J.C. Penney Co. Inc. (NYSE: JCP) announced Monday morning that the company on Friday received a notice from the New York Stock Exchange that it no longer meets the exchange’s criteria for a continued listing. The company has failed to maintain an average closing price per share of $1.00 for a period of 30 consecutive trading days.
J.C. Penney has six months to return to compliance and may seek an extension if the company should decide that shareholder approval is required to take action to meet the share price requirement.
In its announcement, J.C. Penney said that it intends to regain compliance by pursuing measures that may include a reverse stock split, a measure that would require shareholder approval.
In a separate announcement, J.C. Penney said it had appointed six “accomplished vice presidents” that CEO Jill Soltau said, “will champion us through our Plan for Renewal.” Four of the six are joining the marketing team that reports to Executive Vice-President and Chief Customer Officer Shawn Gensch.
Wendy Santana has been appointed as Vice President of Business Development after a 20-year stint at supply chain management firm Li & Fung. She will report to Executive Vice President Truett Horne.
The four new vice presidents reporting to Gensch are Jill Feldman, Vice President of Marketing; Roger Worak, Vice President of Customer Engagement and Insights; Dan Matarelli, Vice President of Digital Marketing; and Robin Beuthin, Vice President of Creative Marketing.
Jeff Csuy has been appointed as Vice President of Merchandise Strategy and Operations. He will report to Michelle Wlaslo, executive vice president and chief merchant.
As we noted earlier this year, the big challenge for J.C. Penney will be time. Can new management implement fixes quickly enough to turn around the relentlessly shrinking share price? Will investors be patient? How will they react to a reverse split? Will the company have to close more stores? Will it have to sell off some of its $3.5 billion or so in real estate? Can it raise its free cash flow to pay down more than $3 billion of indebtedness?
J.C. Penney stock closed down about 4.8% on Friday at $0.75 and traded down more than 2% early Monday at around $0.73. The consensus 12-month share price on the stock is $0.89, not enough to maintain its NYSE listing.
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