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JCPENNEY REPORTS STRONG SECOND QUARTER AS CONSUMERS RESPOND TO VALUE

 JCPENNEY REPORTS STRONG SECOND QUARTER AS CONSUMERS RESPOND TO VALUE
 DALLAS, Aug. 11 /PRNewswire/ -- J. C. Penney Company, Inc. (NYSE: JCP) reported today second quarter net income amounted to $80 million, or 61 cents per share, compared with $31 million, or 19 cents per share, earned in the same 1991 period.
 Commenting on the second quarter, Chairman William R. Howell said, "Despite the difficult retailing environment, we have recorded consistent sales increases throughout the country by offering a well- balanced mix of both basic value items and affordably-priced fashion merchandise."
 For the six months ended July 25, 1992, net income of the department store and catalog retailer was $216 million, or $1.65 per share, compared with $111 million, or 80 cents per share, last year.
 In the second quarter, gross margin dollars improved 10.5 percent on a 9.6 percent increase in retail sales. As a percent of retail sales, gross margin was up slightly from the previous year.
 Selling, general, and administrative (SG&A) expenses increased 4.1 percent, or $48 million, from last year's second quarter. These expenses rose as a result of the national television advertising strategy and increased sales incentive compensation related to the Company's higher sales volume. As a percent to sales, SG&A expenses were reduced substantially from the level of last year.
 The Company's life and health insurance, banking, and real estate businesses recorded strong profit gains in the second quarter.
 Interest expense continued to decline in the period, decreasing 19.2 percent, or $15 million, due to the previously reported debt restructuring program.
 "Sales of Fall merchandise were particularly encouraging during the latter part of the second quarter. As we continue to communicate a clear value message to consumers, JCPenney expects to achieve favorable results during the second half of the year," Howell added.
 J. C. PENNEY COMPANY, INC. AND SUBSIDIARIES
 SUMMARY OF BUSINESS RESULTS
 (Amounts in millions except per share data)
 Periods ended 13 weeks 26 weeks
 Percent Percent
 7/25/92 7/27/91 Inc. 7/25/92 7/27/91 Inc.
 (Dec.) (Dec.)
 Retail sales $ 3,789 $ 3,456 9.6 $ 7,582 $ 6,889 10.1
 Margins and expenses
 FIFO gross
 margin 1,230 1,113 10.5 2,524 2,291 10.2
 LIFO credit
 (charge) 0 (9) 0 (15)
 LIFO gross
 margin 1,230 1,104 11.4 2,524 2,276 10.9
 Selling, general and
 administrative
 expenses (1,208) (1,160) 4.1 (2,403) (2,321) 3.5
 Finance charge
 revenue 140 160 (12.7) 297 337 (11.8)
 Interest expense,
 net (61) (76) (19.2) (130) (151) (13.6)
 Profits of other
 businesses 30 21 48.2 62 35 77.3
 Pretax income 131 49 350 176
 Income taxes (51) (18) (134) (65)
 Net income(A) 80 31 216 111
 Earnings per share(A)
 Primary $ .61 $ .19 $ 1.70 $ .80
 Fully diluted $ .61 $ .19 $ 1.65 $ .80
 (A) 1991 YTD earnings do not include a charge of $184 million or $1.58 per share fully diluted for the cumulative effect of an accounting change for postretirement health care benefits made last year.
 SUPPLEMENTAL DATA
 Average shares
 Primary 118.0 116.8 117.6 116.8
 Fully diluted 129.4 128.4 129.2 128.4
 FIFO gross margin
 percent retail
 sales 32.4 32.2 33.3 33.3
 SG&A percent
 retail sales 31.9 33.6 31.7 33.7
 Effective income
 tax rate 38.5 36.9 38.2 37.0
 Total receivables
 serviced -- -- $ 3,553 $ 3,974
 FIFO inventory -- -- $ 3,642 $ 3,196
 -0- 8/11/92
 /CONTACT: Duncan Muir of JCPenney, 214-591-1329/
 (JCP) CO: J. C. Penney Company, Inc. ST: Texas IN: REA SU: ERN


LR -- NY020 -- 8845 08/11/92 09:25 EDT
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Publication:PR Newswire
Date:Aug 11, 1992
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