This page has been archived and commenting is disabled.
JCP Burns $960 Million In Q1
Moments ago, the stock everyone but Bill Ackman and Goldman's loan syndication team loves to hate reported results, and they are, as usual abysmal. On the top line, the company announced that total sales declined by 16.4% from Q1 2012's $3.152 billion to just $2.635 billion, a 16.4% decline. The company provided mea culpa is as follows: "The sales decline in the first quarter is partially attributable to construction activities in connection with the transformation of the home departments in 505 stores. The Company noted that results for the quarter also reflect its prior pricing and marketing strategies, which are being changed under new leadership." Well, there's that. There is also that fewer and fewer people know what JCP is (except for the vulture funds who just can't wait to snap up the real estate at the stalking horse auction), let alone shop there.
More importantly, the company provided a liquidity update, which was as follows: "The Company estimates cash and cash equivalents to be approximately $821 million as of May 4, 2013. Total debt is expected to be approximately $3.818 billion as of May 4, 2013, including amounts outstanding on the revolving credit facility of $850 million, long-term debt of $2.868 billion, and capital leases and notes payable of $100 million."
What does this means for the company's all important cash burn rate? Since the reported cash and equivalents as of December 31, 2012 was $930 million, when one adds the full revolver draw of $850 million, one gets $1,780 million. So in order to get a pro forma cash number of $821 million as of May 4, it means the company burned $959 million between January 1 and May 3, 2013. This is roughly in line with what we expected when we presented the pro forma JCP cap table and is in accordance with JCP's historical net working capital (i.e., inventory) rebuild.
The good news: Q1 is the heavy cash burning period for the company, although it is very likely that the cash burn will accelerate in the coming quarters as the operational strategy is once again adjusted this time under newer new management. The not so good news is that the virtually all the unencumbered collateral in the company has been secured by various pieces of debt. We assume total merchadnise inventory will be roughly $3.2 billion as of the end of the quarter as well. So adding the drawn revolver with the recent Goldman Term Loan which will add another $1.75 billion in encumbrance, and recoveries to bond holders are starting to look very, very shaky.
However, with pro pro forma cash of $821 million + $1.75 billion from the new Term Loan, JCP should have some 12-18 months of breathing liquidity, unless of course, the payables of $2.5 billion become a use of cash, as vendors demand COD. In that case, the company may have about 1 year in dry powder before it has to retain not Blackstone's refinancing team as much as its bankruptcy advisors.
»
- 8049 reads
- Printer-friendly version
- Send to friend
- advertisements -
they got nothin on Bernanke!
ADVERTISEMENT
_____________________________
There has never been a better time
to buy a
Steve Harvey®
White Linen-Look Suit Vest
$80.00 original
$39.99 sale
Hurry now to your local
J.C. Penney store
before they run out of cash
to pay their vendors!
Faggy white belt, white linen-look pants, and violet shirt sold seperately.
no that's pimpish - pimpin!
where is the "Dow 15,000" diamond laced belt and buckle????
fuck me i hate all this shit............
Another bullish sign? What a joke! When most of the nation cant even afford food, you are not going to buy some new junk at JCP. Unless Obama can supply the nation with some sort of food stamps for JCP.
I have the big idea...a vest, within a vest!
And speaking of burning through a Billion a quarter... here's an even better idea...
Bulletproof and flameproof business suits. Only at JCP (and JPM perhaps)
They could call it the new "Wall Strret line" of business attire...
Dude, it's all about the shoes and running fast.
You may have a valid point there but I doubt Jamie and Lloyd could outrun a former NBA hopeful with a serious bling shortage and a big knife...
JCP JP's (Jetpacks) for the 1% then?
Did somebody get busted?
Well I started to hate going into these department stores (more than before) when they bunched goods by brand name.
Put the freakin' pants in one area and the freakin' shirts in one area so I don't have to run over all over the damned store !
And hire more than one employee for each floor, you cheap bastards ! Theyre ringing up my slacks in the freakin' watch department. (Years ago I'd sometimes find casual slacks and shirts there, but havent been in a Penneys for a very long time.)
I really hate shopping . . . JCP better hire strippers as store clerks if they want me in their stores.
Today's man would look fantastic in this ensemble sitting behind the wheel of his just purchased GM Suburban on the 9 year financing plan. The clothes will not go out of style and the GM will not break down in 9 years.
Life is good.
Brick & Mortar cash burn scenario taking place. Let’s make the muppets self-check-out. What? Why aren’t they fucking showing up for the empty customer service we’re offering?
If we just continue to demoralize our customers, they’ll return back to our stores. You can bank on it once the law is written for us… Don't worry folks, this bill is DOA in the House.
"Faggoty"? Really?
You can make fun of the guy wearing a bow tie, a pocket square, or a checkered shirt (or all three if they're doing the Douchebag Trifecta). You can intimate that women dress like trollops. You can even say that the 280lb guy from IT who sweats gravy got his gray suit from the Hindenberg, but you cannot - EVER! - make fun of homosexuals.
