Sales at the retailer's stores in A and B-rated malls were about the "same" during the first quarter, J.C. Penney CFO Ed Record told analysts on a conference call Friday. The company's overall same-store sales declined 3.5 percent in the quarter. A bright spot, said Record, were sales at J.C. Penney's off-mall locations where they were a "couple hundred basis points" better than locations at malls.
There is no dancing around the fact J.C. Penney, much like its rivals in the mall, struggled in the first-quarter amid more people shopping online instead of visiting a store. Retailers, especially those tied to middle income consumers such as J.C. Penney, also battled cautious spending due to delayed tax refunds.
Before Friday's market open, J.C. Penney reported a first-quarter net loss of 38 cents a share, compared to the loss of 21 cents a share analysts anticipated. The retailer posted revenue of $2.7 billion, generally in line with Wall Street's estimates for $2.78 billion.
J.C. Penney affirmed its outlook for 2017, expecting earnings of 40 cents to 65 cents a share and comparable store sales to either fall or gain 1 percent.
On the earnings call, J.C. Penney CEO Marvin Ellison said despite seeing "a challenging apparel business," growth was driven in categories including activewear, touting "one of the hottest brands" Adidas (ADDYY) , and appliances.
"Admittedly we have a lot of work to do," Ellison said.
Shares of J.C. Penney crashed as much as 10.9 percent to $4.70 in afternoon trading.
Said Piper Jaffray analyst Erinn Murphy, "While we wholeheartedly agree with the strategic actions underway, we remain worried that structural factors have more influence at the end of the day."
The news comes after on Thursday, both Macy's (M - Get Report) and Kohl's (KSS - Get Report) reported weak quarterly reports, only adding to concerns that the outlook for retailers is grim. Nordstrom (JWN - Get Report) had a slightly better first quarter but its same-store sales still slipped 0.8 percent.
J.C. Penney, Macy's and the dying Sears Holdings Corp. (SHLD) are part of a growing list of 20 battered retailers, by TheStreet's count, being forced to shutter massive amounts of stores due to declining mall traffic, the rising cost of rent and wages and heightened pressure from e-commerce giants like Amazon (AMZN - Get Report) .
J.C. Penney alone plans to close 138 stores stores by the end of the summer, representing 13 percent to 14 percent of the retailer's current store base. On the call, Record said J.C. Penney is also in the process of closing a distribution center. The process begins May 22.
More retail news on TheStreet:
- Retail Wreck: More Stores Could Report Sluggish Sales Today
- Cramer: Nordstrom Illustrates How Amazon Is Killing Even the Best of the Best
- Adidas Slides After CEO Rejects Calls to Offload Reebok
- The Secret Is Out: You Spend More on Mom Than Dad
- Office Depot's Former CEO Says Retailers Are Stuck in the 1950s, and They Must Do This to Survive
Editors' pick: Originally published May 12.