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RAPAPORT... J. C. Penney Company Inc.'s conversion improved in October compared with one year ago due in large part to the retailer's focus on restocking and the return of key promotional marketing events. JCPenney stated that the average unit of retail and overall traffic fell in October, while the average transaction value and units per transaction improved from 2012, though it did not provide hard totals. Ecommerce sales from the jcp.com channel jumped 37.6 percent year on year. The retailer added that month-to-month same-store sales increased 0.9 percent in October from September, signaling the first increase since December 2011, but it did not provide a year-on-year comparison. Myron E. Ullman, III, the CEO of JCPenney, explained that the retailer has made significant progress in addressing turnaround hurdles, especially given the challenging consumer environment. Sales trends were positive for home goods, men's apparel and women's accessories in October. Online sales were strong for home merchandise, accounting for almost half of the total, while women's, men's and children's apparel were also strong performers, according to the retailer. JCPenney is scheduled to provide its third-quarter results on November 20; however, the retailer warned investors today to expect lower gross margin due to the overhang of inventory from the first two quarters of the year, higher levels of clearance units sold and the transition back to a promotional pricing strategy. Ullman said, "As the turnaround is progressing, we are focused on restoring a compelling mix of private, exclusive and national brand merchandise that better resonates with our customer and results in fewer markdowns at the end of the selling season." He added that JCPenney was fully prepared to execute aggressive plans for the Christmas season and will open stores at 8 p.m. on Thanksgiving Day. ''We will soon be unveiling new marketing to better communicate the unique value and stylish merchandise assortment we offer. We expect the holiday season to be extremely competitive, and we are ready to win,'' Ullman said.
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