NY Post: J.C. Penney Takes Cost-cutting Steps After 'expense Challenge'

(RTTNews) - J.C. Penney Co. Inc. (JCP) slashed payroll, froze overtime for its employees and implemented other cost-cutting measures after it faced an "expense challenge" in the month of April, the New York Post reported, citing an internal memo. Shares of the company are currently down more than 5 percent.

According to the New York Post report, the department store chain asked its store managers to take the emergency measures as it faced an "expense challenge" and unexpected light sales in April.

While J.C. Penney's employees were taken aback as their hours were cut on such short notice, the company was reportedly able to save about 800 hours over a period of two weeks, or about $8,000 per store.

According to the New York Post report, employees who typically work 25 hours a week got their shifts cut to 10 to 15 hours. Both full-time and part-time employees had their hours reduced.

The temporary cost-cutting measures also included restrictions on the use of corporate credit cards, while markdowns were banned.

Plano, Texas-based J.C. Penney will report its first-quarter financial results on May 13. On average, analysts polled by Thomson Reuters expect the company to report loss of $0.36 per share for the quarter on revenues of $2.93 billion. Analysts' estimates typically exclude special items.

In early February, J.C. Penney said it is pursuing the potential sale and partial leaseback of its headquarters building in Plano, Texas as part of efforts to reduce its outstanding debt and effectively manage expenses.

The company said in late January that it plans to re-enter the home appliances business after a gap of more than 30 years, as it grapples with sluggish sales of apparel and accessories.

JCP is trading at $8.45, down $0.49 or 5.38 percent on a volume of 9.94 million shares.