Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
May 04, 2019 | May 24, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | J C PENNEY CO INC | |
Entity Central Index Key | 0001166126 | |
Current Fiscal Year End Date | --02-01 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | May 4, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 316,816,776 | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Trading Symbol | jcp |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Income Statement [Abstract] | ||
Total net sales | $ 2,439 | $ 2,584 |
Credit income and other | 116 | 87 |
Total revenues | 2,555 | 2,671 |
Cost of goods sold (exclusive of depreciation and amortization shown separately below) | 1,630 | 1,712 |
Selling, general and administrative (SG&A) | 856 | 826 |
Depreciation and amortization | 147 | 141 |
Real estate and other, net | 5 | 18 |
Restructuring and management transition | 20 | 7 |
Total costs and expenses | 2,648 | 2,668 |
Operating income/(loss) | (93) | 3 |
Other components of net periodic pension cost/(income) | (13) | (19) |
(Gain)/loss on extinguishment of debt | 0 | 23 |
Net interest expense | 73 | 78 |
Income/(loss) before income taxes | (153) | (79) |
Income tax expense/(benefit) | 1 | (1) |
Net income/(loss) | $ (154) | $ (78) |
Earnings/(loss) per share: | ||
Basic (in dollars per share) | $ (0.48) | $ (0.25) |
Diluted (in dollars per share) | $ (0.48) | $ (0.25) |
Weighted average shares – basic | 317.7 | 313.9 |
Weighted average shares – diluted | 317.7 | 313.9 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS) - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax | $ 0 | |
Net income/(loss) | (154) | $ (78) |
Other comprehensive income/(loss), net of tax: | ||
Reclassification for amortization of prior service (credit)/cost (1) | 2 | 1 |
Gain/(loss) on interest rate swaps (2) | (11) | 5 |
Reclassification for periodic settlements (3) | (2) | 0 |
Total other comprehensive income/(loss), net of tax | (11) | 6 |
Total comprehensive income/(loss), net of tax | (165) | (72) |
Other Comprehensive (Income) Loss, Defined Benefit Plan, Prior Service Cost (Credit), Reclassification Adjustment from AOCI, Tax | 0 | (1) |
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Tax | 0 | $ (1) |
Interest Expense [Member] | ||
Other comprehensive income/(loss), net of tax: | ||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, before Tax | $ (2) |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS) Consolidated Statements of Comprehensive Income/(loss) Parenthetical - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Other Comprehensive (Income) Loss, Defined Benefit Plan, Prior Service Cost (Credit), Reclassification Adjustment from AOCI, Tax | $ 0 | $ (1) |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax | 0 | |
Other components of net periodic pension and postretirement cost/(income) [Member] | ||
Other Comprehensive (Income) Loss, Defined Benefit Plan, Prior Service Cost (Credit), Reclassification Adjustment from AOCI, before Tax | 2 | $ 2 |
Interest Expense [Member] | ||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, before Tax | $ (2) |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | May 04, 2019 | Feb. 02, 2019 | May 05, 2018 | |
Current assets: | ||||
Cash in banks and in transit | $ 160 | $ 109 | $ 170 | |
Cash short-term investments | 11 | 224 | 11 | |
Cash and cash equivalents | 171 | 333 | 181 | |
Merchandise inventory | 2,477 | 2,437 | 2,948 | |
Prepaid expenses and other | 287 | 189 | 223 | |
Total current assets | 2,935 | 2,959 | 3,352 | |
Property and equipment (net of accumulated depreciation of $3,339, $3,556 and $3,425) | 3,669 | 3,938 | 4,200 | |
Operating lease assets | 917 | 0 | 0 | |
Prepaid pension | 156 | 147 | 74 | |
Other assets | 665 | 677 | 679 | |
Total Assets | 8,342 | 7,721 | 8,305 | |
Current liabilities: | ||||
Merchandise accounts payable | 842 | 847 | 933 | |
Other accounts payable and accrued expenses | 925 | 995 | 957 | |
Current operating lease liabilities | 84 | 0 | 0 | |
Current portion of finance leases and note payable | 2 | 8 | 7 | |
Current maturities of long-term debt | 92 | 92 | 42 | |
Total current liabilities | 1,945 | 1,942 | 1,939 | |
Operating Lease, Liability, Noncurrent | 1,082 | 0 | 0 | |
Long-term finance leases and note payable | 1 | 204 | 210 | |
Long-term debt | 3,826 | 3,716 | 4,142 | |
Deferred taxes | 119 | 131 | 142 | |
Other liabilities | 335 | 558 | 557 | |
Total Liabilities | 7,308 | 6,551 | 6,990 | |
Stockholders’ Equity | ||||
Common stock | [1] | 158 | 158 | 157 |
Additional paid-in capital | 4,715 | 4,713 | 4,708 | |
Reinvested earnings/(accumulated deficit) | (3,553) | (3,373) | (3,196) | |
Accumulated other comprehensive income/(loss) | (286) | (328) | (354) | |
Total Stockholders’ Equity | 1,034 | 1,170 | 1,315 | |
Total Liabilities and Stockholders’ Equity | $ 8,342 | $ 7,721 | $ 8,305 | |
[1] | 1.25 billion shares of common stock are authorized with a par value of $0.50 per share. The total shares issued and outstanding were 316.8 million, 314.3 million and 316.1 million as of May 4, 2019, May 5, 2018 and February 2, 2019, respectively. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | May 04, 2019 | Feb. 02, 2019 | May 05, 2018 |
Statement of Financial Position [Abstract] | |||
Accumulated depreciation | $ (3,339) | $ (3,425) | $ (3,556) |
Common stock, shares authorized | 1,250,000,000 | 1,250,000,000 | 1,250,000,000 |
Common stock, par value per share | $ 0.50 | $ 0.50 | $ 0.5 |
Common stock, shares issued | 316,800,000 | 316,100,000 | 314,300,000 |
Common stock, shares outstanding | 316,800,000 | 316,100,000 | 314,300,000 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY Statement - USD ($) shares in Millions, $ in Millions | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Reinvested Earnings/(Accumulated Deficit) [Member] | Accumulated Other Comprehensive Income/(Loss) [Member] |
Common Stock, Shares, Outstanding | 312 | ||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 1,383 | $ 156 | $ 4,705 | $ (3,118) | $ (360) |
Net income/(loss) | (78) | (78) | |||
Other comprehensive income/(loss) | 6 | 6 | |||
Stock-based compensation, shares | 2.3 | ||||
Stock-based compensation and other | $ 4 | $ 1 | 3 | ||
Common Stock, Shares, Outstanding | 314.3 | 314.3 | |||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 1,315 | $ 157 | 4,708 | (3,196) | (354) |
Common Stock, Shares, Outstanding | 316.1 | 316.1 | |||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 1,170 | $ 158 | 4,713 | (3,373) | (328) |
ASC 842 (Leases) and ASU 2018-02 (Stranded Taxes) adoption (See Note 2) | 27 | (26) | 53 | ||
Net income/(loss) | (154) | (154) | |||
Other comprehensive income/(loss) | (11) | (11) | |||
Stock-based compensation, shares | 0.7 | ||||
Stock-based compensation and other | $ 2 | $ 0 | 2 | ||
Common Stock, Shares, Outstanding | 316.8 | 316.8 | |||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 1,034 | $ 158 | $ 4,715 | $ (3,553) | $ (286) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Cash flows from operating activities | ||
Net income/(loss) | $ (154) | $ (78) |
Adjustments to reconcile net income/(loss) to net cash provided by/(used in) operating activities: | ||
Restructuring and management transition | 15 | (3) |
Asset impairments and other charges | 0 | 1 |
Net gain on sale of operating assets | (4) | (17) |
(Gain)/loss on extinguishment of debt | 0 | 23 |
Depreciation and amortization | 147 | 141 |
Benefit plans | (14) | (19) |
Stock-based compensation | 2 | 7 |
Deferred taxes | (3) | (2) |
Change in cash from: | ||
Inventory | (40) | (145) |
Prepaid expenses and other | (98) | (33) |
Merchandise accounts payable | (5) | (40) |
Income taxes | 3 | (3) |
Accrued expenses and other | (54) | (186) |
Net Cash Provided by (Used in) Operating Activities | (205) | (354) |
Cash flows from investing activities | ||
Capital expenditures | (71) | (106) |
Net proceeds from sale of operating assets | 8 | 39 |
Net Cash Provided by (Used in) Investing Activities | (63) | (67) |
Cash flows from financing activities | ||
Proceeds from issuance of long-term debt | 0 | 400 |
Proceeds from borrowings under the credit facility | 408 | 977 |
Payments of borrowings under the credit facility | (290) | (626) |
Premium on early retirement of debt | 0 | 20 |
Payments of finance leases and note payable | (1) | (2) |
Payments of long-term debt | (11) | (576) |
Financing costs | 0 | (7) |
Proceeds from stock issued under stock plans | 0 | 1 |
Tax withholding payments for vested restricted stock | 0 | (3) |
Net Cash Provided by (Used in) Financing Activities | 106 | 144 |
Net increase/(decrease) in cash and cash equivalents | (162) | (277) |
Cash and cash equivalents at beginning of period | 333 | 458 |
Cash and cash equivalents at end of period | 171 | 181 |
Supplemental cash flow information | ||
Income taxes received/(paid), net | (2) | (4) |
Interest received/(paid), net | (91) | (113) |
Supplemental non-cash investing and financing activity | ||
Increase/(decrease) in other accounts payable related to purchases of property and equipment and software | (18) | (16) |
Remeasurement of leased assets and lease obligations | $ 28 | $ 0 |
Basis of Presentation and Conso
Basis of Presentation and Consolidation | 3 Months Ended |
May 04, 2019 | |
Basis of Presentation and Consolidation [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation Basis of Presentation 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 holding company has no independent assets or operations, and no direct subsidiaries other than JCP. The holding company and its consolidated subsidiaries, including JCP, are collectively referred to in this quarterly report as “we,” “us,” “our,” “ourselves” or the “Company,” unless otherwise indicated. J. C. Penney Company, Inc. is a co-obligor (or guarantor, as appropriate) regarding the payment of principal and interest on JCP’s outstanding debt securities. The guarantee of certain of JCP’s outstanding debt securities by J. C. Penney Company, Inc. is full and unconditional. These unaudited Interim Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and in accordance with the rules and regulations of the Securities and Exchange Commission (SEC). The accompanying unaudited Interim Consolidated Financial Statements, in our opinion, include all material adjustments necessary for a fair presentation and should be read in conjunction with the audited Consolidated Financial Statements and notes thereto in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019 ( 2018 Form 10-K). We follow the same accounting policies to prepare quarterly financial statements as are followed in preparing annual financial statements. A description of such significant accounting policies is included in the 2018 Form 10-K. The February 2, 2019 financial information was derived from the audited Consolidated Financial Statements, with related footnotes, included in the 2018 Form 10-K. Because of the seasonal nature of the retail business, operating results for interim periods are not necessarily indicative of the results that may be expected for the full year. Fiscal Year Our fiscal year ends on the Saturday closest to January 31. As used herein, “three months ended May 4, 2019 ” and “ first quarter of 2019 ” refer to the 13-week period ended May 4, 2019 , and “three months ended May 5, 2018 ” and “ first quarter of 2018 ” refer to the 13-week period ended May 5, 2018 . Fiscal years 2019 and 2018 contain 52 weeks. Basis of Consolidation All significant inter-company transactions and balances have been eliminated in consolidation. Certain reclassifications were made to prior period amounts to conform to the current period presentation. |
