Exhibit 99.1
J. C. PENNEY COMPANY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Month Ended | Four Months Ended | |||||||||||||||
June 6, | June 8, | June 6, | June 8, | |||||||||||||
(In millions, except per share data) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Total net sales | $ | 266 | $ | 1,003 | $ | 1,348 | $ | 3,442 | ||||||||
Credit income and other | 7 | 32 | 121 | 148 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total revenues | 273 | 1,035 | 1,469 | 3,590 | ||||||||||||
Costs and expenses/(income): | ||||||||||||||||
Cost of goods sold (exclusive of depreciation and amortization shown separately below) | 166 | 645 | 979 | 2,275 | ||||||||||||
Selling, general and administrative (SG&A) | 113 | 313 | 685 | 1,169 | ||||||||||||
Depreciation and amortization | 50 | 56 | 185 | 203 | ||||||||||||
Real estate and other, net | (3 | ) | 6 | (5 | ) | 1 | ||||||||||
Restructuring and management transition | 7 | 2 | 162 | 22 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total costs and expenses | 333 | 1,022 | 2,006 | 3,670 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Operating income/(loss) | (60 | ) | 13 | (537 | ) | (80 | ) | |||||||||
Other components of net periodic pension cost/(income) | (8 | ) | (4 | ) | (31 | ) | (18 | ) | ||||||||
Net interest expense | 25 | 27 | 100 | 100 | ||||||||||||
Loss due to discontinuance of hedge accounting | — | — | 77 | — | ||||||||||||
Reorganization items, net | 72 | — | 72 | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Income/(loss) before income taxes | (149 | ) | (10 | ) | (755 | ) | (162 | ) | ||||||||
Income tax expense/(benefit) | (1 | ) | 1 | (61 | ) | 3 | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net income/(loss) | $ | (148 | ) | $ | (11 | ) | $ | (694 | ) | $ | (165 | ) | ||||
|
|
|
|
|
|
|
| |||||||||
Earnings/(loss) per share - basic | $ | (0.46 | ) | $ | (0.03 | ) | $ | (2.14 | ) | $ | (0.52 | ) | ||||
Earnings/(loss) per share - diluted | $ | (0.46 | ) | $ | (0.03 | ) | $ | (2.14 | ) | $ | (0.52 | ) |
J. C. PENNEY COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
June 6, | June 8, | |||||||
2020 | 2019 | |||||||
(In millions) | ||||||||
Assets | ||||||||
Current assets: | ||||||||
Cash in banks and in transit | $ | 154 | $ | 148 | ||||
Cash short-term investments | 583 | 7 | ||||||
|
|
|
| |||||
Cash and cash equivalents | 737 | 155 | ||||||
Merchandise inventory | 2,124 | 2,398 | ||||||
Prepaid expenses and other | 300 | 297 | ||||||
|
|
|
| |||||
Total current assets | 3,161 | 2,850 | ||||||
Property and equipment, net | 3,306 | 3,626 | ||||||
Operating lease assets | 929 | 912 | ||||||
Prepaid pension | 144 | 159 | ||||||
Other assets | 626 | 662 | ||||||
|
|
|
| |||||
Total assets | $ | 8,166 | $ | 8,209 | ||||
|
|
|
| |||||
Liabilities and stockholders’ equity | ||||||||
Current liabilities: | ||||||||
Merchandise accounts payable | $ | 583 | $ | 807 | ||||
Other accounts payable and accrued expenses | 919 | 881 | ||||||
Current operating lease liabilities | 101 | 83 | ||||||
Current portion of finance leases and note payable | — | 2 | ||||||
Current portion of long-term debt, net | 4,884 | 92 | ||||||
|
|
|
| |||||
Total current liabilities | 6,487 | 1,865 | ||||||
Noncurrent operating lease liabilities | 1,080 | 1,076 | ||||||
Long-term debt | — | 3,793 | ||||||
Deferred taxes | 47 | 119 | ||||||
Other liabilities | 355 | 330 | ||||||
|
|
|
| |||||
Total liabilities | 7,969 | 7,183 | ||||||
Stockholders’ equity | ||||||||
Common stock | 161 | 159 | ||||||
Additionalpaid-in capital | 4,721 | 4,719 | ||||||
Reinvested earnings/(accumulated deficit) | (4,363 | ) | (3,566 | ) | ||||
Accumulated other comprehensive income/(loss) | (322 | ) | (286 | ) | ||||
|
|
|
| |||||
Total stockholders’ equity | 197 | 1,026 | ||||||
|
|
|
| |||||
Total liabilities and stockholders’ equity | $ | 8,166 | $ | 8,209 | ||||
|
|
|
|