Rule 1: Homosexuals are a special, privileged, class entitled to special protections who can do absolutely no wrong, ever.
Rule 2: If Rule 1 doesn't seem to work, repeat as necessary or endure hours of "Sensitivity Training" and/or unemployment until it does.
But you must admit, they present a better picture than Bernanke with nothing on.
Won't be long now.
With all the cheap cash flying around somebody will buy it up cheap and strip the bones...afterall a flagship brand can't be worth nuthin' < oops...excuse my Montgomery Wardism >
Surely Simon has other tenants lined up.
GoodWill
Salvation Army are ready to pick up the JCP mall space.
what's that in yuan?? that's where it went
now that CEo's are compensated for how much they can crash their company for, the new motto on the plaque over the door reads;
<go BIG and GO HOME>
Shit, the bernanke burns 85 billion in a month.
Uncle Ben burned 250 B in the quarter...that we know of
As long as no one realizes that is 90B more than existed when gold was at $800 in 1981, everything will be cool.
Exactly.
Maybe Benny can give them a bailout
Multinationals are a bankers and politicians playground. A few narcists, a bit msm, a Soros pump, and yes, you are eating a muleburger with a 18% mcCheese. But you have to, because your 401k needs you.
JCPenny, or whatever, is just one of the companies eating out your ass.
So you don't have to take a shit anymore.
Cocaine's a helluva drug.
I'm R(on)ick J(ohnson)ames bitch!!!
I have to say this.
I bought my first rifle from JCPenney.
Yup that is right! It was a Marlin Bolt action .22lr. It had a 5 round detachable magazine with a scope. I still have it, after all these years! However, with that said, there is NO reason for me to go into a JCPenney's....EVER! Since these knuckleheads thought that the female market was the way to go, they leftout the OTHER 50% that would go into their stores. Their anti-gun stance is bewildering, but since they chose to hose the folks who have money by having a stupid market model, well, they deserve to o the way of Montgomery Wards and a whole host of business's that have had stupid market models.
If its stupid but works, it ain't stupid!
I saw a recommendation that they should settle the stupid Martha Steward lawsuit and merge into a low-end brand of Macys that can compete at a level of Target with Macy's aftermarket brands, kind of like an Armani Exchange - Non-union employees under the Macy's umbrealla where Macy's could send stuff that doesn't sell to smaller towns and sell at a markdown from its retail stores in the bigger cities/more expensive malls.
The guy said they could market it under the brand "Macy's Hometown" and then use Macy's distribution centers, logistics, etc. Seemed like pure genius when I saw it.
WAMO556 - - - Now theres a winning strategy for JCP.
Part 1 -- Sell guns, and more importantly, sell lots of ammo to go with them.
Part 2 -- (See my earlier comment) Hire strippers as store clerks. Gun knowledge is a plus, but many of us already know what we want.
P.S. - I rememberi ordering a M1 carbine from Sears by mailorder.
The 10,000 pound gorilla is that "gay friendly" is yet to work its way into Kansas and Nebraska. Nobody wants to acknowledge it; nobody wants to report it, but that whole episode eviscerated J.C. Penney among its core customer base who "tolerate" gays plenty, but are getting sick of having it waved in their face all the time by the Coastal Elites.
We'll know if there's a real change at J (Gay?) C. Penney if they do another set of "My Two Moms" ads for Mothers' Day.
Flast Alert to the financial press and Goldman Sachs analysts: it wasn't the bloody coupons, at least not to Sunday School Moms from Fumblebuck, Iowa.
My wife has a JC credit card she has had for some 30 years. It started out with Ellen the degenerate and my wife backed off but the mothers day and fathers day did her in. Toss the card and that was the last visit. No one has stated this until I saw your post and you are 100% correct. Live your life as you will, great, but jam it down people's throat and your outta here. I would guess that it might be pulling the plug this year. It was an American institution for many years and middle America shopped at JC. In less then 1 year, Akman with his idiot choice and stupid marketing destroyed an icon.
Anybody who grew up in the Midwest knew the whole gay-themed ad campaign was a gut shot to an already dying man the minute we saw it. But only a few of us had the sense to act on it. And fewer still dared to share the reasoning in places like New York and Greenwich, where daring to say anything that could even remotely be interpreted as "homophobic" can get you marched into HR for weeks long "sensitivity training" or simply fired.
But, hey, short interests ruled and I made a crapload.
Thanks, "Dads!"
The gay thing, just makes me laugh my ass off. Not in a prejudice way, but at the "useful idiots" of the religious right.
They use government as their "hate surrogate" to impose their views--"homosexuality bad"--on others.
Of course government always accomplishes the opposite of the stated goal so homosexuals are all out in the open and on TV and having parades and it's a "lifestyle." Oops! Then the same government they "rah-rahed" for sends their kids overseas to kill or be killed--"Johnny sure is not the same since Iraq, but at least those dastardly homos can't marry." LOL
And of course, ultimately all of us pay because those in government have just used the whole thing to grab more power and money from us while turning gays into a bought and paid for "interest group" to use against all the rest--class-warfare.
