J. C. Penney Company, Inc. announced that total department store sales increased 1.9%, while comparable store sales increased 1.4% for the five weeks ended October 1, 2005. Comparable store sales were in line with guidance of a low-single digit increase and come on top of a 1.8% increase in last year's September period. The best performing merchandise categories for the month were family shoes, home, and children's apparel. From a geographical perspective, sales continue to be strongest in the southeast and western regions of the country.

Direct (catalog/Internet) sales increased 0.4%, which was also in line with guidance, and compared to a 3.3% increase in last year's September period. Sales for jcpenney.com increased nearly 30% in the September period in both this year and last year.

October Sales Guidance

For the month of October, the company expects comparable department store sales to increase low-single digits compared to an increase of 1.8% in the same period last year. Direct (catalog/Internet) sales are expected to be about flat versus a 1.7% increase last October, with continued strength coming from jcpenney.com. On October 7, 2005 the company will open seven stores in existing markets, six of which are in the off-mall format. An additional four stores are expected to open in the fourth quarter. In total the company will open 19 stores in fiscal 2005, representing its largest number of store openings since 1997.


                      Preliminary Sales Summary
                           ($ in millions)
                                                  % Increase
                        Period ended      All Stores     Comp Stores
                      ----------------- --------------- --------------
                      Oct. 1,  Oct. 2,  Oct. 1, Oct. 2, Oct.1, Oct. 2,
                       2005     2004     2005    2004    2005   2004
                      -------- -------- ------- ------- ------ -------

5 Weeks
Department stores      $1,251   $1,228     1.9     1.8    1.4     1.8
Direct                    254      253     0.4     3.3
                      -------- --------
Total Company          $1,505   $1,481     1.6     2.0

9 Weeks
Department stores      $2,627   $2,554     2.9     3.0    2.2     3.0
Direct                    448      448     0.0     4.7
                      -------- --------
Total Company          $3,075   $3,002     2.4     3.3

35 Weeks
Department stores      $9,476   $9,127     3.8     6.4    3.0     6.6
Direct                  1,698    1,625     4.5     3.1
                      -------- --------
Total Company         $11,174  $10,752     3.9     5.9

Earnings Guidance

As a result of an acceleration of the company's share repurchase program due to recent market conditions, management is raising earnings per share guidance for the third and fourth quarters. Management now expects earnings from continuing operations to be approximately 84 cents per share and $1.56 per share for the third and fourth quarters, respectively. This earnings guidance assumes average diluted outstanding common shares of approximately 249 million and 235 million shares for the third and fourth quarters, respectively. The company had previously guided to earnings from continuing operations of 82 cents per share and $1.52 per share for the third and fourth quarters, respectively. Management continues to expect full year operating profit to be in the area of eight percent of sales, consistent with previous guidance.

Capital Structure Repositioning Update

The company repurchased 11.4 million shares of common stock during the five weeks ended October 1, 2005, bringing total fiscal 2005 repurchases to 35.1 million shares of common stock for approximately $1.8 billion. The company has now completed approximately $3.7 billion, or nearly 90%, of the aggregate $4.15 billion share repurchase programs authorized since 2004, and continues to expect to complete the existing programs by the end of fiscal 2005.