J. C. Penney Company Inc

J. C. Penney — Investor Presentation (May 2020)

69 slides from J. C. Penney's investor presentation, May 18, 2020

  1. Slide 1: JCPenney Business Plan May 2020

    Exhibit 99.2 JCPenney Business Plan May 2020 Confidential – Subject to Non‐Disclosure AgreementExhibit 99.2 JCPenney Business Plan May 2020 Confidential – Subject to Non‐Disclosure Agreement

  2. Slide 2: Disclaimer

    Disclaimer This presentation and all information contained therein (this “Presentation”) has been prepared at the direction of J. C. Penney Company, Inc. (“J. C. Penney” or the “Company”) and is being delivered for informational purposes only on behalf of the Company to a limited number of parties b

  3. Slide 3: Topics for today's presentation

    Topics for today’s presentation What we’ll cover What we hope you take away Current state and recent transformation We understand the root causes of our historical momentum performance decline, implemented actions to address those issues and are seeing early traction The COVID‐19 disruption and our

  4. Slide 4: Current state and recent transformation

    Current state and recent transformation momentum 4 Confidential – Subject to Non‐Disclosure Agreement |Current state and recent transformation momentum 4 Confidential – Subject to Non‐Disclosure Agreement |

  5. Slide 5: JCPenney has 100+ years of heritage and meaningful strengths

    JCPenney has 100+ years of heritage serving American families and meaningful strengths to build upon in this transformation journey Brand strength Loyal Customer base Omnichannel assets People & culture • ~85K associates, 80% women • Omnichannel capabilities • 200M+ transactions from • Recognized an

  6. Slide 6: Financial performance was challenged leading up to the CEO transition

    However, our financial performance was challenged leading up to the most recent CEO transition and launch of our transformation 1 Net Sales CAGR as of Sep 2018 Total return to shareholders (TRS) index through Sep 2018, Percent January 2012 = 100, USD Five year Two year One year CEO transition JCP S&

  7. Slide 7: Root cause issues that drove performance decline

    As we set out to turn this trajectory, we first identified the root cause issues that had driven performance decline Customer, margin & channel issues Category issues Ÿ Confusing and ineffective pricing and promotions Ÿ Shift of unit volume from traffic driving and compressed gross margin, while con

  8. Slide 8: Methodically fixing problems and creating transformational change

    We are methodically fixing our problems, making foundational improvements and creating transformational change for our customer focus segment Fixed our problems and Deep dive on our customer and their took immediate actions needs/wants/attitudes Ÿ Reduced and enhanced inventory position Ÿ Identified

  9. Slide 9: Strategic choices outlined in our Plan For Renewal

    We have clearly defined our strategic choices, and these choices are outlined in our Plan For Renewal Offer Compelling Merchandise Drive Traffic Deliver Engaging Experience PLAN FOR RENEWAL Fuel Growth Build a Results‐Minded Culture 9 9 Confidential Confidential – – Subj Subject ect to to Non‐Disclo

  10. Slide 10: Efforts led to meaningful change in trajectory in FY19 and early FY20

    These efforts led to meaningful change in trajectory in FY19 and early FY20 Category Met guidance on Channel / Margin progress Metrics through FY19 progress Fixed our problems and took immediate actions 10 Confidential – Subject to Non‐Disclosure Agreement |These efforts led to meaningful change in

  11. Slide 11: Financial performance meaningfully improved in FY19

    Financial performance was meaningfully improved in FY19 based on early traction from our Plan for Renewal Met or exceeded guidance on metrics through FY19 Net sales momentum Gross margin improvement Sales met guidance, with q4 positive comps in several categories Gross margin rate up ~210 bps by opt

  12. Slide 12: Significant improvements to channel and margin root cause issues

    In FY19, we have made significant improvements to identified channel and margin root cause issues Channel /Margin progress Enhanced customer Developed new Improved overall Brand strength Loyal Customer base Omnichannel assets People & culture experience fulfillment models digital experience • Launch

  13. Slide 13: Redefined merchandise strategy and discipline

    We have redefined our merchandise strategy and discipline, improving our offering to the customer and building momentum Category progress Built comp sales Improved curation Enhanced assortment Brand strength Loyal Customer base Omnichannel assets People & culture momentum • Relaunched private brand

  14. Slide 14: The COVID-19 disruption and our expected recovery

    The COVID‐19 disruption and our expected recovery 14 Confidential – Subject to Non‐Disclosure Agreement |The COVID‐19 disruption and our expected recovery 14 Confidential – Subject to Non‐Disclosure Agreement |

