Penney posts profit, prepares to mail spin-off

Things are looking up for cataloger/retailer J.C. Penney (NYSE: JCP). Despite a 3% decline in annual sales, the general merchandiser ended fiscal 2001 in the black. For the year ended Jan. 26, Penney posted net income of $98 million on total sales of $18.16 billion. The previous year, Penney had lost $705 million on sales of $18.76 billion.

As for Penney’s catalog and department stores, operating profit more than doubled to $548 million, compared with $254 million for fiscal 2000. And while catalog sales declined, as Penney had projected, the Plano, TX-based company says an increased focus on inventory and expense management led to the gains in operating profit. In its Eckerd Drugstore business, Penney reported net income of $95 million, compared with a net loss of $705 million in 2000.

For the fourth quarter ended Jan. 26, total department store and catalog sales fell 3%, to $5.8 billion, compared with $6.1 billion in quarterly sales last year. Catalog sales decreased 25%, which the company says was in line with projections. Comparable store sales increased 4%. Net income increased to $95 million, from a net loss of $580 million last year.

In other company news, Penney will launch a women’s specialty apparel book in March. The catalog will sell apparel in regular, petitie, and plus sizes, says spokesperson Stephanie Brown.