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Gap beats Street, Penney shy
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February 25, 1999: 10:58 a.m. ET
4Q earnings soared at Gap while Penney's profit fell, excluding gain
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NEW YORK (CNNfn) - The Gap Inc. reported fiscal fourth-quarter profits Thursday that beat Wall Street forecasts while J.C. Penney Co., dogged by sluggish sales, said earnings fell excluding one-time items.
Penney, the nation's fourth-biggest retailer, missed analysts' estimates by 1 cent.
Profits at the Gap, the No. 12 specialty chain, jumped 45 percent to a record as sales rose 40 percent in the quarter. Sales at stores open at least a year -- a closely watched gauge of a retailer's performance -- jumped 17 percent from a year earlier.
But the picture was starkly different at Penney, based in Plano, Texas. Total sales fell 4 percent to $9.3 billion while comparable-store sales decreased 2.8 percent at Penney stores, more than offsetting a 10 percent same-store rise at Penney's Eckerd drugstore chain.
Penney has been struggling to upgrade its merchandise mix and rejuvenate sales.
Penney said net income for the quarter was $207 million, or 77 cents a diluted share, compared with $201 million, or 76 cents a share, a year earlier. But excluding a one-time restructuring gain and other items, earnings fell to 72 cents a share, missing the average forecast of 73 cents a share, according to First Call, which tracks analysts' estimates.
Net income for the full year at Penney rose 5 percent to $594 million, or $2.19 a diluted share, but profits fell 28 percent to $2.14 a share excluding one-time items. Sales were little changed at $30.68 billion.
San Francisco-based Gap said net income jumped to $314 million, or 53 cents a diluted share, in the quarter ended Jan. 30, from $216 million, or 36 cents a share, a year earlier. Forecasts were for 50 cents a share, according to First Call.
Sales jumped to $3.03 billion from $2.17 billion.
For the year, Gap's net income jumped 54 percent to $824.5 million, or $1.37 a diluted share, as sales grew 39 percent to $9.05 billion.
Penney's stock fell ¾ to 37-7/8 while Gap's rose ¾ to 63-1/2 after the reports. 
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J.C. Penney
The Gap
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