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RAPAPORT... J. C. Penney Company Inc. disclosed that same-store sales in September were down 4 percent year on year, while revenue improved 580 basis points compared with August 2013, though the retailer did not provide hard totals for these measures. Fine jewelry, apparel and women's accessories were all performing stronger than the company average, according to the retailer. Gross margin, however, was negatively impacted by lower clearance margins due to the overhang of inventory from the first two quarters of the year.
One bright spot came from strong ecommerce sales at jcp.com, where revenue surged 25.3 percent year on year.
This past week, JCPenney closed a public offering of 84 million shares of common stock that generated approximately $785 million in net cash proceeds. Its year-end liquidity is now expected to be in excess of $2 billion.
Myron E. (Mike) Ullman, III, the CEO of JCPenney, said, "Reconnecting with our customers and getting them into our stores is a top priority. Our enhanced messaging is reminding shoppers that JCPenney's offering of trusted private brands, key national brands and unique attractions sets us apart from the competition. Over the last six months, we have made significant strides and are now seeing positive signs in many important areas of the business, in spite of what continues to be a difficult environment for consumers and retailers in general. While pleased with the improving trends and more predictable performance, we are still in the early stages of the turnaround and will maintain a relentless focus on achieving our long-term goals for the benefit of our customers, associates and shareholders."
During September, purchase conversion increased compared with one year ago, primarily due to improved inventory levels in key items and sizes that the customer expects to find. Ullman stated that reconnecting with shoppers required having the merchandise and an ''exceptional experience.''
Private brands and item basics have been restored to inventory levels that are sufficient to meet demand heading into the critical Christmas season, he said. "In addition to our private brands, our assortment of trusted national brands such as Levi's, Carters, Nike and others, has made JCPenney a leading destination for families. I am pleased that JCPenney's performance in many key national brands is significantly ahead of last year. JCPenney remains current in its payments to vendors and we are grateful for the strong support and confidence they have shown as we continue to make progress in our turnaround."
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