Penney’s CEO Spells Out the Challenges Ahead

J.C. Penney Co. is taking its medicine and it’s not going down easy. The $12 billion middle American department store chain reported losses and negative comparable sales for the first quarter of 2019 and continues to slash inventories and close stores. But Penney’s is nearly done rebuilding its leadership, has begun testing ideas around assortments, and is redesigning “core” store processes such as checkouts and labor efficiencies to improve the shopping experience. Penney’s also maintains a positive cash flow and will be able to meet modest debt maturity obligations of about $50 million this year and $110 million in 2020. “Sometimes the business can get a little bit worse before it gets better. This year, we are focused on re-establishing what we need to,” observed Jill Soltau, Penney’s chief executive officer, discussing the retailer’s state of affairs. Soltau, the company’s ceo since last October, has been deep into learning what changes must be made for the business to survive, and how to reconnect with customers and give them what they want from the store. On Tuesday, Penney’s reported a net loss of $154 million for the first quarter ended May 4, almost double the year-ago loss of $78 million. Comparable sales decreased 5.5 percent, and are

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