(Answered)-Find the 2013 Income Statement. Create a chart in Excel using the - (2025 Updated Original AI-Free Solution

Question

1. 1. 1. 1. 1. Find?the?2013?Income?Statement.?Create?a?chart?in?Excel?using?the?sample?format?below?to?summarize?the?revenue?in?dollars?and?percent?of?growth?year?over?
            2. year?for?the?past?three?years?(from?2010?2012),?and?then?answer?the?questions?that?follow.???Please?use?the?following??2013?Annual?JcPenny?Report?to?get?the?answer:??https://snhu-media.snhu.edu/files/course_repository/graduate/ol/ol501/ol501_jcpenney_annual_report.pdf???
            3. ??if?the?link?doesn't?work?please?type?it?in?your?URL.

2012	$ Rev	% Chg		2011	$ Rev	% Chg		2010	$ Rev	% Chg

Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K
(Mark One)

x

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended February 2, 2013
or

o

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the transition period from ______________ to ________________
Commission File Number: 001-15274

J. C. PENNEY COMPANY, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)

26-0037077
(I.R.S. Employer Identification No.)

6501 Legacy Drive, Plano, Texas 75024-3698
(Address of principal executive offices)
(Zip Code)
(972)-431-1000
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Name of each exchange on which registered
New York Stock Exchange

Common Stock of 50 cents par value

Securities registered pursuant to Section 12(g) of the Act:
None

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes o No x
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months ( or for such shorter period that the registrant was required to file such reports ), and (2) has been subject to such filing
requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to
be submitted and posted pursuant to Rule 405 of Regulation S ???T (? 232.405 of this chapter) during the preceding 12 months (or for such shorter period
that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (? 229.405 of this chapter) is not contained herein, and will
not be contained, to the best of registrant?s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10 ???K
or any amendment to this Form 10 ???K. x
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the
definitions of ?large accelerated filer,? ?accelerated filer? and ?smaller reporting company? in Rule 12b-2 of the Exchange Act.
Large accelerated filer x

Accelerated filer o

Non-accelerated filer o

Smaller reporting company
(Do not check if a smaller reporting company)

o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No

x

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common
equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant?s most recently completed

second fiscal quarter (July 28, 2012). $3,570,280,064
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.
219,754,016 shares of Common Stock of 50 cents par value, as of March 1 8 , 2013.
DOCUMENTS INCORPORATED BY REFERENCE
Documents from which portions are incorporated by reference
Parts of the Form 10-K into which incorporated

J. C. Penney Company, Inc. 2013 Proxy Statement

Part III

Table of Contents

INDEX
Page
Part I
Item
Item
Item
Item
Item
Item

1. Business
1A. Risk Factors
1B. Unresolved Staff Comments
2. Properties

14
14

3. Legal Proceedings
4. Mine Safety Disclosures

16
16

3

5

Part II
Item 5. Market for Registrant?
s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Item 6. Selected Financial Data
Item 7. Management?s Discussion and Analysis of Financial Condition and Results of Operations
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Item 8. Financial Statements and Supplementary Data
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Item 9A. Controls and Procedures
Item 9B. Other Information

17
19
22
41
41
41
41
44

Part III
Item
Item
Item
Item
Item

10. Directors, Executive Officers and Corporate Governance
11. Executive Compensation
12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
13. Certain Relationships and Related Transactions, and Director Independence
14. Principal Accounting Fees and Services

