J. C. Penney To Close 33 Stores, Lay Off 2,000 Jobs

(RTTNews) - J. C. Penney Co. Inc. (JCP) Wednesday said it will close 33 under-performing stores and lay off 2,000 employees as the struggling department store chain strives to reinvent itself.

The Plano, Texas-based company said the closure and lay offs will help the company to focus more on potential growth areas.

J C Penney expects these plans to save about $65 million a year beginning in 2014. However, the closures and job cuts will result in pre-tax charges of about $26 million in the fourth quarter and $17 million in future periods.

"As we continue to progress toward long-term profitable growth, it is necessary to reexamine the financial performance of our store portfolio and adjust our national footprint accordingly," said Chief Executive Myron Ullman.

The company said the remaining inventory in the affected stores will be sold over the next several months, with final closings expected to be complete by early May.

Meanwhile, the company is continuing its plans to open a new store location later this year at the Gateway II development in Brooklyn.

Last week, Macy's Inc. (M) had also announced its plans to lay off about 2,500 jobs as part of its cost cutting measures.

JCP closed Wednesday's trading at $7.01, up $0.08 or 1.15%, on the NYSE. The stock however dropped $0.04 or 0.57% in after hours trade.