Adoption of New Accounting Stan
Adoption of New Accounting Standards (Notes) | 3 Months Ended |
May 04, 2019 | |
Adoption of New Accounting Standards [Abstract] | |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | Adoption of New Accounting Standards In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Codification (ASC) Topic 842, Leases (Topic 842), a replacement of Leases (Topic 840) and updated by various targeted improvements , which requires lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets. The Company adopted the provisions of the new lease standard effective February 3, 2019, using the modified retrospective adoption method and the simplified transition option available in the new lease standard. This allows us to continue to apply the legacy guidance in the old standard (ASC Topic 840, Leases (ASC 840)), including its disclosure requirements, in the comparative periods presented in the year of adoption. The Company also elected the package of practical expedients available under the transition provisions of the new lease standard, which include a) not reassessing ASC 840 evaluations on whether expired or existing contracts contain leases, b) not reassessing lease classification, under ASC 840, and c) not revaluing initial direct costs for existing leases under ASC 840. We also elected the practical expedient to carry forward our historical accounting for any land easements on existing contracts. In addition, the Company changed the accounting for the failed sale-leaseback of its home office to comply with the new lease standard's guidance for sale-leaseback accounting, and recorded a "day one impairment" of the new right-of-use assets that were included in previously impaired asset groups associated with long-lived assets. Per the transition guidance of the new lease standard, the failed sale-leaseback is considered a valid sale and leaseback that resulted in the removal of the related real estate assets of $153 million and the financing obligation of $208 million , and the recognition of the $55 million gain on sale in Reinvested earnings/(accumulated deficit). Adoption of the new lease accounting standard also required us to reevaluate the accounting for a $50 million promissory note issued in connection with the sale of the home office. In accordance with previous guidance, the promissory note was not recorded in the unaudited Interim Consolidated Balance Sheets and not included in the implied gain on sale, however, under the new guidance, the promissory note is considered variable consideration under ASC 606, Revenue for Contracts with Customers . Accordingly, in transition, the Company did not recognize any amount for the $50 million promissory note, as management assessed the most likely amount of variable consideration to be zero given the associated local real estate market dynamics. In regards to the "day one impairment" charge, the Company evaluated the new right-of-use assets added to certain store asset groups that were previously determined to be impaired. Given the facts and circumstances that were still in existence upon adopting the new lease standard, the Company recorded an approximate $40 million impairment charge to Reinvested earnings/(accumulated deficit) to adjust the net book value of the new right-of-use assets to their fair value. The following table provides the overall unaudited Interim Consolidated Balance Sheet impact of applying the new lease standard effective as of February 3, 2019. Due to the change in accounting for the Home Office sale-leaseback, there was a change in classification of $5 million in lease costs from Depreciation and amortization and Net interest expense in the prior year period to Selling, general and administrative expenses in the current year period. There was no significant impact to the Company's unaudited Interim Consolidated Statement of Cash Flows. Balance as of February 3, 2019 ($ in millions) Balances removed under prior accounting Balances added/reclassified under new lease standard Net impact of new lease standard Prepaid expenses and other $ — $ (5 ) $ (5 ) Property and equipment 153 — (153 ) Operating lease assets — 910 910 Other assets — (7 ) (7 ) Total assets $ 153 $ 898 $ 745 Other accounts payable and accrued expenses $ 4 $ — $ (4 ) Current operating lease liabilities — 85 85 Current portion of finance leases and note payable 5 — (5 ) Noncurrent operating lease liabilities — 1,074 1,074 Long-term finance leases and note payable 203 — (203 ) Deferred taxes 10 — (10 ) Other liabilities 11 (208 ) (219 ) Reinvested earnings/(accumulated deficit) 80 (53 ) 27 Total liabilities and stockholders’ equity $ 153 $ 898 $ 745 In February 2018, the FASB issued ASU 2018-02, Income Statement-Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . This standard allows companies to reclassify stranded tax effects resulting from the Tax Cuts and Jobs Act (the “Tax Act”) enacted on December 22, 2017 from Accumulated other comprehensive income/(loss) to Reinvested earnings/(accumulated deficit). We adopted ASU 2018-02 on February 3, 2019 and reclassified $53 million (net of federal income tax benefit) of income tax effects of the Tax Act from Accumulated other comprehensive income/(loss) to Reinvested earnings/(accumulated deficit). Effect of New Accounting Standards On August 28, 2018, the FASB issued ASU 2018-13, Fair Value Measurement . This standard is effective for public business entities in fiscal years beginning after December 15, 2019, and for interim periods within those years. Early adoption is permitted, including during an interim period. This new standard requires changes to the disclosure requirements for fair value measurements for certain Level 3 items, and specifies that some of the changes must be applied prospectively, while others should be applied retrospectively. The Company is evaluating this new standard, but does not expect it to have a significant impact on its financial statement disclosures. |
Effect of New Accounting Standa
Effect of New Accounting Standards | 3 Months Ended |
May 04, 2019 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Effect of New Accounting Standards | Adoption of New Accounting Standards In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Codification (ASC) Topic 842, Leases (Topic 842), a replacement of Leases (Topic 840) and updated by various targeted improvements , which requires lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets. The Company adopted the provisions of the new lease standard effective February 3, 2019, using the modified retrospective adoption method and the simplified transition option available in the new lease standard. This allows us to continue to apply the legacy guidance in the old standard (ASC Topic 840, Leases (ASC 840)), including its disclosure requirements, in the comparative periods presented in the year of adoption. The Company also elected the package of practical expedients available under the transition provisions of the new lease standard, which include a) not reassessing ASC 840 evaluations on whether expired or existing contracts contain leases, b) not reassessing lease classification, under ASC 840, and c) not revaluing initial direct costs for existing leases under ASC 840. We also elected the practical expedient to carry forward our historical accounting for any land easements on existing contracts. In addition, the Company changed the accounting for the failed sale-leaseback of its home office to comply with the new lease standard's guidance for sale-leaseback accounting, and recorded a "day one impairment" of the new right-of-use assets that were included in previously impaired asset groups associated with long-lived assets. Per the transition guidance of the new lease standard, the failed sale-leaseback is considered a valid sale and leaseback that resulted in the removal of the related real estate assets of $153 million and the financing obligation of $208 million , and the recognition of the $55 million gain on sale in Reinvested earnings/(accumulated deficit). Adoption of the new lease accounting standard also required us to reevaluate the accounting for a $50 million promissory note issued in connection with the sale of the home office. In accordance with previous guidance, the promissory note was not recorded in the unaudited Interim Consolidated Balance Sheets and not included in the implied gain on sale, however, under the new guidance, the promissory note is considered variable consideration under ASC 606, Revenue for Contracts with Customers . Accordingly, in transition, the Company did not recognize any amount for the $50 million promissory note, as management assessed the most likely amount of variable consideration to be zero given the associated local real estate market dynamics. In regards to the "day one impairment" charge, the Company evaluated the new right-of-use assets added to certain store asset groups that were previously determined to be impaired. Given the facts and circumstances that were still in existence upon adopting the new lease standard, the Company recorded an approximate $40 million impairment charge to Reinvested earnings/(accumulated deficit) to adjust the net book value of the new right-of-use assets to their fair value. The following table provides the overall unaudited Interim Consolidated Balance Sheet impact of applying the new