JCP lowers 1Q guidance, stock tumbles

-- Home Textiles Today, 3/28/2008 1:10:00 PM

Plano, Texas – Department store retailer JCPenney today lowered its first quarter sales and earnings guidance, projecting profit of about $0.50 per share – starkly below the previous projection of $0.75 to $0.80 EPS.

The 1,073-unit retailer also projected a high-single-digit decline in comp store sales, replacing the previous guidance of a low-single-digit decline.

“Consumer confidence is at a multi-year low,” said chairman and ceo Mike Ullman, as the $19.9 billion company reported “sales through the Easter holiday well below expectations.”

Of the widely reported economic downturn, Ullman noted, “We expect the continuation of a difficult environment over the course of 2008.”

“As a result, our management team is focused on enhancing the customer experience and finding additional opportunities in both our merchandising and expense management to best position the company to benefit when a recovery takes hold,” Ullman concluded.

In very heavy volume, shares of JCPenney traded down more than 10% at the opening bell, then settled near a 7% loss by midday, as stockholders reacted.