J.C. Penney releases list of 138 store closures, including 7 Michigan stores
Stores to begin liquidation on April 17
J.C. Penney released the list of stores that would be closing in 2017.
The retail giant announced the closures in February, but the list of which stores was made public this week.
Of the 138 stores slated to close, 7 of them are in Michigan. Liquidation of stores is set to begin in April.
- Lakeview Square Mall Battle Creek MI
- Delta Plaza Escanaba MI
- Westshore Mall Holland MI
- Copper Country Mall Houghton MI
- Birchwood Mall Kingsford MI
- Midland Mall Midland MI
- Cascade Crossings Sault Ste. Marie MI
The company says about 5,000 positions nationwide will be impacted by the store closures.
Here's part of the release explaining the impact on the company:
The total store closures represent approximately 13 - 14 % of the Company's current store portfolio, less than 5% of total annual sales, less than 2% of EBITDA and 0% of net income. The stores identified for closure either require significant capital to achieve the Company's new brand standard or are minimally cash flow positive today relative to the Company's overall consolidated average. Comparable sales performance for the closing stores was significantly below the remaining store base and these stores operate at a much higher expense rate given the lack of productivity. Once cycled, these closures are expected to be net income neutral.
The annual cost savings resulting from these strategic decisions, primarily occupancy, payroll, home office support, corporate administration and other store-related expenses, are estimated at approximately $200 million. During the first half of 2017, the Company expects to record an estimated pre-tax charge of approximately $225 million, primarily lease termination obligation expenses, non-cash asset impairments and transition costs, in connection with this initiative.
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