J. C. PENNEY COMPANY, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)
Reinvested | Accumulated | |||||||||||||||||||||||
Number of | Additional | Earnings/ | Other | |||||||||||||||||||||
Common | Common | Paid-in | (Accumulated | Comprehensive | Total Stockholders’ | |||||||||||||||||||
(In millions) | Shares | Stock | Capital | Deficit) | Income/(Loss) | Equity | ||||||||||||||||||
February 1, 2020 | 320.5 | $ | 160 | $ | 4,723 | $ | (3,667 | ) | $ | (387 | ) | $ | 829 | |||||||||||
Net income/(loss) | — | — | — | (546 | ) | — | (546 | ) | ||||||||||||||||
Discontinuance of hedge accounting | — | — | — | — | 63 | 63 | ||||||||||||||||||
Other comprehensive income/(loss) | — | — | — | — | 1 | 1 | ||||||||||||||||||
Stock-based compensation and other | 1.4 | 1 | 2 | (2 | ) | — | 1 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
May 2, 2020 | 321.9 | 161 | 4,725 | (4,215 | ) | (323 | ) | 348 | ||||||||||||||||
Net income/(loss) | — | — | — | (148 | ) | — | (148 | ) | ||||||||||||||||
Other comprehensive income/(loss) | — | — | — | — | 1 | 1 | ||||||||||||||||||
Stock-based compensation and other | — | — | (4 | ) | — | — | (4 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
June 6, 2020 | 321.9 | $ | 161 | $ | 4,721 | $ | (4,363 | ) | $ | (322 | ) | $ | 196 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Reinvested | Accumulated | |||||||||||||||||||||||
Number of | Additional | Earnings/ | Other | |||||||||||||||||||||
Common | Common | Paid-in | (Accumulated | Comprehensive | Total Stockholders’ | |||||||||||||||||||
(In millions) | Shares | Stock | Capital | Deficit) | Income/(Loss) | Equity | ||||||||||||||||||
February 2, 2019 | 316.1 | $ | 158 | $ | 4,713 | $ | (3,373 | ) | $ | (328 | ) | $ | 1,170 | |||||||||||
ASC 842 (Leases) and ASU2018-02 (Stranded Taxes) adoption | — | — | — | (26 | ) | 53 | 27 | |||||||||||||||||
Net income/(loss) | — | — | — | (154 | ) | — | (154 | ) | ||||||||||||||||
Other comprehensive income/(loss) | — | — | — | — | (11 | ) | (11 | ) | ||||||||||||||||
Stock-based compensation and other | 0.7 | — | 2 | — | — | 2 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
May 4, 2019 | 316.8 | 158 | 4,715 | (3,553 | ) | (286 | ) | 1,034 | ||||||||||||||||
Net income/(loss) | — | — | — | (11 | ) | — | (11 | ) | ||||||||||||||||
Stock-based compensation and other | 0.3 | 1 | 4 | (2 | ) | — | 3 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
June 8, 2019 | 317.1 | $ | 159 | $ | 4,719 | $ | (3,566 | ) | $ | (286 | ) | $ | 1,026 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
J. C. PENNEY COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Month Ended | Four Months Ended | |||||||||||||||
June 6, | June 8, | June 6, | June 8, | |||||||||||||
(In millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Cash flows from operating activities: | ||||||||||||||||
Net income/(loss) | $ | (148 | ) | $ | (11 | ) | $ | (694 | ) | $ | (165 | ) | ||||
Adjustments to reconcile net income/(loss) to net cash provided by/(used in) operating activities: | ||||||||||||||||
Restructuring and management transition | — | — | 139 | 15 | ||||||||||||
Net gain on sale of operating assets | — | 7 | — | 3 | ||||||||||||
Discontinuance of hedge accounting | — | — | 77 | — | ||||||||||||
Depreciation and amortization | 50 | 56 | 185 | 203 | ||||||||||||
Benefit plans | (5 | ) | (9 | ) | (27 | ) | (23 | ) | ||||||||
Stock-based compensation | (5 | ) | 3 | (3 | ) | 5 | ||||||||||
Deferred taxes | — | — | (60 | ) | (3 | ) | ||||||||||
Change in cash from: | ||||||||||||||||
Inventory | 97 | 79 | 42 | 39 | ||||||||||||
Prepaid expenses and other assets | (28 | ) | (10 | ) | (126 | ) | (108 | ) | ||||||||
Merchandise accounts payable | 4 | (35 | ) | (203 | ) | (40 | ) | |||||||||
Income taxes | — | (4 | ) | (1 | ) | (1 | ) | |||||||||