Disclaimer: If you are not violating my natural rights of Life, Liberty and Property, I could give a shit about what you do, who you do it with and who you love. hujel
Geez - I havent walked into a JCP store for at least 5 years. Sounds like they really screwed up that place.
"My Two Moms" ads ? Really ? What next ? Strap ons for sale ?
Personally, I don't give a rats azz what someone else does as long as they don't mess with me & my Liberty.
But as a marketing strategy, it shows profound levels of stupidity. Maybe I'll look for future shorting opportunities on JCP.
Wow... that's sad. Even in crisis battered countries like Greece they still have real trees left... to burn: Greeks Raid Forests In Search Of Wood To Heat Homes - http://www.zerohedge.com/news/2013-01-14/greeks-raid-forests-search-wood...
Internet is down all across Syria... some serious shit might be about to go down...
One of two things:
1) a goat ate through an optical cable, or;
2) The NSA took them down in preparation for a wave of drone and cruise missile hits against C&C nodes.
I'm betting on the goat. Little bastards get into everything.
Don't short yet! I bought several pairs of socks at JCP today, and the sale has yet to be factored in.
If this sort of thing continues, the consumer sector will be cut off from stuff to consume. The GDP is going to suffer.
This is getting serious. Get those helicopters in the air!
JPM burned millions for billions...
JCP & the US have a lot in common
But JPC can't print their own money to save themselves and temporarily fool everyone into thinking everything is alright. So they should change their whole approach immediately to save themselves. Screw happy ads and the pussy ass attempts at relaunch.
Rebrand and go to 100% fear based selling.
Make me CEO and I'll guarantee a huge profit by Q3 & expansion by Q4
I will take no salary and no bonus. No golden parachute. Only 100% comp in stock and options or gold equivalent value.
Rebrand JCP = Judeo Chrisitan Preppers
New Motto: Save America Save Yourself Save JCP
Our focus will be the usual prepper stuff gold, silver, guns and ammo, cammo and survival clothes, stored food, seeds, etc
So no real name change needed, re-branding will happen virally with no expense & only slight cheap changes needeed to ads and marketing campaigns. For example, dub in the word Guns instead of Pants on this Ad
http://www.youtube.com/watch?v=QKsp6At6Rtw
parachuttes went up in price I see...damn...!!
dead store walking
I see dead malls.
.....another victim of the internet machines
The top fifty paid executives will ride this pig off the cliff in 18 months or less. It will be pillage and burn, lining their pockets along the way.
Hopefully the US government dumps billions into this piece of shit before it goes supernova. Fuck 'em all.
The 21st century USA has little need for stores that cater to the middle class, because their customer base is disappearing {or dying off}. Look at Sears. Who shops there anymore? If it were not for the Craftsman and Kenmore brands, they would have gone tits up by now. Their typical customer is over 55 years of age. That demographic does not shop much. They have lost the teenage to 35 shopper forever {those are the uber shoppers everybody wants}. Sears has squandered allot of legacy $ on the Kmart acquisition, trying in vain to compete with Walmart. They still have some coin to burn through, as they were THE place to shop for many decades. But before too long, they too will go the way of the dinosaur. There are many, many more brands to disappear before this all plays out. I was amazed so many kept it together during the 2007-9 crisis years. Should have bought Pier One when it was at six cents. Can't believe that one survived. I would have been a billionaire today if I had. Makes me sick just thinking about it. Did make some $ shorting it down thought.
Sears is run by the same 'NYC incompetency' that's controlling JCP. They think all you need, to be successful, is a whole lot of free counterfeit 'Bernie Bucks'. This is part of their 'steal everything not nailed down' strategy.
The real estate is good....can house all the new Obama Clinics soon to open..or is that the mortuarys....whatever..healthcare is healthcare right...
It will be interesting to see where they will get the Doc from when they are leaving their medical practices in droves. Who wants hundreds of thousands of student loan debt, only to work in an industry where their are price controls?
only 960million? Hell, Larry Ellison burned a quarter of that buying up 20 malibu properties.
Going to be tragically fun to watch the spin, lies and BS from the pols and crats when they announce that they're done and all 116,000 employees are now on the govtit.
But then my bet is they will have Buffet or some other "white knight" swoop in and "save" them. hujel
Cash burn? Really? Hahahahahaha. Not on inventory or staff.
My mother has been in JCP's a few times recently. Came out empty-handed every time. She said the place was nearly devoid of anything to buy. Had to hunt down a clerk. One day she arrived a few minutes past opening time but couldn't get in. After a delivery man beat on the door, a woman appeared and told them that the staff members were in a meeting so the people would have to wait.
Hmm. Let's see.
No inventory.
No sales force.
No attitude.
Diagnosis: Dead but in denial.