JCPenney plans more closures amid slumping sales

JCPenney announced it would close 27 stories during the second quarter of 2019.
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JCPenney announced it would close 27 stories during the second quarter of 2019.

Credit: Drew Angerer/Getty Images

Credit: Drew Angerer/Getty Images

JCPenney will close 27 of its 860 stores this year, a result of continuously dropping profits.

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The closures will include three previously announced department stores, 15 more full-line department stores and nine home and furniture stores, the company said in a statement Thursday. Nearly all of the impacted stores are expected to close during the second quarter of 2019.

Comparable sales at JCPenney fell 4 percent in the fourth quarter of 2018, down a total 3.1 percent for the year. Net sales for the fourth quarter dropped 9.5 percent. The company's net loss of $255 million far exceeded its $75 million net income for the quarter. Net income was $242 million the same quarter of the previous year.

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"In spite of our past financial performance, we have already taken meaningful steps to drive improvement in key businesses such as women's apparel, active apparel, special-sized apparel and fine jewelry," said Jill Soltau, CEO of JCPenney.

The stores set for closure require significant capital, don’t yield the profits of other stores or offer the company a way to make money on a real estate transaction, according to the statement. Employees impacted by closing stores will receive separation benefits including assistance in finding a new job and outplacement services.