JC Penney (JCP) To Close 33 Stores, Cut 2,000 Jobs In Turnaround Effort

 @MeaganKaym.clark@ibtimes.com
on January 16 2014 8:04 AM
JC Penney
A man with a Macy's bag walks past the J.C. Penney's store in New York, April 11, 2013. Reuters

J.C. Penney Company, Inc. (NYSE: JCP) will close 33 U.S. stores and slash about 2,000 jobs to cut costs and return to profit.

CEO Myron Ullman in a statement Wednesday called the move an important step that “addresses a strategic priority to improve the profitability of our stores and position J. C. Penney for future success.”

The big Texas-based department store chain that operates about 1,100 mid-market U.S. stores suffered a 25 percent drop in sales in fiscal 2012 after trying to go upmarket. The store has since returned to its hallmark discounts and welcomed back popular in-house brands.

After nearly two years of decline, sales began picking up this fall. But the company’s scant three-sentence comment on holiday sales, released last week, raised doubts about the store’s performance.

Analysts expect J. C. Penney to report a 70 cent-per-share loss for the holiday quarter, according to Reuters.

The store closings are expected to save the company about $65 million, beginning this year. Locations to close include five in Wisconsin (home turf of competitor Kohl's), three in Pennsylvania and two in Florida. No stores in Penney’s home state of Texas are scheduled to close.

J.C. Penney employed 116,000 people as of February last year, about 40,000 fewer than February 2012.

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