13 percent on Friday following an earnings release that, while technically a beat on adjusted diluted EPS, posted a significant comp sales decline and a slight drop in revenue for the retailer.
For the first quarter of 2017, JCPenney reported diluted EPS of $0.06 on $2.7 billion in revenue, up from an EPS loss of $0.32 in the same period last year on $2.8 billion in revenue. Analysts had expected a net loss of $0.21 and $2.77 billion in revenue. On a GAAP basis, JCPenney lost $0.58 per share in Q1 2017.
“We continue to make encouraging progress in the Company’s competitive and financial position despite our top-line performance during the first quarter,” said CEO Marvin Ellison. “While February was a very challenging month for JCPenney and broader retail, we are pleased with our comp store sales for the combined March and April period, which improved significantly versus February.”
For the quarter, JCPenney reported that comp-store sales dropped 3.5 percent.
By division, JCPenney reported that Home, Sephora, Fine Jewelry and Salon comped positively in Q1 2017. By region, the retailer’s best performing markets were in the Southwest and Southeast U.S.
The company reaffirmed its full-year guidance, expecting comp-store sales in a range of a 1 percent loss to a 1 percent gain. For the year, the company is eyeing an adjusted EPS in a range of $0.40 to $0.65. Analysts, meanwhile, will look for EPS of $0.46 and sales of $12.33 billion across 2017.