lease standard effective as of February 3, 2019. Due to the change in accounting for the Home Office sale-leaseback, there was a change in classification of $5 million in lease costs from Depreciation and amortization and Net interest expense in the prior year period to Selling, general and administrative expenses in the current year period. There was no significant impact to the Company's unaudited Interim Consolidated Statement of Cash Flows. Balance as of February 3, 2019 ($ in millions) Balances removed under prior accounting Balances added/reclassified under new lease standard Net impact of new lease standard Prepaid expenses and other $ — $ (5 ) $ (5 ) Property and equipment 153 — (153 ) Operating lease assets — 910 910 Other assets — (7 ) (7 ) Total assets $ 153 $ 898 $ 745 Other accounts payable and accrued expenses $ 4 $ — $ (4 ) Current operating lease liabilities — 85 85 Current portion of finance leases and note payable 5 — (5 ) Noncurrent operating lease liabilities — 1,074 1,074 Long-term finance leases and note payable 203 — (203 ) Deferred taxes 10 — (10 ) Other liabilities 11 (208 ) (219 ) Reinvested earnings/(accumulated deficit) 80 (53 ) 27 Total liabilities and stockholders’ equity $ 153 $ 898 $ 745 In February 2018, the FASB issued ASU 2018-02, Income Statement-Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . This standard allows companies to reclassify stranded tax effects resulting from the Tax Cuts and Jobs Act (the “Tax Act”) enacted on December 22, 2017 from Accumulated other comprehensive income/(loss) to Reinvested earnings/(accumulated deficit). We adopted ASU 2018-02 on February 3, 2019 and reclassified $53 million (net of federal income tax benefit) of income tax effects of the Tax Act from Accumulated other comprehensive income/(loss) to Reinvested earnings/(accumulated deficit). Effect of New Accounting Standards On August 28, 2018, the FASB issued ASU 2018-13, Fair Value Measurement . This standard is effective for public business entities in fiscal years beginning after December 15, 2019, and for interim periods within those years. Early adoption is permitted, including during an interim period. This new standard requires changes to the disclosure requirements for fair value measurements for certain Level 3 items, and specifies that some of the changes must be applied prospectively, while others should be applied retrospectively. The Company is evaluating this new standard, but does not expect it to have a significant impact on its financial statement disclosures. |
Leases (Notes)
Leases (Notes) | 3 Months Ended |
May 04, 2019 | |
Leases [Abstract] | |
Leases of Lessee Disclosure [Text Block] | Leases We conduct a major part of our operations from leased premises (building or land) that include retail stores, store distribution centers, warehouses, offices and other facilities. Almost all leases include renewal options where we can extend the lease term from one to 50 years or more. We also lease equipment under finance leases of primarily three to five year periods, and we rent or sublease certain real estate to third parties. Our lease contracts do not contain any purchase options or residual value guarantees. Accounting Policy Applied in Fiscal 2019 At the lease commencement date, based on certain criteria, we determine if a lease is classified as an operating lease or finance lease and then recognize a right-of-use asset and a lease liability on the Consolidated Balance Sheets for all leases (with the exception of leases that have a term of twelve months or less). The lease liability is measured as the present value of unpaid lease payments measured based on the reasonably certain lease term and corresponding discount rate. The initial right-of-use asset is measured as the lease liability plus certain other costs and is reduced by any tenant allowances collected from the lessor. Lease payments include fixed and in-substance fixed payments, variable payments based on an index or rate and termination penalties. Lease payments do not include variable lease payments other than those that depend on an index or rate or any payments not considered part of the lease (i.e. payment of the lessor’s real estate taxes and insurance). Payments not considered lease payments are expensed as incurred. Some leases require additional payments based on sales and the related contingent rent is recorded as rent expense when the payment is probable. As a policy election, we consider lease payments and all related other payments as one component of a lease. The reasonably certain lease term includes the non-cancelable lease term and any renewal option periods where we have economically compelling reasons for future exercise. The discount rate used in our present value calculations is the rate implicit in the lease, when known, or our estimated incremental borrowing rate. Our incremental borrowing rate is estimated based on our secured borrowings and our credit risk relative to the time horizons of other publicly available data points that are consistent with the respective lease term. Whether an operating lease or a finance lease, the lease liability is amortized over the lease term at a constant periodic interest rate. The right-of-use assets related to operating leases are amortized over the lease term on a basis that renders a straight-line amount of rent expense which encompasses the amortization and interest component of the lease. With the occurrence of certain events, the amortization pattern for an operating asset is adjusted to a straight-line basis over the remaining lease term. The right-of-use asset related to a finance lease is amortized on a straight-line basis over the lease term. Rent on short-term leases are expensed on a straight-line basis over the lease term. When a lease is modified or there is a change in lease term, we assess for any change in lease classification and remeasure the lease liability with a corresponding increase or decrease to the right-of-use asset. Sale-leasebacks are transactions through which we sell assets and subsequently lease them back. The resulting leases that qualify for sale-leaseback accounting are evaluated and accounted for as an operating lease. A transaction that does not qualify for sale-leaseback accounting as a result of finance lease classification or the failure to meet certain revenue recognition criteria is accounted for as a financing transaction. For a financing transaction, we retain the "sold" assets within property and equipment and record a financing obligation equal to the amount of cash proceeds received. Rental payments under such transactions are recognized as a reduction of the financing obligation and as interest expense using an effective interest method. Accounting Policy Applied in Fiscal 2018 Our lease accounting policies for lease contracts in fiscal 2018 and prior are disclosed in the 2018 Form 10-K. Leases ($ in millions) Classification May 4, 2019 Assets Operating lease assets Operating lease assets $ 917 Finance lease assets Property and equipment 1 Total leased assets $ 918 Liabilities Current Operating Current operating lease liabilities $ 84 Finance Current portion of finance leases and note payable 1 Noncurrent Operating Noncurrent operating lease liabilities 1,082 Finance Long-term finance leases and note payable 1 Total leased liabilities $ 1,168 Lease Cost Three Months Ended ($ in millions) Classification May 4, 2019 Operating lease cost Selling, general and administrative expense (SG&A) $ 48 Variable lease cost Selling, general and administrative expense (SG&A) 32 Finance lease cost Amortization of leased assets Depreciation and amortization — Interest on lease liabilities Net interest expense — Rental income Real estate and other, net 2 Net lease cost $ 78 As of May 4, 2019 , future lease payments were as follows: ($ in millions) Operating Leases Finance Leases Total 2019 $ 156 $ 1 $ 157 2020 195 1 196 2021 187 — 187 2022 173 — 173 2023 166 — 166 Thereafter 1,816 2 1,818 Total lease payments 2,693 4 2,697 Less: amounts representing interest (1,527 ) (2 ) (1,529 ) Present value of lease liabilities $ 1,166 $ 2 $ 1,168 Lease term and discount rate are as follows: May 4, Weighted-average remaining lease term (years) Operating leases 16 Financing leases 1 Weighted-average discount rate Operating leases 11 % Financing leases 6 % Other information: Three Months Ended ($ in millions) May 4, Cash paid for amounts included in the measurement of these liabilities Operating cash flows from operating leases 51 Operating cash flows from finance leases 1 Financing cash flows from finance leases 1 As determined prior to the adoption of the new lease standard, the future minimum lease payments under operating leases in effect as of February 2, 2019 were as follows: ($ in millions) 2019 $ 190 2020 178 2021 163 2022 148 2023 135 Thereafter 1,626 Less: sublease income (43 ) Total minimum lease payments $ 2,397 |
Revenue (Notes)
Revenue (Notes) | 3 Months Ended |
May 04, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | Revenue Our contracts with customers primarily consist of sales of merchandise and services at the point of sale, sales of gift cards to a customer for a future purchase, customer loyalty rewards that provide discount rewards to customers based on purchase activity, and certain licensing and profit sharing arrangements involving the use of our intellectual property by others. Revenue includes Total net sales and Credit income and other. Net sales are categorized by merchandise and service sale groupings as we believe it best depicts the nature, amount, timing and uncertainty of revenue and cash flow. The following table provides the components of Net sales for the three months ended May 4, 2019 and May 5, 2018 : Three Months Ended ($ in millions) May 4, 2019 May 5, 2018 Women’s apparel $ 590 24 % $ 614 24 % Men’s apparel and accessories 478 20 % 500 19 % Women’s accessories, including Sephora 349 14 % 378 15 % Home 305 13 % 354 14 % Children’s, including toys 200 8 % 207 8 % Footwear 181 7 % 189 7 % Jewelry 167 7 % 162 6 % Services and other 169 7 % 180 7 % Total net sales $ 2,439 100 % $ 2,584 100 % Credit income and other encompasses the revenue earned from the agreement with Synchrony Financial (Synchrony) associated with our private label credit card and co-branded MasterCard® programs. The Company has contract liabilities associated with the sales of gift cards and our customer loyalty program. The liabilities are included in Other accounts payable and accrued expenses in the unaudited Interim Consolidated Balance Sheets and were as follows: (in millions) May 4, 2019 May 5, 2018 February 2, 2019 Gift cards $ 121 $ 124 $ 140 Loyalty rewards 61 71 60 Total contract liability $ 182 $ 195 $ 200 Contract liability includes consideration received for gift card and loyalty related performance obligations which have not been satisfied as of a given date. A rollforward of the amounts included in contract liability for the first three months of 2019 and 2018 are as follows: (in millions) 2019 2018 Beginning balance $ 200 $ 217 Current period gift cards sold and loyalty reward points earned 78 74 Net sales from amounts included in contract liability opening balances (36 ) (38 ) Net sales from current period usage (60 ) (58 ) Ending balance $ 182 $ 195 |
