Company outlines
performance goals to deliver $1.40-1.55 earnings per share in
2019
PLANO, Texas -
(Aug. 17, 2016) - At its 2016 analyst meeting in Las Colinas,
Texas, J. C. Penney Company, Inc. (NYSE: JCP) today presented a
three-year plan for accelerated growth and outlined its financial
expectations for improved performance beyond 2017.
"Since becoming CEO a year ago, the team and I
have made considerable progress balancing the art and science of
retail by improving our execution in omnichannel, marketing, store
operations, supply chain and merchandising," said Marvin R.
Ellison, chairman and chief executive officer of JCPenney.
"There is still much work to do, but I am confident that our focus
on sales growth, new technology and expense management will
continue to accelerate our turnaround and create shareholder
value."
Building Value
and Differentiation Through Private Brands, Home and
Beauty
JCPenney is committed to providing customers with compelling
merchandise and exclusive shopping experiences that create lasting
loyalty. To deliver on its value proposition to shoppers, the
Company will drive private and exclusive brand penetration up to 70
percent of total merchandise sales by 2019. This target will
be achieved by eliminating labels that are no longer relevant and
expanding popular existing brands to additional categories. To
further differentiate JCPenney from brick-and-mortar and online
competition, the Company will maximize opportunities in three
specific merchandise strategies:
-
Special Sizes: Growing the
special sizes offering by leveraging in-house design and trend
teams to deliver quality plus size, petite and big & tall
apparel that meets the lifestyle needs of various ages and diverse
body types.
-
Home Refresh: Revitalizing
the JCPenney Home store to entice customers seeking to update their
homes, including rolling out major appliance showrooms to nearly
500 locations and jcp.com, testing Empire Today flooring in three
markets and adding Signature Design by Ashley® to
the furniture assortment in select stores and jcp.com.
-
Beauty Experience: Pursuing
additional growth in Women's beauty by expanding the number of
Sephora inside JCPenney locations, accelerating The Salon by
InStyle renovations, rejuvenating center core and emphasizing fine
jewelry.
Powering a Swift
and Nimble Omnichannel Experience
JCPenney is advancing its omnichannel execution to connect with
customers how, when and where they prefer to shop. A major
component of this strategy is mobile, which is the Company's single
greatest touch point with digitally-savvy shoppers.
Bolstering this approach is a newly redesigned JCPenney app that
enables customers to locate items, apply coupons and access their
JCPenney Rewards more easily. Shoppers can also complete
their jcp.com purchases with a variety of convenient shipping and
pickup options, resulting in over 50 percent of online orders
stemming from or leading to an in-store experience:
-
Ship to any JCPenney store:
Given the Company's history of operating catalog service desks,
JCPenney is one of the few retailers today to offer the option of
shipping an online order to any one of its 1,000 stores
nationwide;
-
Same-day pickup in stores:
Over 150,000 items on jcp.com are eligible for same-day pickup at
any JCPenney store within four hours of the order being
placed;
-
Faster home delivery: In
2017, the Company will offer a standard delivery turnaround of two
business days or less to over 95% of the U.S. population.
To efficiently fill jcp.com
orders, JCPenney has made significant investments in
state-of-the-art systems that support an enterprise-wide
fulfillment strategy to minimize markdowns and improve customer
service. In addition to a network of three direct logistic
facilities, 250 stores are now capable of filling jcp.com orders
with store inventory and shipping directly to customers. This added
fulfillment option allows the Company to meet customer demand for a
particular style, color or size, while delivering orders faster
than ever.
Financial
Outlook
In light of these sales and profit enhancing initiatives, the
Company also provided financial performance estimates for the
2017-2019 period, as follows:
-
Compounded annual comparable sales growth
anticipated to be 3.0 %;
-
Gross margin is expected to improve 75-100 basis
points;
-
Additional SG&A expense leverage of 215-240
basis points;
-
Net income is expected to be between $450-500M
by 2019;
-
Earnings per share of $1.40-1.55 by 2019.
Ellison added, "Although we've
sharpened our priorities for the next three years, our strategic
framework remains the same. The entire team - from stores to
supply chain to the home office - is squarely focused on delivering
an unparalleled omnichannel experience, powerful private brands and
increased revenue per customer. Under this framework, we are
taking market share, outpacing competitors and improving the long
term profitability of our business."
Media
Relations:
(972) 431-3400 or jcpnews@jcp.com or follow us @jcpnews
Investor
Relations:
(972) 431-5500 or jcpinvestorrelations@jcpenney.com
About
JCPenney:
J. C. Penney Company, Inc. (NYSE:JCP), one of the nation's largest
apparel and home furnishings retailers, is on a mission to ensure
every shopping experience is worth the customer's time, money and
effort. Whether shopping jcp.com or visiting one of over 1,000
store locations across the United States and Puerto Rico, customers
will discover a broad assortment of products from a leading
portfolio of private, exclusive and national brands.
Supporting this value proposition is the warrior spirit of
over 100,000 JCPenney associates worldwide, who are focused on the
Company's three strategic priorities of strengthening private
brands, becoming a world-class omnichannel retailer and increasing
revenue per customer. For additional information, please visit
jcp.com.
Forward-Looking Statements:
This release may contain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Words such as "expect" and similar expressions identify
forward-looking statements, which include, but are not limited to,
statements regarding sales, gross margin, selling, general and
administrative expenses, earnings and cash flows.
Forward-looking statements are based only on the Company's
current assumptions and views of future events and financial
performance. They are subject to known and unknown risks and
uncertainties, many of which are outside of the Company's control
that may cause the Company's actual results to be materially
different from planned or expected results. Those risks and
uncertainties include, but are not limited to, general economic
conditions, including inflation, recession, unemployment levels,
consumer confidence and spending patterns, credit availability and
debt levels, changes in store traffic trends, the cost of goods,
more stringent or costly payment terms and/or the decision by a
significant number of vendors not to sell us merchandise on a
timely basis or at all, trade restrictions, the ability to monetize
non-core assets on acceptable terms, the ability to implement our
strategic plan including our omnichannel initiatives, customer
acceptance of our strategies, our ability to attract, motivate and
retain key executives and other associates, the impact of cost
reduction initiatives, our ability to generate or maintain
liquidity, implementation of new systems and platforms including
EMV chip technology, changes in tariff, freight and shipping rates,
changes in the cost of fuel and other energy and transportation
costs, disruptions and congestion at ports through which we import
goods, increases in wage and benefit costs, competition and retail
industry consolidations, interest rate fluctuations, dollar and
other currency valuations, the impact of weather conditions, risks
associated with war, an act of terrorism or pandemic, the ability
of the federal government to fund and conduct its operations, a
systems failure and/or security breach that results in the theft,
transfer or unauthorized disclosure of customer, employee or
Company information, legal and regulatory proceedings and the
Company's ability to access the debt or equity markets on favorable
terms or at all. There can be no assurances that the Company
will achieve expected results, and actual results may be materially
less than expectations. Please refer to the Company's most
recent Form 10-K for a further discussion of risks and
uncertainties. Investors should take such risks into account and
should not rely on forward-looking statements when making
investment decisions. Any forward-looking statement made by us in
this press release is based only on information currently available
to us and speaks only as of the date on which it is made. We
do not undertake to update these forward-looking statements as of
any future date.
###
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: J. C. Penney Company, Inc. via Globenewswire
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