UPDATE | No Valley stores on JCP closure list


Wire and staff reports

J.C. Penney is closing more stores after a weak holiday sales season but no Valley stores are on the list, a spokesman told The Vindicator.

Locally, the company has stores in Austintown, in Boardman at the Southern Park Mall, in Niles at the Eastwood Mall and in Hermitage, Pa.

The company is closing a store at the Midway Mall in Elyria as well as the J.C. Penney Furniture store in North Olmstead.

"This decision is the result of an ongoing review of our store portfolio, which includes assessing locations that may not meet our required financial targets or represent an opportunity to capitalize on a beneficial real estate asset," said Carter English, a corporate communications and public relations official with J.C. Penney.

"It’s never easy taking actions that directly impact our valued associates and customers, however we feel this is a necessary business decision," he added in an email to The Vindicator.

This comes in the wake of today's fourth-quarter 2018 report which showed that net income tumbled nearly 70 percent and revenue slid 8 percent, the most crucial period of the year for retailers who bank on a surge in holiday sales.

The company did beat Wall Street expectations, and shares jumped 22 percent before the opening bell Thursday.

The deteriorating sales underscore the labyrinth of challenges facing CEO Jill Soltau, who took the top job at J.C. Penney in October. Scores of retailers broadsided by a rapid shift in consumer behavior have filed for bankruptcy protection, including rival Sears and Kmart. Others have simply liquidated.

Under Soltau's leadership, the company is focusing again on women's clothing and accessories, which carry higher profit margins.

That would reverse measures undertaken by her predecessor, Marvin Ellison.

And, after a three-year venture, the retailer is again taking big appliances out of stores after it began selling them again in an attempt to capitalize on problems at Sears.

"The central problem for (J.C. Penney) is that it no longer gives shoppers reasons to visit stores and to make purchases," said Neil Saunders, managing director of GlobalData Retail. "In other words, it has lost sight of why it exists. This is evident across both stores and online where a hodgepodge of products are thrown together in a seemingly random fashion."

J.C. Penney posted net income of $75 million, or 24 cents per share, for the quarter. That compares with $242 million, or 77 cents per share, a year ago.

Adjusted per share was 18 cents per share, 7 cents better than analyst had projected, according to a survey by FactSet. Revenue was $3.78 billion, also beating expectations.

But same-store sales, a closely-watched barometer of health in the retail sector, slid 4 percent.

The Plano, Texas, company, which has been closing stores for years, said Thursday that it would turn the lights out at another 18 department stores, as well as nine home and furniture stores.

J.C. Penney will take charges of $15 million in relation to those closings during the first half of this year.

"For the past few months, I have met with and listened to J.C. Penney 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," said Soltau in a in a prepared statement. "Based on everything I have seen and heard, I am even more convinced that J.C. Penney is a revered brand that has the capacity to deliver improved results."

Saunders lauded Soltau's leadership so far, saying J.C. Penney's travails predate her. But he said time is limited.

"Ms. Soltau has noted that J.C. Penney is a revered brand, but such warm sentiments will ultimately mean little unless the company focuses on its customers," Saunders wrote.

As for the Ohio employee of the closed stores, Carter said "Eligible associates who do not transfer to another JCPenney location will receive separation benefits and all impacted associates may participate in a three hour on-site career training class, at no cost to the associate, which offers tips on resume writing, answering interview questions and more."

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