Earnings_(Loss) per Share
Earnings/(Loss) per Share | 3 Months Ended |
May 04, 2019 | |
Earnings Per Share [Abstract] | |
Earnings/(Loss) per Share | Earnings/(Loss) per Share Net income/(loss) and shares used to compute basic and diluted earnings/(loss) per share (EPS) are reconciled below: Three Months Ended (in millions, except per share data) May 4, May 5, Earnings/(loss) Net income/(loss) $ (154 ) $ (78 ) Shares Weighted average common shares outstanding (basic shares) 317.7 313.9 Adjustment for assumed dilution: Stock options, restricted stock awards and warrant — — Weighted average shares assuming dilution (diluted shares) 317.7 313.9 EPS Basic $ (0.48 ) $ (0.25 ) Diluted $ (0.48 ) $ (0.25 ) The following average potential shares of common stock were excluded from the diluted EPS calculation because their effect would have been anti-dilutive: Three Months Ended (Shares in millions) May 4, May 5, Stock options, restricted stock awards and warrant 22.5 29.3 |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
May 04, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt ($ in millions) May 4, 2019 May 5, 2018 February 2, 2019 Issue: 8.125% Senior Notes Due 2019 $ 50 $ 50 $ 50 5.65% Senior Notes Due 2020 (1) 110 110 110 2017 Credit Facility (Matures in 2022) 118 351 — 2016 Term Loan Facility (Matures in 2023) 1,572 1,614 1,583 5.875% Senior Secured Notes Due 2023 (1) 500 500 500 7.125% Debentures Due 2023 10 10 10 8.625% Senior Secured Second Priority Notes Due 2025 (1) 400 400 400 6.9% Notes Due 2026 2 2 2 6.375% Senior Notes Due 2036 (1) 388 388 388 7.4% Debentures Due 2037 313 313 313 7.625% Notes Due 2097 500 500 500 Total debt 3,963 4,238 3,856 Unamortized debt issuance costs (45 ) (54 ) (48 ) Less: current maturities (92 ) (42 ) (92 ) Total long-term debt $ 3,826 $ 4,142 $ 3,716 (1) These debt issuances contain a change of control provision that would obligate us, at the holders’ option, to repurchase the debt at a price of 101%. As of May 4, 2019 , outstanding borrowings under our $2.35 billion senior secured asset-based revolving credit facility (2017 Credit Facility) were $118 million . All borrowings under the 2017 Credit Facility accrue interest at a rate equal to, at the Company’s option, a base rate or an adjusted LIBOR rate plus a spread. |
Derivative Financial Instrument
Derivative Financial Instruments (Notes) | 3 Months Ended |
May 04, 2019 | |
Derivative [Line Items] | |
Derivative Instruments and Hedging Activities Disclosure [Text Block] | Derivative Financial Instruments We use derivative financial instruments for hedging and non-trading purposes to manage our exposure to changes in interest rates. Use of derivative financial instruments in hedging programs subjects us to certain risks, such as market and credit risks. Market risk represents the possibility that the value of the derivative instrument will change. In a hedging relationship, the change in the value of the derivative is offset to a great extent by the change in the value of the underlying hedged item. Credit risk related to derivatives represents the possibility that the counterparty will not fulfill the terms of the contract. The notional, or contractual, amount of our derivative financial instruments is used to measure interest to be paid or received and does not represent our exposure due to credit risk. Credit risk is monitored through established approval procedures, including setting concentration limits by counterparty, reviewing credit ratings and requiring collateral (generally cash) from the counterparty when appropriate. When we use derivative financial instruments for the purpose of hedging our exposure to interest rates, the contract terms of a hedged instrument closely mirror those of the hedged item, providing a high degree of risk reduction and correlation. Contracts that are effective at meeting the risk reduction and correlation criteria are recorded using hedge accounting. If a derivative instrument is a hedge, depending on the nature of the hedge, changes in the fair value of the instrument will either be offset against the change in fair value of the hedged assets, liabilities or firm commitments through earnings or be recognized in Accumulated other comprehensive income/(loss) until the hedged item is recognized in earnings. The ineffective portion of an instrument’s change in fair value will be immediately recognized in earnings during the period. Instruments that do not meet the criteria for hedge accounting, or contracts for which we have not elected to apply hedge accounting, are valued at fair value with unrealized gains or losses reported in earnings during the period of change. We are party to interest rate swap agreements with notional amounts totaling $1,250 million to fix a portion of our variable LIBOR-based interest payments. The interest rate swap agreements have a weighted-average fixed rate of 2.04% , mature on May 7, 2020 and have been designated as cash flow hedges. On September 4, 2018 we entered into additional forward interest rate swap agreements with notional amounts totaling $750 million to fix a portion of our variable LIBOR-based interest payments. The forward interest rate swap agreements have a weighted-average fixed rate of 3.135% , have an effective date from May 7, 2020 to May 7, 2025 and have been designated as cash flow hedges. The fair value of our interest rate swaps are recorded in the unaudited Interim Consolidated Balance Sheets as an asset or a liability (see Note 10) based upon its change in fair values from its effective date. The effective portion of the interest rate swaps' changes in fair values is reported in Accumulated other comprehensive income/(loss) (see Note 11), and the ineffective portion is reported in Net income/(loss). Amounts in Accumulated other comprehensive income/(loss) are reclassified into Net income/(loss) when the related interest payments affect earnings. For the periods presented, all of the interest rate swaps were 100% effective. Information regarding the gross amounts of our derivative instruments in the unaudited Interim Consolidated Balance Sheets is as follows: Asset Derivatives at Fair Value Liability Derivatives at Fair Value ($ in millions) Balance Sheet Location May 4, 2019 May 5, 2018 February 2, 2019 Balance Sheet Location May 4, 2019 May 5, 2018 February 2, 2019 Derivatives designated as hedging instruments: Interest rate swaps Prepaid expenses and other $ 1 $ — $ — Other accounts payable and accrued expenses $ — $ — $ — Interest rate swaps Other assets 6 16 10 Other liabilities 25 — 15 Total derivatives designated as hedging instruments $ 7 $ 16 $ 10 $ 25 $ — $ 15 |
Restructuring and Management Tr
Restructuring and Management Transition | 3 Months Ended |
May 04, 2019 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Management Transition | Restructuring and Management Transition In the first quarter of 2019, the Company finalized plans to close 18 full-line stores and 9 ancillary home and furniture stores, further aligning the Company's brick-and-mortar presence with its omnichannel network, and enabling capital resources to be reallocated to locations and initiatives that offer the greatest long-term value potential. The planned store closures resulted in a $14 million asset impairment charge for store assets with limited future use and a $1 million severance charge for the expected displacement of store associates. The components of Restructuring and management transition include: • Home office and stores — charges for actions to reduce our store and home office expenses including employee termination benefits, store lease termination and impairment charges; • Management transition — charges related to implementing changes within our management leadership team for both incoming and outgoing members of management; and • Other — charges related primarily to contract termination costs and costs related to the closure of certain supply chain locations. The composition of Restructuring and management transition charges was as follows: Three Months Ended Cumulative Amount From Program Inception Through May 4, 2019 ($ in millions) May 4, May 5, Home office and stores $ 19 $ 7 $ 505 Management transition 1 — 265 Other — — 186 Total $ 20 $ 7 $ 956 Activity for the Restructuring and management transition liability for the three months ended May 4, 2019 was as follows: ($ in millions) Home Office and Stores Other Total February 2, 2019 $ 16 $ 2 $ 18 ASC 842 (Leases) adoption (See Note 2) (15 ) — (15 ) Charges 6 1 7 Cash payments (2 ) (3 ) (5 ) May 4, 2019 $ 5 $ — $ 5 |
Fair Value Disclosures
Fair Value Disclosures | 3 Months Ended |
