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How JCPenney’s Sales Fared in Fiscal 4Q17

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Dec. 4 2020, Updated 10:52 a.m. ET

Sales growth in 4Q17

JCPenney’s (JCP) sales grew 1.8% to ~$4 billion in fiscal 4Q17, which ended on February 3, 2018. However, its sales missed analysts’ consensus estimate by 0.4%. Sales growth in fiscal 4Q17 was an improvement over a 1.8% decline in fiscal 3Q17 and a 0.9% fall in fiscal 4Q16.

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What drove 4Q17 sales?

JCPenney’s same-store sales grew 2.6% in fiscal 4Q17, driven by higher average unit retail sales, units per transaction, and consumer traffic. However, the company experienced a softness in January sales.

Overall, the company experienced continued strength in its beauty segment, which includes Sephora, fine jewelry, and the salon. The company’s home business also performed well. Footwear and handbags outperformed the company’s same-store sales average. However, the apparel business generated same-store sales that were lower than the company average. In Part 5 of this series, we’ll look at the initiatives the company is taking to drive higher sales across its merchandise categories.

In comparison, Macy’s (M) sales rose 1.8% on a year-over-year basis in fiscal 4Q17 to $8.7 billion, driven by a strong performance in the holiday quarter. Growth came after 11 quarters of persistent weakness in Macy’s top line.

For fiscal 2017, JCPenney’s net sales declined 0.3% to $12.5 billion, while same-store sales grew 0.1%. Its fiscal 2017 net sales were adversely impacted by store closures.

Expectations for fiscal 2018

JCPenney expects its same-store sales growth to be 0%–2% in fiscal 2018. Analysts currently expect its fiscal 2018 sales to decline 2.9% to $12.1 billion due to the impact of stores closed in fiscal 2017 and an unfavorable comparison due to an additional 53rd week in fiscal 2017.

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