  15. Slide 15: COVID-19 has created unprecedented disruptions within apparel

    COVID‐19 has created unprecedented disruptions within the apparel space, but could allow JCPenney to accelerate within a “new normal” Offline O nline Illustrative apparel retail impact and phasing | COVID‐19 Spread Mid‐ to long‐term recovery of consumer E volution towards the sentiment & supply “new

  16. Slide 16: Short-term sales impacted; eComm returns to trajectory, stores stabilize

    While short‐term sales will be impacted, we project eComm channel to return to FY19 trajectory in Q2 FY21 and stores to stabilize by holiday FY21 Annual stores net sales, $B, including Services & “Other” Annual eComm net sales, $B 9,172 6,745 6,681 6,632 6,666 3,763 1,544 2,331 2,119 1,926 1,607 1,3

  17. Slide 17: Streamline footprint by ~30%

    We will streamline our footprint by ~30%, transitioning to a stronger and more sustainable fleet Store network optimized... …creating positive footprint shifts FY19 stores net sales, $B, 1 Store count including Services & “Other” A/B malls On mall Per‐store revenue, FY19 Current 846 $9.2B 58% 72% $1

  18. Slide 18: Doubling down in eComm

    In light of channel shifts, we are doubling down in eComm to create a curated shopping experience with digital flagship driving ~$2.3B in sales by FY24 eComm will be a bigger driver of enterprise sales Where JCPenney is well positioned to grow FY19 FY24 Marketing Fulfillment $1.5B $2.3B eComm effici

  19. Slide 19: Our Plan for Renewal

    Our Plan for Renewal 19 Confidential – Subject to Non‐Disclosure Agreement |Our Plan for Renewal 19 Confidential – Subject to Non‐Disclosure Agreement |

  20. Slide 20: Plan for Renewal framework

    Offer Compelling Merchandise Drive Traffic Deliver Engaging Experience PLAN FOR RENEWAL Fuel Growth Build a Results‐Minded Culture 20 20 Confidential Confidential – – Subj Subject ect to to Non‐Disclosur Non‐Disclosure e Agr Agreement eement | |Offer Compelling Merchandise Drive Traffic Deliver Enga

  21. Slide 21: Compelling merchandise strategy

    Our compelling merchandise strategy is the framework for how we bring product to life online and in our stores Ÿ Market share – supports our choices and focus; we defined our category roles based on customer importance and market‐share relevance Compelling Category Ÿ Assortment architecture and choi

  22. Slide 22: Drive traffic by knowing our customer

    We drive traffic by knowing our customer and engaging them across channels Ÿ Build value proposition around customer focus segment (All‐in Shopping Enthusiast), creating a place fun to shop, making it easier to put outfits Know our Drive traffic together, supporting them in celebrating life’s events

  23. Slide 23: Engaging experience on digital flagship and in stores

    We meet our customers where they are with an engaging experience on our digital flagship and in our stores Ÿ Digital is becoming a core part of all customer experiences, as nearly 90% of customers start their path to purchase online, even those that ultimately Deliver engaging Digital lead to our st

  24. Slide 24: Go-forward business smaller but stronger and more profitable

    The go‐forward business will be a smaller but stronger, more effective, and more profitable enterprise Ÿ The approximately 604 future fleet represent the highest sales‐generating, most profitable, and most productive stores in the network Fuel growth Leaner more Ÿ These stores make up 82% of FY19 ne

  25. Slide 25: Committed to Plan for Renewal as customer behavior shifts

    We are committed to our Plan for Renewal and acknowledge the current landscape requires agility as customer behavior shifts We recognize the world has changed And we’re responding accordingly Customers seek contactless experiences (56% • Accelerate enhancements to eCommerce user experiences currentl

  26. Slide 26: Historic and Projected Financial Overview

    Historic and Projected Financial Overview 26 Confidential – Subject to Non‐Disclosure Agreement |Historic and Projected Financial Overview 26 Confidential – Subject to Non‐Disclosure Agreement |

  27. Slide 27: Financial summary

    Financial summary Our planned reemergence from the COVID‐19 crisis is built upon the components of our Plan for Renewal, plus a more rationalized store portfolio and an accelerated reduction in our enterprise cost structure, that will deliver over $2.8B in adjusted EBITDA (A) from FY21 through FY24

