J.C Penney decides to close 18 full-line stores in 2019
J. C. Penney Company, Inc. (JCP) one of largest apparel and home retailers in the US, has determined that it will close 18 full-line stores in 2019, including the three locations previously announced in January. In addition, the Company will also close 9 ancillary home and furniture stores, further aligning the Company’s brick-and-mortar presence with its omni channel network, and enabling capital resources to be reallocated to locations and initiatives that offer the greatest long-term value potential.
The stores identified for closure require significant capital, are minimally cash flow positive relative to the Company’s overall consolidated average or represent a real estate monetization opportunity. Comparable sales performance for the closing stores was significantly below the remaining store base and these stores operate at a much higher expense rate given the lack of productivity. Associates who will be impacted by the store closures will receive separation benefits, which includes assistance identifying other employment opportunities and outplacement services, such as resume writing and interview preparation.
During the first half of 2019, the Company expects to record an estimated pre-tax charge of approximately $15 million, primarily relating to non-cash asset impairments and transition costs, in connection with this action. Nearly all impacted stores are expected to close in the second quarter of 2019.
“For the past few months, I have met with and listened to JCPenney associates throughout the organization, as well as our valued suppliers, customers and other partners, to gain their candid perspectives on our Company, both positive and constructive. Based on everything I have seen and heard, I am even more convinced that JCPenney is a revered brand that has the capacity to deliver improved financial results this year. In spite of our past financial performance, we have already taken meaningful steps to drive improvement in key businesses such as women’s apparel, active apparel, special sized apparel and fine jewelry,” – Jill Soltau, chief executive officer of JCPenney.
JCP, combines an expansive footprint of over 860 stores across the United States and Puerto Rico with a powerful e-commerce site, jcp.com, to deliver style and value for all hard-working American families. At every touchpoint, customers will discover stylish merchandise at incredible value from an extensive portfolio of private, exclusive and national brands. Reinforcing this shopping experience is the customer service and warrior spirit of approximately 98,000 associates across the globe, all driving toward the Company’s mission to help customers find what they love for less time, money and effort.
Source: JCP Headquarters, Plano, Texas, United StatesNews Retail US