The closings will result in a charge of approximately $275 million on apre-tax basis, or about $0.68 per share after-tax, in the fourth quarter ending Jan. 27, according to officials of the Plano, TX-based retailer. The cash charge consists of $185 million for JC Penney and $90 million for its Eckerd drugstores.
JC Penney is closing 44 under-performing department stores and threecatalog outlet stores, which occupy approximately 4 million sf. The majority of the stores will close in the first half of 2001. Theannualized sales impact from the closings is expected to be about $350million and about $230 million for 2001. Approximately 5,000 employees will be affected by the closings but the company says many of them will be offered positions in other stores.
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