JCP Announces 2Q19 Results
On 15 August 2019, J. C. Penney Company Inc (JCP, Company) announced 2Q19 results for the three months ending 3 August 2019. JCP recorded sales of USD2.5bn, a 9% drop compared to 2Q18 on a same store basis. EBITDA improved to USD174m (USD136m 2Q18) as the Company completed its retreat from major appliances and in-store furniture categories. The Company announced it would be free cash flow positive at the end of FY19. While the Company has strong liquidity stemming from its USD1.7bn facility, it still has to repay USD4.9bn in debt. Overall, JCP recorded a net loss of USD48m, compared to 2Q18’s net loss of USD101m.
Although the results are much improved from 2Q18, JCP is still facing tough operating conditions in a struggling retail sector. JCP continues to reduce overheads and cut costs amidst an industry facing secular headwinds. The Company closed 15 stores during 2Q19, completing its announced 18 closures for FY19. Additionally, the Company reduced its inventory by 12.5% from 2Q18 on the back of improved selling margins, and increased shift toward online retail sales. However, over 80% of sales are still generated in-store.