44
44
44

45
45

Part IV
Item 15. Exhibits, Financial Statement Schedules

46

Signatures
Index to Consolidated Financial Statements
Exhibit Index

49
88

47

2

Table of Contents

PART I
Item 1. Business

Business Overview
J. C. Penney Company, Inc. is a holding company whose principal operating subsidiary is J. C. Penney Corporation, Inc. (JCP). JCP was
incorporated in Delaware in 1924, and J. C. Penney Company, Inc. was incorporated in Delaware in 2002, when the holding company
structure was implemented. The new holding company assumed the name J. C. Penney Company, Inc. (Company). The holding company
has no independent assets or operations, and no direct subsidiaries other than JCP. Common stock of the Company is publicly traded
under the symbol ?JCP? on the New York Stock Exchange. The Company is a co-obligor (or guarantor, as appropriate) regarding the
payment of principal and interest on JCP?s outstanding debt securities. The guarantee by the Company of certain of JCP?s outstanding debt
securities is full and unconditional. The holding company and its consolidated subsidiaries, including JCP, are collectively referred to in
this Annual Report on Form 10-K as ?we,? ?us,? ?our,? ?ourselves,? ?Company? or ?jcpenney.?
Since our founding by James Cash Penney in 1902, we have grown to be a major retailer, operating 1,104 department stores in 49 states
and Puerto Rico as of February 2, 2013. Our fiscal year ends on the Saturday closest to January 31. Unless otherwise stated, references to
years in this report relate to fiscal years, rather than to calendar years. Fiscal year 2012 ended on February 2, 2013; fiscal year 2011 ended
on January 28, 2012; and fiscal year 2010 ended on January 29, 2011. Fiscal year 2012 consisted of 53 weeks and fiscal years 2011 and
2010 consisted of 52 weeks.
Our business consists of selling merchandise and services to consumers through our department stores and through our Internet website at
jcp.com. Department stores and Internet generally serve the same type of customers and provide virtually the same mix of merchandise, and
department stores accept returns from sales made in stores and via the Internet. We sell family apparel and footwear, accessories, fine and
fashion jewelry, beauty products through Sephora inside jcpenney and home furnishings. In addition, our department stores provide our
customers with services such as styling salon, optical, portrait photography and custom decorating.

Our merchandise mix of total net sales over the last three years was as follows:
2012
Women?s apparel
Men?s apparel and accessories
Home

Women?s accessories, including Sephora
Children?s apparel
Family footwear
Fine jewelry
Services and other

2011

2010

23%
21%
12%
13%
12%
7%
7%

25%

5%

5%

100%

100%

20%

15%
12%
12%
7%
4%

24%
20%
18%
12%

11%
7%
4%
4%
100%

Business Strategy
At the beginning of 2012, we announced our plans to become America?s favorite store by creating a specialty department store experience.
During our first year of transformation, we focused on building a new foundation for the future by reimagining all aspects of our business,
including product, presentation, pricing and promotion.

We are making substantial changes in our merchandise and continue to edit and introduce more global brands into our merchandise
assortment. We are re-organizing our department stores into separately curated unique specialty stores known as The Shops. The Shops

will be organized around a pathway through our stores known as The StreetTM, a bold new interface for retail, which includes places to
relax, refresh, engage and check out. The Street will surround The SquareTM, a dynamic seasonal space that will provide engaging
experiences for our customers. Our pricing strategy is founded on providing merchandise at low everyday prices and delivering even more
exciting value through sales, promotions and rewards.

During the first year of transformation we opened shops under the Levi's ?, Izod?, Liz Claiborne?, The Original Arizona Jean Co.?, and
jcp? brands. We also opened 78 Sephora inside jcpenney stores, bringing the total to 386.

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Table of Contents

Competition and Seasonality
The business of marketing merchandise and services is highly competitive. We are one of the largest department store and e-commerce
retailers in the United States, and we have numerous competitors, as further described in Item 1A, Risk Factors. Many factors enter into
the competition for the consumer?s patronage, including price, quality, style, service, product mix, convenience and credit availability. Our
annual earnings depend to a great extent on the results of operations for the last quarter of the fiscal year, which includes the
holiday season, when a significant portion of our sales and profits are recorded.

