JCPenney’s chief executive has blamed the gloomy mortgage market and credit crunch for disappointing sales in its third quarter ending November 3.

The US department store giant’s total sales fell by 1.1 per cent, and like-for-likes by 3.5 per cent.

Chief executive and chairman Mike Ullman said that, after a strong back-to-school season, sales “weakened dramatically” in September and October.

He said: “The combination of weak housing conditions, mortgage and credit-market concerns and rising fuel prices has clearly led to a challenging macroeconomic environment for consumers. Along with unseasonable weather, this has created difficult conditions for most retailers and our third-quarter performance shows that JCPenney was not immune to those conditions.”

JCPenney operates 1,067 department stores in the US and Puerto Rico.

The lower sales and gross margin rates dragged down the retailer’s operating income by 180 basis points to 8.7 per cent of sales. For the quarter, it registered net income and income from continuing operations of US$261 million (£127.7 million), compared with US$286 million (£140 million) for the same period last year.

Ullman said: “In light of the expected weak retail environment, we will be taking a cautious approach to planning our business

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