May 04, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures | Fair Value Disclosures In determining fair value, the accounting standards establish a three level hierarchy for inputs used in measuring fair value, as follows: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Significant observable inputs other than quoted prices in active markets for similar assets and liabilities, such as quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. • Level 3 — Significant unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants. Cash Flow Hedges Measured on a Recurring Basis The fair value of our cash flow hedges are valued in the market using discounted cash flow techniques, which use quoted market interest rates in discounted cash flow calculations that consider the instrument's term, notional amount, discount rate and credit risk. Significant inputs to the derivative valuation for interest rate swaps are observable in the active markets and are classified as Level 2 in the fair value measurement hierarchy. Other Non-Financial Assets Measured on a Non-Recurring Basis In connection with the Company announcing its plan to close underperforming stores in 2019, long-lived assets held and used with a carrying value of $22 million were written down to their fair value of $8 million , resulting in asset impairment charges of $14 million in the first quarter of 2019. Additionally, in connection with the adoption of the new lease accounting standard, right-of-use assets of $58 million were written down to their fair value of $19 million . The fair value was determined based on comparable market values of similar properties or on a rental income approach and the significant inputs related to valuing the store related assets are classified as Level 2 in the fair value measurement hierarchy. Other Financial Instruments Carrying values and fair values of financial instruments that are not carried at fair value in the unaudited Interim Consolidated Balance Sheets are as follows: May 4, 2019 May 5, 2018 February 2, 2019 ($ in millions) Carrying Amount Fair Value Carrying Amount Fair Value Carrying Amount Fair Value Total debt, excluding unamortized debt issuance costs, finance leases and note payable $ 3,963 $ 2,833 $ 4,238 $ 3,712 $ 3,856 $ 2,579 The fair value of long-term debt was estimated by obtaining quotes from brokers or was based on current rates offered for similar debt. As of May 4, 2019 , May 5, 2018 and February 2, 2019 , the fair values of cash and cash equivalents and accounts payable approximated their carrying values due to the short-term nature of these instruments. Concentrations of Credit Risk We have no significant concentrations of credit risk. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
May 04, 2019 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Accumulated Other Comprehensive Income/(Loss) The following tables show the changes in accumulated other comprehensive income/(loss) balances for the three months ended May 4, 2019 and the three months ended May 5, 2018 : ($ in millions) Net Actuarial Gain/(Loss) Prior Service Credit/(Cost) Foreign Currency Translation Gain/(Loss) on Cash Flow Hedges Accumulated Other Income/(Loss) February 2, 2019 $ (290 ) $ (22 ) $ (1 ) $ (15 ) $ (328 ) ASU 2018-02 (Stranded Taxes) adoption (See Note 2) 46 3 — 4 53 Other comprehensive income/(loss) before reclassifications — — — (11 ) (11 ) Amounts reclassified from accumulated other comprehensive income — 2 — (2 ) — May 4, 2019 $ (244 ) $ (17 ) $ (1 ) $ (24 ) $ (286 ) ($ in millions) Net Actuarial Prior Service Foreign Currency Translation Gain/(Loss) on Cash Flow Hedges Accumulated February 3, 2018 $ (330 ) $ (26 ) $ — $ (4 ) $ (360 ) Other comprehensive income/(loss) before reclassifications — — — 5 5 Amounts reclassified from accumulated other comprehensive income — 1 — — 1 May 5, 2018 $ (330 ) $ (25 ) $ — $ 1 $ (354 ) |
Retirement Benefit Plans
Retirement Benefit Plans | 3 Months Ended |
May 04, 2019 | |
Retirement Benefit Plans [Abstract] | |
Retirement Benefit Plans | Retirement Benefit Plans The components of net periodic pension expense/(income) for our non-contributory qualified defined benefit pension plan and supplemental pension plans were as follows: Three Months Ended ($ in millions) May 4, May 5, Service cost $ 7 $ 9 Other components of net periodic pension cost/(income): Interest cost 33 35 Expected return on plan assets (48 ) (56 ) Amortization of prior service cost/(credit) 2 2 (13 ) (19 ) Net periodic pension expense/(income) $ (6 ) $ (10 ) Service cost is included in SG&A in the unaudited Interim Consolidated Statements of Operations. |
Real Estate and Other, Net
Real Estate and Other, Net | 3 Months Ended |
May 04, 2019 | |
Real Estate and Other, Net [Abstract] | |
Real Estate and Other, Net | Real Estate and Other, Net Real estate and other consists of ongoing operating income from our real estate subsidiaries. Real estate and other also includes net gains from the sale of facilities and equipment that are no longer used in operations, asset impairments, accruals for certain litigation and other non-operating charges and credits. The composition of Real estate and other, net was as follows: Three Months Ended ($ in millions) May 4, May 5, Net gain from sale of operating assets $ (4 ) $ (17 ) Other (1 ) (1 ) Total expense/(income) $ (5 ) $ (18 ) Net Gain from Sale of Operating Assets During the first quarter of 2018, we completed the sale of our Milwaukee, Wisconsin distribution facility for a net sale price of $30 million and recognized a net gain of $12 million . |
Income Taxes
Income Taxes | 3 Months Ended |
May 04, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The net tax expense of $1 million for the three months ended May 4, 2019 consisted of federal, state and foreign tax expenses of $2 million , $1 million of expense related to the deferred tax asset change arising from the tax amortization of indefinite-lived intangible assets and a $2 million benefit due to the release of valuation allowance. As of May 4, 2019 , we have approximately $2.2 billion of net operating losses (NOLs) available for U.S. federal income tax purposes, which largely expire in 2032 through 2034; $274 million of federal unused interest deductions that do not expire; and $69 million of tax credit carryforwards that expire at various dates through 2037. Additionally, we have state NOLs that are subject to various limitations and expiration dates beginning in 2019 through 2040 and are offset fully by valuation allowances. A valuation allowance of $576 million fully offsets the federal deferred tax assets resulting from the NOL, unused interest deductions and tax credit carryforwards that expire at various dates through 2037. A valuation allowance of $249 million fully offsets the deferred tax assets resulting from the state NOL carryforwards that expire at various dates through 2037. In assessing the need for the valuation allowance, we considered both positive and negative evidence related to the likelihood of realization of the deferred tax assets. As a result of our periodic assessment, our estimate of the realization of deferred tax assets is solely based on the future reversals of existing taxable temporary differences and tax planning strategies that we would make use of to accelerate taxable income to utilize expiring NOL and tax credit carryforwards. Accordingly, in the three months ended May 4, 2019 , the valuation allowance net increase of $23 million consisted of $35 million to offset the net deferred tax assets created in the quarter primarily due to the increase in NOL carryforwards, $3 million which offsets the tax benefit attributable to the loss recorded in Other comprehensive income/(loss), offset by a $15 million benefit related to lease accounting. |
Litigation, Other Contingencies
Litigation, Other Contingencies and Guarantees | 3 Months Ended |
May 04, 2019 | |
Litigation, Other Contingencies and Guarantees [Abstract] | |
Litigation, Other Contingencies and Guarantees | Litigation and Other Contingencies Litigation Shareholder Derivative Litigation On October 19, 2018, a shareholder of the Company, Juan Rojas, filed a shareholder derivative action against certain present and former members of the Company’s Board of Directors in the Delaware Court of Chancery. The Company is named as a nominal defendant. The lawsuit asserts claims for breaches of fiduciary duties based on alleged failures to prevent the Company from engaging in allegedly unlawful promotional pricing practices. While no assurance can be given as to the ultimate outcome of this matter, we believe that the final resolution of this action will not have a material adverse effect on our results of operations, financial position, liquidity or capital resources. Other Legal Proceedings We are subject to various other legal and governmental proceedings involving routine litigation incidental to our business. Accruals have been established based on our best estimates of our potential liability in certain of these matters, which we believe aggregate to an amount that is not material to the Consolidated Financial Statements. These estimates were developed in consultation with in-house and outside counsel. While no assurance can be given as to the ultimate outcome of these matters, we currently believe that the final resolution of these actions, individually or in the aggregate, will not have a material adverse effect on our results of operations, financial position, liquidity or capital resources. Contingencies As of May 4, 2019 , we have an estimated accrual of $19 million related to potential environmental liabilities that is recorded in Other accounts payable and accrued expenses and Other liabilities in the unaudited Interim Consolidated Balance Sheet. This estimate covered potential liabilities primarily related to underground storage tanks and remediation of environmental conditions involving our former drugstore locations. 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 estimated amount, we do not believe that such losses would have a material effect on our financial condition, results of operations, liquidity or capital resources. |
Basis of Presentation and Con_2
Basis of Presentation and Consolidation (Policy) | 3 Months Ended |
May 04, 2019 | |
Basis of Presentation and Consolidation [Abstract] | |
Consolidation, Policy | 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 holding company has no independent assets or operations, and no direct subsidiaries other than JCP. The holding company and its consolidated subsidiaries, including JCP, are collectively referred to in this quarterly report as “we,” “us,” “our,” “ourselves” or the “Company,” unless otherwise indicated. J. C. Penney Company, Inc. is a co-obligor (or guarantor, as appropriate) regarding the payment of principal and interest on JCP’s outstanding debt securities. The guarantee of certain of JCP’s outstanding debt securities by J. C. Penney Company, Inc. is full and unconditional. These unaudited Interim Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and in accordance with the rules and regulations of the Securities and Exchange Commission (SEC). The accompanying unaudited Interim Consolidated Financial Statements, in our opinion, include all material adjustments necessary for a fair presentation and should be read in conjunction with the audited Consolidated Financial Statements and notes thereto in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019 ( 2018 Form 10-K). We follow the same accounting policies to prepare quarterly financial statements as are followed in preparing annual financial statements. A description of such significant accounting policies is included in the 2018 Form 10-K. The February 2, 2019 financial information was derived from the audited Consolidated Financial Statements, with related footnotes, included in the 2018 Form 10-K. Because of the seasonal nature of the retail business, operating results for interim periods are not necessarily indicative of the results that may be expected for the full year. |