Trademarks
The jcpenney ?, Fair and Square TM, jcp?, monet?, Liz Claiborne ?, Okie Dokie ?, Worthington?, a.n.a?, St. John?s Bay?, The
Original Arizona Jean Company ?, Ambrielle ?, Decree?, Linden Street?, Stafford ?, J. Ferrar ?, jcpenney Home Collection ? and Studio
by jcpenney Home Collection ? trademarks, as well as certain other trademarks, have been registered, or are the subject of pending
trademark applications with the United States Patent and Trademark Office and with the registries of many foreign countries and/or are
protected by common law. We consider our marks and the accompanying name recognition to be valuable to our business.

Website Availability
We maintain an Internet website at www.jcp.com and make available free of charge through this website our annual reports on Form 10-K,

quarterly reports on Form 10-Q, current reports on Form 8-K and all related amendments to those reports, as soon as reasonably
practicable after the materials are electronically filed with or furnished to the Securities and Exchange Commission. In addition, our website
provides press releases, access to webcasts of management presentations and other materials useful in evaluating our Company.

Suppliers
We have a diversified supplier base, both domestic and foreign, and are not dependent to any significant degree on any single supplier. We purchase our merchandise
over 2,5 00 domestic and foreign suppliers, many of which have done business with us for many years. In addition to our Plano, Texas

home office, we, through our international purchasing subsidiary, maintained buying and quality assurance offices in
12 foreign countries as of February 2, 2013.

Employment
The Company and its consolidated subsidiaries employed approximately 116,000 full-time and part-time
employee s as of February 2, 2013.
Environmental Matters
Environmental protection requirements did not have a material effect upon our operations during 2012. It is possible that compliance with
such requirements (including any new requirements) would lengthen lead time in expansion or renovation plans and increase construction
costs, and therefore operating costs, due in part to the expense and time required to conduct environmental and ecological studies and any
required remediation.
As of February 2, 2013, we estimated our total potential environmental liabilities to range from $30 million to $36 million and recorded our
best estimate of $30 million in other liabilities in the Consolidated Balance Sheet as of that date. This estimate covered potential liabilities
primarily related to underground storage tanks, remediation of environmental conditions involving our former drugstore locations and
asbestos removal in connection with approved plans to renovate or dispose of our facilities. We continue to assess required remediation and
the adequacy of environmental reserves as new information becomes available and known conditions are further delineated. If we were to
incur losses at the upper end of the estimated range, we do not believe that such losses would have a material effect on our financial
condition, results of operations or liquidity.
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Table of Contents
Executive Officers of the Registrant

The following is a list, as of March 5, 2013, of the names and ages of the executive officers of J. C. Penney Company, Inc. and of the
offices and other positions held by each such person with the Company. These officers hold identical positions with JCP. There is no
family relationship between any of the named persons.

Name
Ronald B. Johnson
Michael W. Kramer
Daniel E. Walker
Kenneth H. Hannah
Janet Dhillon
Mark R. Sweeney

Offices and Other Positions Held With the Company
Chief Executive Officer
Chief Operating Officer
Chief Talent Officer
Executive Vice President and Chief Financial Officer
Executive Vice President, General Counsel and Secretary
Senior Vice President and Controller

Age

54
48

62
44

50
51

Mr. Johnson has served as Chief Executive Officer of the Company since November 2011. He previously served as Senior Vice President,
Retail of Apple, Inc. Prior to joining Apple in 2000, he held a variety of positions with Target Corporation, including Senior Vice President
of Merchandising. During his tenure at Target, Mr. Johnson had responsibility for such categories as Men?s Apparel, Women?s Apparel and
Accessories, Children?s and Home. He has served as a director of the Company and as a director of JCP since 2011.

Mr. Kramer has served as Chief Operating Officer of the Company since December 2011. Prior to joining the Company, he was President
and Chief Executive Officer of Kellwood Company. From 2005 to 2008, Mr. Kramer was Executive Vice President and Chief Financial
Officer at Abercrombie & Fitch. From 2000 to 2005, he was at Apple, Inc., where he served as Chief Financial Officer of Apple retail. Mr.
Kramer previously held key financial leadership roles with The Limited, Pizza Hut and Einstein Noah Bagel Corporation.