  28. Slide 28: Income Statement

    Income Statement 1 Adjusted EBITDA to exceed $900M and reach 10% of net sales in FY24 as we return the business to topline growth and expand operating margin ($ in millions) FY19 FY20 FY21 vs LLY FY22 FY23 FY24 Store Sales $8,518 $3,440 $6,168 $6,123 $6,154 $6,231 Store Comp% (6.0%) (58.8%) 81.1% (1

  29. Slide 29: Enterprise sales – comparable sales turn positive

    Enterprise sales ‐ Comparable sales turn positive as we close unproductive stores and eComm growth offsets negative store sales $ millions Total Increase Decrease 10,716 ‐1,615 242 Closing ‐70 Stores +798 9,076 ‐753 3 5 Discontinued FY19 Sales Closed Stores Stores & Services eComm FY24 Sales 4 Merch

  30. Slide 30: Store sales – traffic declines moderate

    1 Store sales ‐ Traffic declines are planned to moderate as growth initiatives help stores rebound from COVID‐19 impact Disc. Merch. $ millions 4 Non Go Forward Go Forward 9,172 Decrease 59 ‐59 ‐1,173 Increase 1,615 ‐442 192 ‐399 6,745 50 Closing Closing ‐636 79 34 169 5 5 Stores Stores 7,499 FY19 S

  31. Slide 31: Rationalizing the store portfolio

    1 Rationalizing the store portfolio ‐ Go‐forward portfolio of stores represent a more financially productive fleet across all key financial measures Detail follows Store performance by tranche, FY19 Sales share, Avg sales per Sales per Avg four‐wall 3 1 # of stores Sales , $M % store, $M SF , $ prof

  32. Slide 32: Leased store exits overview

    1A Leased store exits overview Store count by years remaining on lease 1 Leased stores identified for closure (total = 192 ) 39 Ÿ Closures for close‐in 34 34 leases were previously 29 planned for phasing as leases expired, or in extreme cases in spite of lease break penalties 18 Ÿ Current context cr

  33. Slide 33: Owned store exits overview

    1B Owned store exits overview Encumbered vs. unencumbered Financials Malls Encumbered # of stores Average FY19 sales per store, $ M Mall grades Encumbered AB C D Unencumbered Encumbered Leased exits 6.3 Owned Owned 22% 28% 46% 4% 32% 68% exits exits Owned exits 9.1 Go‐forward Go‐ 20% 32% 46% 2% 61%

  34. Slide 34: Scenarios to assess the go-forward network

    1 To assess the go‐forward network, we evaluated a range of forward‐looking scenarios for the industry, JCPenney, and individual store performance through COVID‐19 and recovery Ÿ Leveraged macroeconomic COVID‐19 scenarios for US (epidemiological and store opening approach) applied to Apparel retail

  35. Slide 35: Go-forward network of high performing stores

    1 Go‐forward network built around a high performing and resilient set of stores based on both store financials and strategic considerations Closures based on Strategic add‐backs to Tentative go‐forward Current store portfolio pro‐forma four‐wall Subtotal Strategic closures network network performanc

  36. Slide 36: Store financial assessment filters

    1 The store financial assessment identifies closures based on three primary filters, yielding 583 stores as a base for the preliminary go‐forward network To be closed To retain as preliminary go-forward Store count by closure status and metric, Store count 1 Assessment Filters Operating margin dolla

  37. Slide 37: eComm sales rebound from store closure halo

    2 eComm sales will rebound from the negative halo of store closures and reach double digit growth rates as improvements to site, fulfillment, and merchandise assortment takes hold Total Increase $ millions Decrease +897 ‐11 ‐99 2,331 1,544 FY19 eComm Sales eComm Performance Discontinued Impact from

  38. Slide 38: eComm historical growth and return to momentum

    2 eComm business has experienced historical growth and is poised to return to strong momentum 1 eComm net sales , $ billions eComm experienced Conscious decision in significant growth from Topline is poised to regain growth as eComm FY19 to reset to FY14‐FY18 due to expansion penetration and growth

  39. Slide 39: eComm growth achievable compared to peers

    2 JCPenney eComm growth reflects acceleration relative to historical performance, and is achievable when compared to peers eComm penetration eComm net sales growth FY19 % of enterprise sales FY16 – FY19 CAGR JCPenney eComm penetration 23% 17% • FY19: 14% • FY24: 26% ‐ achievable given this is in‐lin