Fiscal Period, Policy | Our fiscal year ends on the Saturday closest to January 31. As used herein, “three months ended May 4, 2019 ” and “ first quarter of 2019 ” refer to the 13-week period ended May 4, 2019 , and “three months ended May 5, 2018 ” and “ first quarter of 2018 ” refer to the 13-week period ended May 5, 2018 . Fiscal years 2019 and 2018 contain 52 weeks. |
Reclassification, Policy | Certain reclassifications were made to prior period amounts to conform to the current period presentation. |
Leases (Policies)
Leases (Policies) | 3 Months Ended |
May 04, 2019 | |
Lease Accounting Policy Applied in 2019 [Abstract] | |
Lessee, Leases [Policy Text Block] | Accounting Policy Applied in Fiscal 2019 At the lease commencement date, based on certain criteria, we determine if a lease is classified as an operating lease or finance lease and then recognize a right-of-use asset and a lease liability on the Consolidated Balance Sheets for all leases (with the exception of leases that have a term of twelve months or less). The lease liability is measured as the present value of unpaid lease payments measured based on the reasonably certain lease term and corresponding discount rate. The initial right-of-use asset is measured as the lease liability plus certain other costs and is reduced by any tenant allowances collected from the lessor. Lease payments include fixed and in-substance fixed payments, variable payments based on an index or rate and termination penalties. Lease payments do not include variable lease payments other than those that depend on an index or rate or any payments not considered part of the lease (i.e. payment of the lessor’s real estate taxes and insurance). Payments not considered lease payments are expensed as incurred. Some leases require additional payments based on sales and the related contingent rent is recorded as rent expense when the payment is probable. As a policy election, we consider lease payments and all related other payments as one component of a lease. The reasonably certain lease term includes the non-cancelable lease term and any renewal option periods where we have economically compelling reasons for future exercise. The discount rate used in our present value calculations is the rate implicit in the lease, when known, or our estimated incremental borrowing rate. Our incremental borrowing rate is estimated based on our secured borrowings and our credit risk relative to the time horizons of other publicly available data points that are consistent with the respective lease term. Whether an operating lease or a finance lease, the lease liability is amortized over the lease term at a constant periodic interest rate. The right-of-use assets related to operating leases are amortized over the lease term on a basis that renders a straight-line amount of rent expense which encompasses the amortization and interest component of the lease. With the occurrence of certain events, the amortization pattern for an operating asset is adjusted to a straight-line basis over the remaining lease term. The right-of-use asset related to a finance lease is amortized on a straight-line basis over the lease term. Rent on short-term leases are expensed on a straight-line basis over the lease term. When a lease is modified or there is a change in lease term, we assess for any change in lease classification and remeasure the lease liability with a corresponding increase or decrease to the right-of-use asset. Sale-leasebacks are transactions through which we sell assets and subsequently lease them back. The resulting leases that qualify for sale-leaseback accounting are evaluated and accounted for as an operating lease. A transaction that does not qualify for sale-leaseback accounting as a result of finance lease classification or the failure to meet certain revenue recognition criteria is accounted for as a financing transaction. For a financing transaction, we retain the "sold" assets within property and equipment and record a financing obligation equal to the amount of cash proceeds received. Rental payments under such transactions are recognized as a reduction of the financing obligation and as interest expense using an effective interest method. |
Adoption of New Accounting St_2
Adoption of New Accounting Standards Balance Sheet Impact of Applying the New Lease Standard (Tables) | 3 Months Ended |
May 04, 2019 | |
Balance Sheet Impact of Applying the New Lease Accounting Standard [Abstract] | |
Schedule of Balance Sheet Impact of Applying the New Lease Standard [Table Text Block] | The following table provides the overall unaudited Interim Consolidated Balance Sheet impact of applying the new lease standard effective as of February 3, 2019. Due to the change in accounting for the Home Office sale-leaseback, there was a change in classification of $5 million in lease costs from Depreciation and amortization and Net interest expense in the prior year period to Selling, general and administrative expenses in the current year period. There was no significant impact to the Company's unaudited Interim Consolidated Statement of Cash Flows. Balance as of February 3, 2019 ($ in millions) Balances removed under prior accounting Balances added/reclassified under new lease standard Net impact of new lease standard Prepaid expenses and other $ — $ (5 ) $ (5 ) Property and equipment 153 — (153 ) Operating lease assets — 910 910 Other assets — (7 ) (7 ) Total assets $ 153 $ 898 $ 745 Other accounts payable and accrued expenses $ 4 $ — $ (4 ) Current operating lease liabilities — 85 85 Current portion of finance leases and note payable 5 — (5 ) Noncurrent operating lease liabilities — 1,074 1,074 Long-term finance leases and note payable 203 — (203 ) Deferred taxes 10 — (10 ) Other liabilities 11 (208 ) (219 ) Reinvested earnings/(accumulated deficit) 80 (53 ) 27 Total liabilities and stockholders’ equity $ 153 $ 898 $ 745 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
May 04, 2019 | |
Leases [Abstract] | |
Lease Assets and Liabilities [Table Text Block] | Leases ($ in millions) Classification May 4, 2019 Assets Operating lease assets Operating lease assets $ 917 Finance lease assets Property and equipment 1 Total leased assets $ 918 Liabilities Current Operating Current operating lease liabilities $ 84 Finance Current portion of finance leases and note payable 1 Noncurrent Operating Noncurrent operating lease liabilities 1,082 Finance Long-term finance leases and note payable 1 Total leased liabilities $ 1,168 |
Lease, Cost [Table Text Block] | Lease Cost Three Months Ended ($ in millions) Classification May 4, 2019 Operating lease cost Selling, general and administrative expense (SG&A) $ 48 Variable lease cost Selling, general and administrative expense (SG&A) 32 Finance lease cost Amortization of leased assets Depreciation and amortization — Interest on lease liabilities Net interest expense — Rental income Real estate and other, net 2 Net lease cost $ 78 |
Lessee, Operating Lease, Liability, Maturity [Table Text Block] | As of May 4, 2019 , future lease payments were as follows: ($ in millions) Operating Leases Finance Leases Total 2019 $ 156 $ 1 $ 157 2020 195 1 196 2021 187 — 187 2022 173 — 173 2023 166 — 166 Thereafter 1,816 2 1,818 Total lease payments 2,693 4 2,697 Less: amounts representing interest (1,527 ) (2 ) (1,529 ) Present value of lease liabilities $ 1,166 $ 2 $ 1,168 |
Other Information [Table Text Block] | Other information: Three Months Ended ($ in millions) May 4, Cash paid for amounts included in the measurement of these liabilities Operating cash flows from operating leases 51 Operating cash flows from finance leases 1 Financing cash flows from finance leases 1 |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | As determined prior to the adoption of the new lease standard, the future minimum lease payments under operating leases in effect as of February 2, 2019 were as follows: ($ in millions) 2019 $ 190 2020 178 2021 163 2022 148 2023 135 Thereafter 1,626 Less: sublease income (43 ) Total minimum lease payments $ 2,397 |
Leases Lease Term and Discount
Leases Lease Term and Discount Rate (Tables) | 3 Months Ended |
May 04, 2019 | |
Lease Term and Discount Rate [Abstract] | |
Lessee weighted average Lease Term and Discount Rate [Table Text Block] | Lease term and discount rate are as follows: May 4, Weighted-average remaining lease term (years) Operating leases 16 Financing leases 1 Weighted-average discount rate Operating leases 11 % Financing leases 6 % |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
May 04, 2019 | |
Disaggregation of Revenue [Line Items] | |
Disaggregation of Revenue [Table Text Block] | The following table provides the components of Net sales for the three months ended May 4, 2019 and May 5, 2018 : Three Months Ended ($ in millions) May 4, 2019 May 5, 2018 Women’s apparel $ 590 24 % $ 614 24 % Men’s apparel and accessories 478 20 % 500 19 % Women’s accessories, including Sephora 349 14 % 378 15 % Home 305 13 % 354 14 % Children’s, including toys 200 8 % 207 8 % Footwear 181 7 % 189 7 % Jewelry 167 7 % 162 6 % Services and other 169 7 % 180 7 % Total net sales $ 2,439 100 % $ 2,584 100 % |
Revenue Contract with Customer
Revenue Contract with Customer Liability (Tables) | 3 Months Ended |
May 04, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Contract with Customer, Liability [Table Text Block] | The Company has contract liabilities associated with the sales of gift cards and our customer loyalty program. The liabilities are included in Other accounts payable and accrued expenses in the unaudited Interim Consolidated Balance Sheets and were as follows: (in millions) May 4, 2019 May 5, 2018 February 2, 2019 Gift cards $ 121 $ 124 $ 140 Loyalty rewards 61 71 60 Total contract liability $ 182 $ 195 $ 200 |
Change in Contract with Customer, Liability Rollforward [Table Text Block] | Contract liability includes consideration received for gift card and loyalty related performance obligations which have not been satisfied as of a given date. A rollforward of the amounts included in contract liability for the first three months of 2019 and 2018 are as follows: (in millions) 2019 2018 Beginning balance $ 200 $ 217 Current period gift cards sold and loyalty reward points earned 78 74 Net sales from amounts included in contract liability opening balances (36 ) (38 ) Net sales from current period usage (60 ) (58 ) Ending balance $ 182 $ 195 |
