JCPenney is cutting another 360 jobs, including 130 positions from its corporate office in Plano, Texas and another 230 from its group, regional and support teams in stores. The cuts are part of the department store’s restructuring, and come less than a month after the company announced it would lay off 670 employees when its Wisconsin distribution center shuts down July 1.
The announcement coincided with the company’s Q4 earnings results, which saw revenue rise 1.8% year-over-year to $4.03 billion, and comparable sales rise 2.6%. Net income was $254 million, or $0.81 EPS, helped in part by a $75 million tax benefit. However, the retailer posted a loss of $0.37 cents per share for the full year, due mainly to restructuring charges from its 138 store closures.
Despite the holiday season giving a much-needed Q4 boost, Wall Streetwasn’t impressed. Shares of JCPenney plunged nearly 10% in early trading on March 3. For 2018, the company revealed it expects comparable store sales to range between flat and a 2% increase. Additionally, the retailer is projecting weak, but positive, earnings of $0.05 to $0.25 per share.
JCPenney plans to continue pivoting its business via beauty, appliance and home offerings. The retailer is opening approximately 30 Sephora locations within its stores in 2018, bringing its total to approximately 670 locations. The retailer boosted appliances sales in Q4 by 30%, increased comparable sales of mattresses approximately 60% and saw comparable revenues increase 40% for furniture.
JCPenney Reorganizes Executive Team
Michael Amend, EVP of Omnichannel and one of CEO Marvin Ellison’s first hires to instill the company’s omnichannel focus, is leaving the company. Upon Amend’s departure, Therace Risch will assume the combined titles of Chief Information Officer and Chief Digital Officer to reflect her added responsibility for omnichannel retail.
As part of the realignment of the senior leadership team, JCPenney has appointed Joe McFarland as EVP and Chief Customer Officer, a newly expanded role that includes responsibility for merchandising as well as leading all JCPenney store operations. Additionally, Jodie Johnson has been promoted to Head of Merchandising for women’s, beauty and family footwear; and James Starke has been promoted to Head of Merchandising for men’s, children’s, home and jewelry, both reporting to McFarland.
The department store anticipates saving approximately $20 to $25 million per year from the reorganization and the job cuts.