  40. Slide 40: Gross margin rate increases 60bps

    3 Gross Margin ‐ Rate increases 60bps with pricing and promotion initiatives that are partially offset by higher eComm penetration and fulfillment costs % of net sales Total Decrease Increase +0.3% ‐1.6% +0.3% +1.9% ‐0.3% 35.2% 34.6% FY19 Pricing & Discontinued Shrinkage Channel Mix Distribution FY2

  41. Slide 41: Pricing and promotion driving margin gains

    3 Pricing and promotion is already driving margin gains and will continue as we further optimize price strategy and markdowns Gross profit by channel BPS Improvement, FY18 to FY19 % of net sales • We have realized FY18 FY19 FY24 tremendous potential from markdown 42.0 opportunities and spend 38.4 37

  42. Slide 42: Clearance management contributing to margin improvement

    3 Clearance management has contributed to margin improvement as clearance mix and selling margin have improved Clearance volume as % of total FY18 & FY19, % of net sales Selling margin, % of net sales FY18 FY19 Clearance 17.8% ‐ 74 bps 17.1% ‐14.4% 0.4% 48.1% 48.9% Non‐clearance 82.9% 82.2% • Cleara

  43. Slide 43: SG&A – $1B reduction

    4 SG&A ‐ Closing stores and continuous improvement initiatives will drive $1B reduction in SG&A $ millions Total 3,585 ‐467 Decrease 33.5% 242 Closing 1 Stores ‐98 ‐95 ‐115 28.3% ‐56 ‐111 ‐78 2,566 FY19 Closed Stores Stores Expenses Gross Advertising Gross Advertising Bonus/Equity Administrative Oth

  44. Slide 44: Cost reductions drive EBITDA improvement

    4 Cost reductions across major line items drive EBITDA (A) improvement of ~500 bps by FY24 $M % net sales FY23 FY19 FY20 FY21 FY22 FY23 FY24 FY19 FY20 FY21 FY22 FY24 Total net sales 10,716 5,085 8,288 8,558 8,784 9,076 ‐‐‐ ‐ ‐ ‐ Enterprise GP 3,691 1,434 2,779 3,097 3,158 3,249 36.7% 30.1% 35.7% 38.

  45. Slide 45: EBITDA rate improvement driven by three line items

    4 EBITDA (A) rate improvement is driven by three key line items Stores payroll down ~150 bps to 8.5% of total net sales in FY24 as lower A productivity stores closed and go‐forward store labor reduced Advertising down 120 bps to 4.4% of net sales by FY22 and leveraged further to B 4.3% by FY24, with

  46. Slide 46: Adjusted EBITDA

    Adjusted EBITDA Adjusted EBITDA to exceed $900M and reach 10% of net sales in FY24 as we return the business to topline growth and expand operating margin ($ in millions) FY19 FY20 FY21 FY22 FY23 FY24 LY EBITDA (A) $583 ($638) $279 $806 $861 Credit Income ($257) $64 $36 $3 $4 Gross Margin (Volume) (

  47. Slide 47: Unlevered Free Cash Flow

    Unlevered Free Cash Flow ($ in Millions) FY19 FY20 FY21 FY22 FY23 FY24 EBTIDA (A) $583 ($638) $279 $806 $861 $935 % of Net Sales 5.4% (12.5%) 3.4% 9.4% 9.8% 10.3% (+/‐) Chang e in Inventory 271 445 ‐49 ‐41 55 ‐1 (+/‐) Chang e in Payables ‐61 ‐156 17 14 ‐19 1 (+/‐) Chang e in Other NWC ‐25 ‐20 ‐20 ‐5

  48. Slide 48: Letters of Credit as of April 4, 2020

    Letters of Credit as of April 4, 2020 Purpose Expiry Date Amount ($mm) Workers Comp June 12 $38.3 Workers Comp February 1 $47.9 Workers Comp May 13 $23.0 Merchandise October 31 $20.0 Merchandise January 15, 2021 $10.0 Merchandise January 15, 2021 $7.5 Merchandise January 15, 2021 $7.5 Workers Comp M

  49. Slide 49: Cash Flow Forecast

    JCPenney Co., Inc. Cash Flow Forecast US$ Millions 2020-Q1 FEB FEB FEB FEB FEB MAR MAR MAR MAR 8-Feb 15-Feb 22-Feb 29-Feb 7-Mar 14-Mar 21-Mar 28-Mar 4-Apr 1 2345 6789 (1) SALES 132 163 150 147 168 134 50 19 19 TOTAL COLLECTIONS 134 163 169 162 172 176 95 33 42 DISBURSEMENTS Total Operating Disbursem