Earnings_(Loss) per Share (Tabl
Earnings/(Loss) per Share (Tables) | 3 Months Ended |
May 04, 2019 | |
Earnings Per Share [Abstract] | |
Earnings/(Loss) per Share | Net income/(loss) and shares used to compute basic and diluted earnings/(loss) per share (EPS) are reconciled below: Three Months Ended (in millions, except per share data) May 4, May 5, Earnings/(loss) Net income/(loss) $ (154 ) $ (78 ) Shares Weighted average common shares outstanding (basic shares) 317.7 313.9 Adjustment for assumed dilution: Stock options, restricted stock awards and warrant — — Weighted average shares assuming dilution (diluted shares) 317.7 313.9 EPS Basic $ (0.48 ) $ (0.25 ) Diluted $ (0.48 ) $ (0.25 ) |
Antidilutive common stock | The following average potential shares of common stock were excluded from the diluted EPS calculation because their effect would have been anti-dilutive: Three Months Ended (Shares in millions) May 4, May 5, Stock options, restricted stock awards and warrant 22.5 29.3 |
Long-Term Debt Long-Term Debt (
Long-Term Debt Long-Term Debt (Tables) | 3 Months Ended |
May 04, 2019 | |
Debt Instrument [Line Items] | |
Schedule of Debt [Table Text Block] | ($ in millions) May 4, 2019 May 5, 2018 February 2, 2019 Issue: 8.125% Senior Notes Due 2019 $ 50 $ 50 $ 50 5.65% Senior Notes Due 2020 (1) 110 110 110 2017 Credit Facility (Matures in 2022) 118 351 — 2016 Term Loan Facility (Matures in 2023) 1,572 1,614 1,583 5.875% Senior Secured Notes Due 2023 (1) 500 500 500 7.125% Debentures Due 2023 10 10 10 8.625% Senior Secured Second Priority Notes Due 2025 (1) 400 400 400 6.9% Notes Due 2026 2 2 2 6.375% Senior Notes Due 2036 (1) 388 388 388 7.4% Debentures Due 2037 313 313 313 7.625% Notes Due 2097 500 500 500 Total debt 3,963 4,238 3,856 Unamortized debt issuance costs (45 ) (54 ) (48 ) Less: current maturities (92 ) (42 ) (92 ) Total long-term debt $ 3,826 $ 4,142 $ 3,716 (1) These debt issuances contain a change of control provision that would obligate us, at the holders’ option, to repurchase the debt at a price of 101%. |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
May 04, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Liabilities at Fair Value [Table Text Block] | Information regarding the gross amounts of our derivative instruments in the unaudited Interim Consolidated Balance Sheets is as follows: Asset Derivatives at Fair Value Liability Derivatives at Fair Value ($ in millions) Balance Sheet Location May 4, 2019 May 5, 2018 February 2, 2019 Balance Sheet Location May 4, 2019 May 5, 2018 February 2, 2019 Derivatives designated as hedging instruments: Interest rate swaps Prepaid expenses and other $ 1 $ — $ — Other accounts payable and accrued expenses $ — $ — $ — Interest rate swaps Other assets 6 16 10 Other liabilities 25 — 15 Total derivatives designated as hedging instruments $ 7 $ 16 $ 10 $ 25 $ — $ 15 |
Restructuring and Management _2
Restructuring and Management Transition Charges (Tables) | 3 Months Ended |
May 04, 2019 | |
Restructuring Reserve [Abstract] | |
Composition of Restructuring and Management Transition Charges | The composition of Restructuring and management transition charges was as follows: Three Months Ended Cumulative Amount From Program Inception Through May 4, 2019 ($ in millions) May 4, May 5, Home office and stores $ 19 $ 7 $ 505 Management transition 1 — 265 Other — — 186 Total $ 20 $ 7 $ 956 |
Restructuring and Management Transition Charges | Activity for the Restructuring and management transition liability for the three months ended May 4, 2019 was as follows: ($ in millions) Home Office and Stores Other Total February 2, 2019 $ 16 $ 2 $ 18 ASC 842 (Leases) adoption (See Note 2) (15 ) — (15 ) Charges 6 1 7 Cash payments (2 ) (3 ) (5 ) May 4, 2019 $ 5 $ — $ 5 |
Fair Value Disclosures (Tables)
Fair Value Disclosures (Tables) | 3 Months Ended |
May 04, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Financial Instruments Not Carried at Fair Value, Carrying Value and Fair Value | Carrying values and fair values of financial instruments that are not carried at fair value in the unaudited Interim Consolidated Balance Sheets are as follows: May 4, 2019 May 5, 2018 February 2, 2019 ($ in millions) Carrying Amount Fair Value Carrying Amount Fair Value Carrying Amount Fair Value Total debt, excluding unamortized debt issuance costs, finance leases and note payable $ 3,963 $ 2,833 $ 4,238 $ 3,712 $ 3,856 $ 2,579 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
May 04, 2019 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Changes in Accumulated Other Comprehensive Income (Loss) | The following tables show the changes in accumulated other comprehensive income/(loss) balances for the three months ended May 4, 2019 and the three months ended May 5, 2018 : ($ in millions) Net Actuarial Gain/(Loss) Prior Service Credit/(Cost) Foreign Currency Translation Gain/(Loss) on Cash Flow Hedges Accumulated Other Income/(Loss) February 2, 2019 $ (290 ) $ (22 ) $ (1 ) $ (15 ) $ (328 ) ASU 2018-02 (Stranded Taxes) adoption (See Note 2) 46 3 — 4 53 Other comprehensive income/(loss) before reclassifications — — — (11 ) (11 ) Amounts reclassified from accumulated other comprehensive income — 2 — (2 ) — May 4, 2019 $ (244 ) $ (17 ) $ (1 ) $ (24 ) $ (286 ) ($ in millions) Net Actuarial Prior Service Foreign Currency Translation Gain/(Loss) on Cash Flow Hedges Accumulated February 3, 2018 $ (330 ) $ (26 ) $ — $ (4 ) $ (360 ) Other comprehensive income/(loss) before reclassifications — — — 5 5 Amounts reclassified from accumulated other comprehensive income — 1 — — 1 May 5, 2018 $ (330 ) $ (25 ) $ — $ 1 $ (354 ) |
Retirement Benefit Plans (Table
Retirement Benefit Plans (Tables) | 3 Months Ended |
May 04, 2019 | |
Retirement Benefit Plans [Abstract] | |
Schedule of Pension Plan Expense/(Income) | The components of net periodic pension expense/(income) for our non-contributory qualified defined benefit pension plan and supplemental pension plans were as follows: Three Months Ended ($ in millions) May 4, May 5, Service cost $ 7 $ 9 Other components of net periodic pension cost/(income): Interest cost 33 35 Expected return on plan assets (48 ) (56 ) Amortization of prior service cost/(credit) 2 2 (13 ) (19 ) Net periodic pension expense/(income) $ (6 ) $ (10 ) |
Real Estate and Other, Net Real
Real Estate and Other, Net Real Estate and Other, Net (Tables) | 3 Months Ended |
May 04, 2019 | |
Real Estate and Other, Net [Abstract] | |
Schedule of Other Operating Cost and Expense, by Component [Table Text Block] | The composition of Real estate and other, net was as follows: Three Months Ended ($ in millions) May 4, May 5, Net gain from sale of operating assets $ (4 ) $ (17 ) Other (1 ) (1 ) Total expense/(income) $ (5 ) $ (18 ) |
Basis of Presentation and Con_3
Basis of Presentation and Consolidation (Nature of Operations) (Details) | 3 Months Ended |
May 04, 2019 | |
Entity Information [Line Items] | |
State of incorporation | Delaware |
J. C. Penney Corporation, Inc. [Member] | |
Entity Information [Line Items] | |
Year Incorporated | 1924 |
J. C. Penney Company, Inc. [Member] | |
Entity Information [Line Items] | |
Year Incorporated | 2002 |
Adoption of New Accounting St_3
Adoption of New Accounting Standards (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | Feb. 03, 2019 | |
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | $ 208 | |
Recognized gain in Reinvested earnings failed sale lease-back valid under new lease accounting | 55 | |
Revaluated $50 million promissory note issued in connection with sale of home office | 50 | |
Did not recognize any amount for the $50 million promissory note | 50 | |
Impairment charge to Reinvested earnings/(accumulated deficit) | 40 | |
Change in classification in lease costs | $ 5 | |
Total assets [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 153 | |
Net impact of new lease accounting standard | 745 | |
Balances added/reclassified under new lease standard | (898) | |
Prepaid Expenses and Other Current Assets [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 0 | |
Net impact of new lease accounting standard | (5) | |
Balances added/reclassified under new lease standard | 5 | |
Property and equipment [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 153 | |
Net impact of new lease accounting standard | (153) | |
Balances added/reclassified under new lease standard | 0 | |
Operating lease assets [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 0 | |
Net impact of new lease accounting standard | 910 | |
Balances added/reclassified under new lease standard | (910) | |
Other Assets [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 0 | |
Net impact of new lease accounting standard | (7) | |
Balances added/reclassified under new lease standard | 7 | |
Other Accounts Payable and Accrued Expenses [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 4 | |
Net impact of new lease accounting standard | (4) | |
Balances added/reclassified under new lease standard | 0 | |
Current operating lease liabilities [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 0 | |
Net impact of new lease accounting standard | 85 | |
Balances added/reclassified under new lease standard | (85) | |
Current portion of finance leases and note payable [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 5 | |
Net impact of new lease accounting standard | (5) | |
Balances added/reclassified under new lease standard | 0 | |
Noncurrent operating lease liabilities [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 0 | |
Net impact of new lease accounting standard | 1,074 | |
Balances added/reclassified under new lease standard | (1,074) | |
Long-term finance leases and note payable [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 203 | |
Net impact of new lease accounting standard | (203) | |
Balances added/reclassified under new lease standard | 0 | |
Deferred Taxes [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 10 | |
Net impact of new lease accounting standard | (10) | |
Balances added/reclassified under new lease standard | 0 | |
Other Liabilities [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 11 | |
Net impact of new lease accounting standard | (219) | |
Balances added/reclassified under new lease standard | 208 | |
