Boston, MA 09/30/2013 (wallstreetpr) –What would you say if a company’s CEO says something, which is refuted hours later by company’s official announcement?
Strange. Disillusioned. Isn’t it?
J.C. Penney Company, Inc.’s (NYSE:JCP) CEO Mike Ullman announced on Wednesday that the company does not face any liquidity crisis and would face no problems in the coming holiday season. Coming from mouth of CEO himself, any normal person would have believed this statement. But company decided to sell shares to the tune of $1 Billion to thwart off any liquidity related concerns!!
Now was it that CEO was unaware of this development? Or is that that JCP is facing an unprecedented liquidity crisis? Answer to none of these is more important than answer to questions about survival of JCP as we know it.
As of now, the company is trying to amend a failed and miserable turnaround effort by an x-Apple executive Ron Johnson. He was the main person behind untested strategies of cutting back on discounts, coupons and doing away of popular in-house brands. Johnson misunderstood a very important difference between JCP and Apple stores. Apple buyers know what they want and it is exclusively available at Apple stores. Same is not the case with JCP, and hence the failed re-setup of the JCP stores.
As of now, JCP is trying to get back on its feet and has accumulated cash by this distress share sale for the coming holiday season. Company is bringing back old time favorites (brands) and providing them with larger than usual shelf space. Store format is being reworked, or rather restored to appeal to original and traditional buyers.
Analysts feel that some of these measures may be able to repair the damage caused by last two year’s leadership. But will JCP be able to reach its past glory is anybody’s guess.