J.C. Penney reopened 150 stores in 27 states after temporary closures due to COVID-19, including the only Utah County location.
The Provo Towne Center, which houses the store, announced that the venue would reopen for the first time in over a month on Wednesday.
According to a press release by J.C. Penney, the company expects to have about 500 stores back in operation by June 3.
“To do this, we’re operating differently and taking a strategic and consistent approach, keeping associate and customer safety as our top priority,” said Jim DePaul, J.C. Penney’s executive vice president, in a statement. “We are excited to welcome back our loyal customers and dedicated associates.”
The company is monitoring guidelines released by the Center for Disease Control while also taking into account mandates from local and state governments, putting in place precautions that abide by each of the recommendations throughout the store locations.
Masks, gloves and hand sanitizer have been provided to company associates, which help “promote a health work and shopping environment,” according to the press release.
Additionally, J.C. Penney has staggered shift schedules to minimize contact between associates while enhancing store learning and adding Plexiglass shields at registers. Social distancing is expected, and safety signage has also been posted.
Like several other stores and restaurants, J.C. Penney has also implemented contactless checkout and curbside pickup at no extra cost. Designated shopping hours for at-risk customers have also been announced.
From 11 a.m. to noon on Wednesdays and Fridays, people considered at-risk by the CDC — including people over the age of 60 years old, pregnant woman and those with pre-existing conditions — can shop.
Despite reopening hundreds of locations, the company is facing financial turmoil behind the scenes.
J.C. Penney has been in operation for about 118 years with almost 850 stores and about 85,000 employees across the United States and Puerto Rico. After reporting billions of dollars in losses from 2011 to 2018, the company saw a wave of closures in 2017, with about 140 stores announcing their closings.
These closures did not affect any Utah locations.
Almost two weeks ago, the nationwide company based in Plano, Texas, entered into a restructuring support agreement with lenders on May 15, voluntarily filing petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in Tax courts.
The restructuring support agreement is between J.C. Penney and the lenders that hold about 70% of the company’s first lien debt.
The plan is meant to develop terms for a pre-arranged financial restructuring plan to reduce the company’s debt, which is several billions of dollars. The plan is also expected to increase financial flexibility and help J.C. Penney create a long-term plan.
“Until this pandemic struck, we had made significant progress rebuilding our company under our Plan for Renewal strategy — and our efforts had already begun to pay off,” said Jill Soltau, J.C. Penney’s chief executive officer. “While we had been working in parallel on options to strengthen our balance sheet and extend our financial runway, the closure of our stores due to the pandemic necessitated a more fulsome review to include the elimination of outstanding debt.”
J.C. Penney was given the go-ahead from the U.S. Bankruptcy Court to access about $500 million in cash collateral.
The court also authorized the company to continue paying non-furloughed associate wages, provide benefits to all associates, and to pay vendor partners in the ordinary course for all goods and services provided on or after the Chapter 11 filing date.
J.C. Penney plans to seek authorization to access an additional $900 million in funds associated with debtor-in-possession financing, including $450 million in new money.
In the meantime, the company is looking to permanently close 29% of its retailers, according to documents filed with the Securities and Exchanges Commission on May 18.
This year, the company is planning to close 192 stores, including six closures announced in February, and extending those closures by another 50 in 2021. These closures will leave J.C. Penney with just over 600 locations remaining.
A list of closure locations has yet to be determined, but a better idea of locations is expected to be released to the courts on June 4.
At this time, there are eight J.C. Penney locations across the state, including in Provo, Layton, Logan, Riverdale, St. George, Sandy, South Jordan and West Valley City.