J.C. Penney Profit Up

J.C. Penney Co. said Thursday that its second-quarter profit edged up nearly 2% beating Wall Street expectations, though it said customers are worried about high energy prices and the weak housing market.

Sales increased nearly 4% to $4.39 billion from $4.24 billion a year ago, but it fell short of analysts' forecast of $4.42 billion.

Company officials said the back-to-school season was off to a good start, and that sales were strong for women's apparel, including Penney's private-label lingerie brand Ambrielle and Liz & Co. and Concepts by Claiborne.

Chairman and chief executive Mike Ullman said customers were worried about high energy prices and the housing slowdown, and he expected the economy to remain unchanged in the second half of the year.

But Ullman said sales of most items other than home furnishings were solid. He said the chain could withstand economic slowdowns and continue to open 50 new stores a year.

"Our customers have jobs. Our customers have lots of things they want and need, and we're seeing a good response," Ullman said. He said the company saw no indications of delinquencies or bad debt on customers' store credit card accounts.

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