J.C. Penney Co. (NYSE: JCP) announced that its holiday sales fell more than expected during the crucial holiday season period. The company reported that its same-store sales fell 3.5 percent on an adjusted basis for the nine weeks ended Jan. 5. Without the adjustment, the results were even worse, with same-store sales falling 5.4 percent.
Investors were worried holiday sales would be poor at the department store chain, despite the retail industry being on track to have its best holiday shopping season in six years. The company has been struggling with a pile-up of unsold inventory, which has put pressure on its profits. There are signs that the issue continued to be a problem during the holiday season.
Penney has been having great difficulties in its attempts to turn its business around. The company is saddled with almost $4 billion of debt, the majority of which comes due between now and 2025. Its shares have lost more than 67 percent over the past year, and recently traded below the $1 mark.
New chief executive officer Jill Soltau, who took the helm in October, has pledged to conduct an ongoing evaluation of the company’s performance and to make adjustments accordingly. As part of that evaluation, the company is conducting a broad review of its retail footprint. It said in a statement it is “assessing locations that may not meet required financial targets” as well as ones where the real estate would be particularly valuable.
The company has already announced that it plans to close three stores by the spring and that it may announce more store closures next month. Penney didn’t specify which stores it planned to close. The company said more information about the closures would be provided when it reports fourth-quarter results on Feb. 28.