J.C. Penney Co.’s chief executive officer Myron “Mike” Ullman 3rd says the company has taken on three big growth initiatives — the home store, omni-channel, and the center core which includes fashion and fine jewelry, accessories, intimates, footwear and Sephora.
Ullman outlined the initiatives at the firm’s analysts meeting in New York, updating progress in the company’s turnaround bid.
Ullman was Penney’s ceo from December 2004 until February 2012, when the company showed signs of slipping, and was replaced by Ron Johnson, who triggered a sweeping reinvention program that had the company losing billions in revenues and millions of customers, and spiraling towards bankruptcy. Ullman returned to Penney’s as ceo in April 2013 to salvage the company.
“We’ve stabilized the financial position. We are back in key items, and definitely back in the consumer mindset,” Ullman told the analysts.
He also said private brands have been restored and enhanced, a number of brands and merchandise that “clearly didn’t resonate” were dropped, and that 505 home departments have been remerchandised. “The turnaround has been strong and consistent. We see additional opportunity for improvement.”
He characterized omni-channel as “critical to growth” and said the “rebuilt” dot.com is on a positive trajectory, growing each quarter.
“Our core custemers have returned. In July, we had virtually the same number of customers we had in 2011,” Ullman said.
Enormous challenges remain, not the least of which is getting consumers to spend more. “Despite the fact consumer confidence is increasing, spending is still flat. It’s not clear when it will change,”Ullman said.
“We count half of America’s families as our customers. We need to increase the share of wallet they spend with us.”
Penney’s continues to lose money, but in the three months ended Aug. 2, the Plano, Tex.-based midtier department store chain cut its net loss to $172 million, from the $586 million loss recorded in the second quarter of 2013. Penney’s slightly exceeded revenue expectations with sales improving 5.1 percent to $2.8 billion from $2.66 billion a year ago, compared to the $2.79 billion in sales expected.
“The warrior spirit has invaded our company. I suggest you don’t take it lightly,” Ullman said.