Mr. Walker has served as Chief Talent Officer of the Company since November 2011. He served as Chief Talent Officer for Apple, Inc.
from 2000 to 2004 and as Vice President of Human Resources at Gap from 1986 to 1992. Mr. Walker founded and led The Human
Revolution Studios prior to joining the Company, and Daniel Walker and Associates, an executive search and consulting firm, prior to
joining Apple. Prior to joining Gap, he was Director of Human Resources for the Specialty Retail Group at General Mills and worked for
Lazarus Department Stores, a division of Federated Department Stores.
Mr. Hannah has served as Executive Vice President and Chief Financial Officer since May 2012. Prior to joining the Company, he was
Executive Vice President and President-Solar Energy of MEMC Electronic Materials, Inc. and had previously served as Executive Vice
President and President-Solar Materials from 2009 to 2012 and Senior Vice President and Chief Financial Officer from 2006 to 2009. Mr.
Hannah previously held key financial leadership positions at The Home Depot, Inc., The Boeing Company and General Electric
Company. He has served as a director of JCP since 2012.
Ms. Dhillon has served as Executive Vice President, General Counsel and Secretary of the Company since 2009. Prior to joining the
Company, she served as Senior Vice President and General Counsel and Chief Compliance Officer of US Airways Group, Inc. and US
Airways, Inc. from 2006 to 2009. Ms. Dhillon joined US Airways, Inc. in 2004 as Managing Director and Associate General Counsel and
served as Vice President and Deputy General Counsel of US Airways Group, Inc. and US Airways, Inc. from 2005 to 2006. Ms. Dhillon
was with the law firm of Skadden, Arps, Slate, Meagher & Flom LLP from 1991 to 2004. She has served as a director of JCP since 2009.
Mr. Sweeney has served as Senior Vice President and Controller since September 2012. Prior to joining the Company, he was Vice President
and Operational Controller of General Electric Company from 2008 to 2012. He previously served as Chief Financial Officer of GE-Hitachi
Nuclear Energy, LLC from 2004 to 2008 and Global Controller of General Electric?s Energy Division from 1997 to 2004. Prior to joining
General Electric, Mr. Sweeney held financial leadership positions with PepsiCo, Inc. from 1995 to 1997 and previously was a senior
manager with KPMG LLP.

Item 1A. Risk Factors
The following risk factors should be read carefully in connection with evaluating our business and the forward-looking information
contained in this Annual Report on Form 10-K. Any of the following risks could materially adversely affect our business, operating
results, financial condition and the actual outcome of matters as to which forward-looking statements are made in this Annual Report on
Form 10-K.

5

Table of Contents

The success of our transformation is subject to both the risks affecting our business generally and the inherent difficulties
associated with implementing our new strategies.
Our ability to improve our operating results depends upon a significant number of factors, some of which are beyond our control,
including:

?
?
?
?
?
?
?
?
?
?
?
?
?

customer acceptance of our marketing and merchandise strategies;
our ability to respond to any increased competitive pressures in our industry;
the extent to which our management team has properly understood the dynamics and demands of our market in crafting the
transformation;
our ability to achieve profitable sales and to make adjustments in response to changing conditions;
our ability to effectively manage inventory;
the success of our strategic initiatives and cost reduction initiatives;
the time to complete, and cost increases associated with, the Company?s capital improvements;
our ability to respond to any unanticipated changes in expected cash flows, liquidity, cash needs and cash expenditures,
including our ability to obtain any additional financing or other liquidity enhancing transactions, if and when needed;
our ability to achieve positive cash flow, particularly during our peak inventory build-ups in advance of principal selling
seasons;
our employees? ability to adapt to our new strategic initiatives and organizational structure;
our management team?s ability to execute our new strategic initiatives in a cost-effective manner;
our ability to access adequate and uninterrupted supply of merchandise from suppliers at expected levels and on acceptable terms;
and
general economic conditions.

There is no assurance that we will be able to successfully implement our strategic initiatives, which could have an adverse impact on our
results of operations.