Accrued expenses and other | 124 | (44 | ) | (54 | ) | (98 | ) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Net cash provided by/(used in) operating activities | 89 | 32 | (725 | ) | (173 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Cash flows from investing activities: | ||||||||||||||||
Capital expenditures | — | (18 | ) | (33 | ) | (89 | ) | |||||||||
Proceeds from sale of operating assets | — | 4 | — | 12 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net cash provided by/(used in) investing activities | — | (14 | ) | (33 | ) | (77 | ) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Cash flows from financing activities: | ||||||||||||||||
Proceeds from borrowings under the credit facility | — | 221 | 1,950 | 629 | ||||||||||||
Payments of borrowings under the credit facility | — | (255 | ) | (771 | ) | (545 | ) | |||||||||
Payments of finance leases and note payable | — | — | (1 | ) | (1 | ) | ||||||||||
Payments of long-term debt | — | — | (19 | ) | (11 | ) | ||||||||||
Debtor-in-possession financing costs | (50 | ) | — | (50 | ) | — | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net cash provided by/(used in) financing activities | (50 | ) | (34 | ) | 1,109 | 72 | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase/(decrease) in cash and cash equivalents | 39 | (16 | ) | 351 | (178 | ) | ||||||||||
Cash and cash equivalents at beginning of period | 698 | 171 | 386 | 333 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Cash and cash equivalents at end of period | $ | 737 | $ | 155 | $ | 737 | $ | 155 | ||||||||
|
|
|
|
|
|
|
|
(1) | 4-Wall EBITDA is an internal store performance metric, which excludes most corporate overhead and other fixed allocated costs. Monthly 4-Wall EBITDA numbers do not reflect certain allocations made only on an annual basis. |
(1) | Operating Profit is an internal store performance metric, which excludes most corporate overhead and other fixed allocated costs. |
(1) | Controllable expenses include store salaries, facilities expenses and utilities expenses, among others. |
(1) | Noncontrollable expenses include expenses relating to marketing, display, maintenance and repairs, among others. |
(1) | 4-Wall EBITDA is an internal store performance metric, which excludes most corporate overhead and other fixed allocated costs. Monthly 4-Wall EBITDA numbers do not reflect certain allocations made only on an annual basis. |
(1) | Operating Profit is an internal store performance metric, which excludes most corporate overhead and other fixed allocated costs. |
(1) | Controllable expenses include store salaries, facilities expenses and utilities expenses, among others. |
(1) | Noncontrollable expenses include expenses relating to marketing, display, maintenance and repairs, among others. |
(1) | 4-Wall EBITDA is an internal store performance metric, which excludes most corporate overhead and other fixed allocated costs. Monthly 4-Wall EBITDA numbers do not reflect certain allocations made only on an annual basis. |
(1) | Operating Profit is an internal store performance metric, which excludes most corporate overhead and other fixed allocated costs. |
(1) | Controllable expenses include store salaries, facilities expenses and utilities expenses, among others. |
(1) | Noncontrollable expenses include expenses relating to marketing, display, maintenance and repairs, among others. |
(1) | 4-Wall EBITDA is an internal store performance metric, which excludes most corporate overhead and other fixed allocated costs. Monthly 4-Wall EBITDA numbers do not reflect certain allocations made only on an annual basis. |
(1) | Operating Profit is an internal store performance metric, which excludes most corporate overhead and other fixed allocated costs. |
(1) | Controllable expenses include store salaries, facilities expenses and utilities expenses, among others. |
(1) | Noncontrollable expenses include expenses relating to marketing, display, maintenance and repairs, among others. |