PENNEY’S CUTS QUARTERLY DIVIDEND TO BOLSTER ITS DEPARTMENT STORES

PENNEY’S CUTS QUARTERLY DIVIDEND TO BOLSTER ITS DEPARTMENT STORES

NEW YORK — J.C Penney Co. said Monday it’s cutting its quarterly dividend by almost 50 percent to 28.75 cents a share to invest more in its struggling department stores.
Penney’s shares lost 5/8 to close at 20 1/2 on the New York Stock Exchange Monday. James E. Oesterreicher, chairman and chief executive, said in a statement, “The dividend rate allows us to have a dividend payout competitive with our peer group while allowing us to reinvest a significant portion of our earnings to strengthen all of our businesses’ operations, including updating our traditional retailing formats, continuing to strengthen and grow our drugstores and expanding our e-commerce business.”
Penney also closed the sale of its credit card business to General Electric Capital Corp. for $4 billion and will use the proceeds to reduce debt, which currently stands at about $7 billion.