Boy, it just wasn’t J.C. Penney’s year.
The mid-priced department store chain on Wednesday reported another much larger-than-expected loss in the fiscal fourth quarter on a nearly 30 percent plunge in revenue in the latest sign that shoppers aren’t happy with the changes it’s made in the past year.
The results mark a full year of massive quarterly losses and revenue declines that miss Wall Street estimates since J.C. Penney Co. began a turnaround strategy that included ditching most of its coupons and sales events in favor of everyday low prices, bringing in hipper designer brands such as Betsy Johnson and remaking outdated stores.
The quarterly performance also puts additional pressure on CEO Ron Johnson, the former Apple Inc. executive who was brought in about a year ago to turn the stodgy retailer that was losing money into a hip and profitable company that can compete with the likes of Macy’s or H&M. In the past year since Johnson rolled out his plan, though, even once loyal customers have strayed away from the 1,100-store chain.
Teresa Cansell, for instance, used to make the 45-mile trek from her farm near Leon, Kan., to a Penney store in Wichita about once a month. But since Penney started making changes last year, she’s only been twice.
“I loved the old J.C. Penney. I liked the coupons,” Cansell, 53, said. “I used to go to Penney every time I got them in the mail. I would buy a ton of stuff.”
“It’s the worst performance I have ever seen by a company in one year,” said Walter Loeb, an independent retail consultant.
The worry on Wall Street is that Johnson won’t be able to turn around business fast enough to finance the transformation of its stores. But customers like Ricky Rodriguez, from Fort Worth, Texas, offer hope for Penney.
“I feel like the guy section is getting more hip,” said the 27-year-old who recently bought a dress shirt for $25 at Penney. “I’ve been going there every other week.”