  50. Slide 50: Weekly Cash Flow

    J.C. Penney Company, Inc. Weekly Cash Flow As of May 15, 2020 (US $ MMs) Actual / Forecast F F F F F F F F F F F F F F F F F F F F Fiscal Month May May May Jun Jun Jun Jun Jul Jul Jul Jul Aug Aug Aug Aug Aug Sep Sep Sep Sep Year FY20 FY20 FY20 FY20 FY20 FY20 FY20 FY20 FY20 FY20 FY20 FY20 FY20 FY20 F

  51. Slide 51: Monthly forecast (October 2020 – January 2021)

    As of May 13, 2020* Monthly forecast (October 2020 – January 2021) J.C. Penney Company, Inc. 4 5 4 4 Monthly Cash Flow Oct Nov Dec Jan (US $ MMs) FY20 FY20 FY20 FY20 31-Oct 5-Dec 2-Jan 30-Jan Sales $429 $1,034 $882 $338 Collections & Disbursements Total Collections $467 $1,063 $998 $420 Total Operat

  52. Slide 52: Weekly Cash Flow

    HIGHLY CONFIDENTIAL J.C. Penney Company, Inc. Weekly Cash Flow (US $ MMs) Fiscal Month Apr Apr Apr Apr Fiscal Week 10 11 12 13 Year FY20 FY20 FY20 FY20 Week Ending 11-Apr 18-Apr 25-Apr 2-May Net Sales $ 23 $ 33 $ 36 $ 26 Collections & Disbursements Total Collections 24 31 31 27 Total Operating Disbu

  53. Slide 53: Borrowing Base Roll Forward

    HIGHLY CONFIDENTIAL J.C. Penney Company, Inc. Borrowing Base Roll Forward (US $ MMs) Fiscal Month Apr Apr Fiscal Week 10 13 Year FY20 FY20 Week Ending 11-Apr 2-May Borrowing Base Credit Card Receivables $ 4 $ 15 Eligible External Inventory 2,061 2,052 Total Reserves (153) (153) # Confidential 1 of 1

  54. Slide 54: Total Payroll & Benefits

    JCPenney Co., Inc. US$ Millions 2020-Q1 8-Feb 15-Feb 22-Feb 29-Feb 7-Mar 14-Mar 21-Mar 28-Mar 4-Apr Total Payroll & Benefits (32) (58) (33) (45) (35) (38) (107) (40) (31)JCPenney Co., Inc. US$ Millions 2020-Q1 8-Feb 15-Feb 22-Feb 29-Feb 7-Mar 14-Mar 21-Mar 28-Mar 4-Apr Total Payroll & Benefits (32)

  55. Slide 55: Pro-Forma Borrowing Base

    JCPenney Co. Inc. PRO-FORMA BORROWING BASE ($ in millions) FY 2020 Feb Available Inventory $1,850 Available Cc Receivables 35 Total Reserves (158) Borrowing Base 1,727 Revolving Commitment 2,350 Lower of Borrowing Base or Revolving Commitment 1,727 Minimum excess availability - Bank Borrowings 0 Let

  56. Slide 56: FY 2018 Sales by Store

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD FY 2018 Sales by Store # of stores >=30mm $225 5 29-30mm $59 2 28-29mm $57 2 27-28mm $111 4 26-27mm $159 6 25-26mm $230 9 24-25mm $97 4 23-24mm $141 6 22-23mm $247 11 21-22mm $257 12 20-21mm $448 22 19-20mm $507 26

  57. Slide 57: FY 2019 Sales by Store

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD FY 2019 Sales by Store # of stores >=30mm 5 $202 0 29-30mm $0 28-29mm 0 $0 2 27-28mm $55 26-27mm $79 3 25-26mm 2 $51 24-25mm $147 6 23-24mm 4 $94 22-23mm $158 7 21-22mm $193 9 20-21mm 12 $245 19-20mm $310 16 18-19m

  58. Slide 58: FY 2018 4-Wall Operating Profit by Store

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD (1) FY 2018 4‐Wall Operating Profit by Store # of stores 2 >=7mm $21 3 6-7mm $20 10 5-6mm $53 33 4-5mm $145 80 3-4mm $274 180 2-3mm $437 304 1-2mm $457 >0 -1mm $143 228 <0 ($14) 6 (50) 50 150 250 350 450 550 Aggreg