Our strategies to transform our business may not achieve the improvements we expect in our operating results.
We are executing a number of strategic initiatives as part of our transformation, including changes in our pricing strategy, corporate
branding, marketing, store layout and merchandise assortments. During this transition period, changes to our pricing and marketing
strategies have resulted in a prolonged decline in sales and our results of operations have been significantly below our expectations. It may
take longer than expected or planned to recover from our negative sales trends and operating results, and actual results may be materially
less than planned. As certain of these strategic initiatives such as the Shops and the Street are focused on our largest stores, they may not
have the same impact on all of our stores. We may need to adjust any one or more of these strategic initiatives depending upon our
customers? reactions to and acceptance of these initiatives. Any changes to our strategies could be substantial, and if implemented, could
result in significant additional costs. Adjustments may also create confusion among our customers, divert management and employees?
attention from other business concerns or otherwise disrupt our business. There is no assurance that our pricing, branding, store layout,
marketing and merchandising strategies, or any future adjustments to our strategies, will improve our operating results.

We operate in a highly competitive industry that includes significant promotional activity, which could adversely impact our sales
and profitability.
The retail industry is highly competitive, with few barriers to entry. We compete with many other local, regional and national retailers for
customers, employees, locations, merchandise, services and other important aspects of our business. Those competitors include other
department stores, discounters, home furnishing stores, specialty retailers, wholesale clubs, direct-to-consumer businesses, including the
Internet, and other forms of retail commerce. Some competitors are larger than jcpenney, and/or have greater financial resources available to
them, and, as a result, may be able to devote greater resources to sourcing, promoting and selling their products. Competition is
characterized by many factors, including merchandise assortment, advertising, price, quality, service, location, reputation and credit
availability. During the first year of our transformation, we discontinued our former promotional strategy and encountered difficulties in
communicating our value proposition. Although we have re-introduced certain promotional activities, there can be no assurance that
increased promotional activity will result in increased sales and profitability. We have experienced, and anticipate that we will continue to
experience for at least the foreseeable future, significant competition from promotional activities of our competitors. The performance of
competitors as well as changes in their pricing and promotional policies, marketing activities, new store openings, launches of Internet
websites, brand launches and other merchandise and operational strategies could cause us to have lower sales, lower gross margin and/or
higher operating expenses such as marketing costs and other selling, general and administrative expenses, which in turn could have an
adverse impact on our profitability.

6

Table of Contents

Our sales and operating results depend on our ability to develop merchandise offerings that resonate with our existing
customers and help to attract new customers.
Our sales and operating results depend in part on our ability to predict and respond to changes in fashion trends and customer preferences
in a timely manner by consistently offering stylish, quality merchandise assortments at competitive prices. We continuously assess
emerging styles and trends and focus on developing a merchandise assortment to meet customer preferences. Even with these efforts, we
cannot be certain that we will be able to successfully meet constantly changing customer demands. One of our strategic initiatives is to
transform our largest stores into a collection of Shops showcasing major apparel and brands. Our goal is for our transformed merchandise
and brand image to expand our customer base while continuing to appeal to our traditional, core customer. To the extent our predictions
regarding our merchandise or the vendors selected for our Shops differ from our customers? preferences, we may be faced with reduced
sales and excess inventories for some products and/or missed opportunities for others. Any sustained failure to identify and respond to
emerging trends in lifestyle and customer preferences and buying trends could have an adverse impact on our business. In addition,
merchandise misjudgments may adversely impact the perception or reputation of our Company, which could result in declines in customer
loyalty and vendor relationship issues, and ultimately have a material adverse effect on our business, financial condition and results of
operations.

Our ability to increase sales and store productivity is largely dependent upon our ability to increase customer traffic.
Customer traffic depends upon our ability to successfully market compelling merchandise assortments as well as present an appealing
shopping environment and experience to existing customers and new customers. In the first year of our transformation, our store customer
traffic significantly decreased compared to the prior year. As part of the re-imagination of our stores, we are changing our merchandise
as...