* Q4 EPS 94 cts vs Wall Street view of 92 cts
* Q4 sales down 10 pct to $5.76 bln
* Sees Q1 loss of 20-30 cts/shr; deeper than Street view
* Shares up 0.3 pct
(Recasts, adds byline, company comments, updates share price)
By Nicole Maestri
NEW YORK, Feb 20 Department store operator J.C.
Penney Co Inc (JCP.N) posted a 51 percent drop in fourth
quarter profit on Friday, and said its loss in the current
quarter would be deeper than Wall Street estimates as shoppers
hold off on spending.
The most recent quarter's results were better than analysts
expected, helped by efforts to cut inventory and expenses amid
the weakest holiday shopping season in nearly four decades.
Penney said it intends to gain market share despite the
bleak outlook for 2009 by touting unique brands and winning
over customers who used to shop at competitors that have since
gone bankrupt, like Mervyn's and Linens 'n Things.
"This is truly a time of the survival of the fittest in
retailing," said Chief Executive Officer Myron "Mike" Ullman,
on a call with analysts.
Net profit fell to $211 million, or 95 cents per share,
from $430 million, or $1.93 per share, a year ago.
Earnings were 94 cents per share from continuing
operations, topping analysts' average estimate of 92 cents per
share, according to Reuters Estimates.
The company forecast a loss of 20 cents to 30 cents per
share in the first quarter on sales expected to fall 10 percent
to 13 percent. Analysts were expecting a loss of 18 cents per
share on revenue of $3.76 billion in the first quarter.
Penney also canceled its annual analyst meeting in Plano,
Texas, in April, citing the recession's impact on many firms'
travel budgets. Members of senior management will meet with
analysts and investors in New York on April 22 instead.
SALES OFF AS CUSTOMERS PULL BACK
Department store operators, including Penney, Kohl's Corp
(KSS.N), Macy's Inc (M.N) and Saks Inc SKS.N, have been hit
hard by the recession as customers make fewer trips to the mall
and avoid splurging on clothes, jewelry and home decor.
"Mall traffic still continues to be down 6, 7, 8 percent a
week," Ullman said. "But also when you get in the store,
conversion is still under pressure. So the customer is very
tentative. They're buying what they need, and they're being
smart about how they spend their money."
Penney's net sales fell nearly 10 percent to $5.76 billion,
hurt by deep discounts and consumers shunning discretionary
purchases. Same-store sales fell 10.8 percent.
Ullman said sales were strong in shoes, women's clothing
and at its Sephora cosmetic centers, but weaker in its jewelry
and home businesses.
Penney has been stocking its stores with a wide array of
private or exclusive brands, like nicole by Nicole Miller and
Fabulosity by Kimora Lee Simmons. Ullman said he believes the
retailer is taking market share in women's clothing.
The company's shares were up 4 cents at $14.96 in late
morning trading on the New York Stock Exchange.
(Additional reporting by Martinne Geller, editing by Dave