  59. Slide 59: FY 2019 4-Wall Operating Profit by Store

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD (1) FY 2019 4‐Wall Operating Profit by Store # of stores 7-8mm $0 0 6-7mm $13 2 5-6mm $10 2 4-5mm $63 14 3-4mm $183 53 2-3mm $295 125 1-2mm $423 292 >0 -1mm $194 347 <0 ($16) 11 (50) 50 150 250 350 450 Aggregate St

  60. Slide 60: FY 2018 4-Wall EBITDA by Store

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD (1) FY 2018 4‐Wall EBITDA by Store # of stores >=7mm $12 1 6-7mm 1 $7 5-6mm $11 2 4-5mm $70 16 3-4mm $152 45 2-3mm $283 116 1-2mm $478 329 >0 -1mm $195 324 <0 ($17) 12 (50) 50 150 250 350 450 550 Aggregate Store Gr

  61. Slide 61: FY 2019 4-Wall EBITDA by Store

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD (1) FY 2019 4‐Wall EBITDA by Store # of stores 1 8-9mm $9 2 7-8mm $15 6-7mm 4 $26 5-6mm $61 11 4-5mm $165 37 3-4mm $265 77 2-3mm $435 177 1-2mm $436 293 >0 -1mm $159 239 <0 ($14) 5 (50) 50 150 250 350 450 550 Aggre

  62. Slide 62: Store Closure Summary

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD (1) Store Closure Summary 2019 4-Wall (3) 2019 4-Wall Operating profit (2) Proposed closure status Stores SF (millions) 2019 Sales (millions) EBITDA (millions) (millions) Open – Owned 228 30 $3,055 $599 $468 Closed

  63. Slide 63: Lease Term Remaining

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD Lease Term Remaining 2019 4-Wall (2) Operating Lease 2019 4-Wall Operating profit (1) Term Remaining Stores SF (millions) 2019 Sales (millions) EBITDA (millions) (millions) >= 50 years 12 1 $126 $20 $15 >= 30 years

  64. Slide 64: FY 2019 Rent Expense

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD FY 2019 Rent Expense 2019 4-Wall (2) Operating Lease 2019 4-Wall Operating profit (1) Rent expense PSF Stores SF (millions) 2019 Sales (millions) EBITDA (millions) (millions) Up to $2.00 PSF 64 9 $715 $120 $89 >$2.

  65. Slide 65: FY 2018 Occupancy Costs

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD FY 2018 Occupancy Costs (Owned, Ground Leased and Operating Leased) 2019 4-Wall (2) 2019 4-Wall Operating profit (1) Occupancy cost PSF Stores SF (millions) 2019 Sales (millions) EBITDA (millions) (millions) Up to

  66. Slide 66: FY 2019 Occupancy Costs

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD FY 2019 Occupancy Costs (Owned, Ground Leased and Operating Leased) 2019 4-Wall (2) 2019 4-Wall Operating profit (1) Occupancy cost PSF Stores SF (millions) 2019 Sales (millions) EBITDA (millions) (millions) Up to

  67. Slide 67: Real Estate Appraisal Summary – Lit Value

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD Real Estate Appraisal Summary — “Lit” Value Total Store Base (1) Real Estate Lit Value Appraisal Summary ($ in millions except number of stores) $3,392 $1,995 $1,676 $1,397 $649 $488 $319 $259 -- Owned Ground Lease

  68. Slide 68: Real Estate Appraisal Summary – Dark Value

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD Real Estate Appraisal Summary — “Dark” Value Total Store Base (1) Real Estate Dark Value Appraisal Summary ($ in millions except number of stores) $1,820 $1,124 $979 $696 $404 $151 $141 $146 -- Owned Ground Lease O

  69. Slide 69: Real Estate Appraisal Summary – Warehouses

    81ni 81ni 81ni 81nidZ dZ dZ dZpG pG pG pGqzkS qzkS qzkS qzkSD D D DM M M MpD pD pD pD Real Estate Appraisal Summary — “Lit” and “Dark” Value Total Warehouse Base Real Estate Lit Value Appraisal Summary ($ in millions except number of Real Estate Dark Value Appraisal Summary ($ in millions except num

J C Penney — Investor Presentation (May 2020) on 6ix