Reinvested Earnings/(Accumulated Deficit) [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 80 | |
Net impact of new lease accounting standard | 27 | |
Balances added/reclassified under new lease standard | 53 | |
Total liabilities and stockholders' equity [Member] | ||
Balance sheet impact [Line Items] | ||
Balances removed under prior accounting | 153 | |
Net impact of new lease accounting standard | 745 | |
Balances added/reclassified under new lease standard | $ (898) |
Effect of New Accounting Stan_2
Effect of New Accounting Standards (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Net income/(loss) | $ (154) | $ (78) |
Accounting Standards Update 2018-02 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
New accounting pronouncement or change in accounting principle, description | On August 28, 2018, the FASB issued ASU 2018-13, Fair Value Measurement. This standard is effective for public business entities in fiscal years beginning after December 15, 2019, and for interim periods within those years. Early adoption is permitted, including during an interim period. This new standard requires changes to the disclosure requirements for fair value measurements for certain Level 3 items, and specifies that some of the changes must be applied prospectively, while others should be applied retrospectively. The Company is evaluating this new standard, but does not expect it to have a significant impact on its financial statement disclosures. |
Leases (Details)
Leases (Details) - USD ($) | 3 Months Ended | |||
May 04, 2019 | Feb. 03, 2019 | Feb. 02, 2019 | May 05, 2018 | |
Lease Cost [Line Items] | ||||
Balances removed under prior accounting | $ 208,000,000 | |||
Operating Lease, Payments | $ 51 | |||
Operating cash flows from finance leases | 1 | |||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | $ 190,000,000 | |||
Operating lease assets | 917,000,000 | 0 | $ 0 | |
Total leased assets | 918,000,000 | |||
Lease, Cost | 78,000,000 | |||
Current operating lease liabilities | 84,000,000 | 0 | 0 | |
Operating Lease, Liability, Noncurrent | 1,082,000,000 | 0 | $ 0 | |
Operating Leases, Future Minimum Payments, Due in Two Years | 178,000,000 | |||
Operating Leases, Future Minimum Payments, Due in Three Years | 163,000,000 | |||
Operating Leases, Future Minimum Payments, Due in Four Years | 148,000,000 | |||
Operating Leases, Future Minimum Payments, Due in Five Years | 135,000,000 | |||
Operating Leases, Future Minimum Payments Due | 2,397,000,000 | |||
Total leased liabilities | 1,168,000,000 | |||
Finance Lease, Principal Payments | 1,000,000 | |||
Operating Lease, Liability | 1,166,000,000 | |||
Finance Lease, Liability | 2,000,000 | |||
Operating Leases, Future Minimum Payments, Due Thereafter | 1,626,000,000 | |||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | 156,000,000 | |||
Finance Lease, Liability, Payments, Due Next Twelve Months | 1,000,000 | |||
Total lease liability year one | 157,000,000 | |||
Operating Leases, Future Minimum Payments, Due in Two Years | 195,000,000 | |||
Finance Lease, Liability, Payments, Due Year Two | 1,000,000 | |||
Total lease liability year two | 196,000,000 | |||
Operating Leases, Future Minimum Payments, Due in Three Years | 187,000,000 | |||
Finance Lease, Liability, Payments, Due Year Three | 0 | |||
Total lease liability year three | 187,000,000 | |||
Lessee, Operating Lease, Liability, Payments, Due Year Four | 173,000,000 | |||
Operating Leases, Future Minimum Payments, Due in Four Years | 166,000,000 | |||
Finance Lease, Liability, Payments, Due Year Four | 0 | |||
Total lease liability year four | 173,000,000 | |||
Finance Lease, Liability, Payments, Due Year Five | 0 | |||
Total lease liability year five | 166,000,000 | |||
Operating Leases, Future Minimum Payments, Due Thereafter | 1,816,000,000 | |||
Finance Lease, Liability, Payments, Due after Year Five | 2,000,000 | |||
Total lease liability thereafter | 1,818,000,000 | |||
Lessee, Operating Lease, Liability, Payments, Due | 2,693,000,000 | |||
Finance Lease, Liability, Payments, Due | 4,000,000 | |||
Total lease payments | 2,697,000,000 | |||
Operating Leases, Amounts Representing Interest | (1,527,000,000) | |||
Finance Leases, Amounts Representing Interest | 2,000,000 | |||
Total leases, amounts representing interest | (1,529,000,000) | |||
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals | $ (43,000,000) | |||
Selling, General and Administrative Expenses [Member] | ||||
Lease Cost [Line Items] | ||||
Operating Lease, Cost | 48,000,000 | |||
Variable Lease, Cost | 32,000,000 | |||
Real estate and other, net [Member] | ||||
Lease Cost [Line Items] | ||||
Sublease Income | 2,000,000 | |||
Operating lease assets [Member] | ||||
Lease Cost [Line Items] | ||||
Balances removed under prior accounting | 0 | |||
Balances added/reclassified under new lease standard | 910,000,000 | |||
Net impact of new lease accounting standard | 910,000,000 | |||
Operating lease assets | 917,000,000 | |||
Property and equipment [Member] | ||||
Lease Cost [Line Items] | ||||
Balances removed under prior accounting | 153,000,000 | |||
Balances added/reclassified under new lease standard | 0 | |||
Net impact of new lease accounting standard | (153,000,000) | |||
Finance lease assets | 1,000,000 | |||
Total assets [Member] | ||||
Lease Cost [Line Items] | ||||
Balances removed under prior accounting | 153,000,000 | |||
Balances added/reclassified under new lease standard | 898,000,000 | |||
Net impact of new lease accounting standard | 745,000,000 | |||
Current operating lease liabilities [Member] | ||||
Lease Cost [Line Items] | ||||
Balances removed under prior accounting | 0 | |||
Balances added/reclassified under new lease standard | 85,000,000 | |||
Net impact of new lease accounting standard | 85,000,000 | |||
Current operating lease liabilities | 84,000,000 | |||
Current portion of finance leases and note payable [Member] | ||||
Lease Cost [Line Items] | ||||
Balances removed under prior accounting | 5,000,000 | |||
Balances added/reclassified under new lease standard | 0 | |||
Net impact of new lease accounting standard | (5,000,000) | |||
Finance lease liabilities, current | 1,000,000 | |||
Noncurrent operating lease liabilities [Member] | ||||
Lease Cost [Line Items] | ||||
Balances removed under prior accounting | 0 | |||
Balances added/reclassified under new lease standard | 1,074,000,000 | |||
Net impact of new lease accounting standard | 1,074,000,000 | |||
Operating Lease, Liability, Noncurrent | 1,082,000,000 | |||
Long-term finance leases and note payable [Member] | ||||
Lease Cost [Line Items] | ||||
Balances removed under prior accounting | 203,000,000 | |||
Balances added/reclassified under new lease standard | 0 | |||
Net impact of new lease accounting standard | (203,000,000) | |||
Finance lease liabilities, noncurrent | $ 1,000,000 | |||
Deferred Taxes [Member] | ||||
Lease Cost [Line Items] | ||||
Balances removed under prior accounting | 10,000,000 | |||
Balances added/reclassified under new lease standard | 0 | |||
Net impact of new lease accounting standard | (10,000,000) | |||
Total liabilities and stockholders' equity [Member] | ||||
Lease Cost [Line Items] | ||||
Balances removed under prior accounting | 153,000,000 | |||
Balances added/reclassified under new lease standard | 898,000,000 | |||
Net impact of new lease accounting standard | $ 745,000,000 |
Leases Lease Term and Discoun_2
Leases Lease Term and Discount Rate (Details) $ in Millions | May 04, 2019USD ($)Rate |
Lease Term and Discount Rate [Abstract] | |
Total leased liabilities | $ | $ 1,168 |
Total leased assets | $ | $ 918 |
Operating Lease, Weighted Average Remaining Lease Term | 16 years |
Finance Lease, Weighted Average Remaining Lease Term | 1 year |
Operating Lease, Weighted Average Discount Rate, Percent | Rate | 11.00% |
Lessee, Finance Lease, Discount Rate | Rate | 6.00% |
Revenue (Details)
Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Total net sales | $ 2,439 | $ 2,584 |
Women's apparel [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Percent of Total Net Sales | 24.00% | 24.00% |
Total net sales | $ 590 | $ 614 |
Men's apparel and accessories [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Percent of Total Net Sales | 20.00% | 19.00% |
Total net sales | $ 478 | $ 500 |
Home [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Percent of Total Net Sales | 13.00% | 14.00% |
Total net sales | $ 305 | $ 354 |
Women's accessories, including Sephora [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Percent of Total Net Sales | 14.00% | 15.00% |
Total net sales | $ 349 | $ 378 |
Children's, including toys [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Percent of Total Net Sales | 8.00% | 8.00% |
Total net sales | $ 200 | $ 207 |
Footwear and handbags [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Percent of Total Net Sales | 7.00% | 7.00% |
Total net sales | $ 181 | $ 189 |
Jewelry [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Percent of Total Net Sales | 7.00% | 6.00% |
Total net sales | $ 167 | $ 162 |
Services and other [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Percent of Total Net Sales | 7.00% | 7.00% |
Total net sales | $ 169 | $ 180 |
Total [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Percent of Total Net Sales | 100.00% | 100.00% |
Revenue Contract with Custome_2
Revenue Contract with Customer Liability (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Revenue from Contract with Customer [Abstract] | ||
Contract with Customer, Liability | $ 200 | $ 217 |
Contract with Customer Liability [Roll Forward] | ||
Beginning Balance | 200 | 217 |
Current Period Gift Cards Sold and Reward Points Earned | 78 | 74 |
Net Sales From Amounts Included in Contract Liability Opening Balances | (36) | (38) |
Net Sales from Current Period Usage | (60) | (58) |
Ending Balance | 182 | 195 |
Gift Cards [Member] | ||
Revenue from Contract with Customer [Abstract] | ||
Contract with Customer, Liability | 140 | 124 |
Contract with Customer Liability [Roll Forward] | ||
Beginning Balance | 140 | |
Ending Balance | 121 | 124 |
Loyalty Rewards [Member] | ||
Revenue from Contract with Customer [Abstract] | ||
Contract with Customer, Liability | 60 | 71 |
Contract with Customer Liability [Roll Forward] | ||
Beginning Balance | 60 | |
Ending Balance | 61 | 71 |
Total [Member] | ||
Revenue from Contract with Customer [Abstract] | ||
Contract with Customer, Liability | 200 | 195 |
Contract with Customer Liability [Roll Forward] | ||
Beginning Balance | 200 | |
Ending Balance | $ 182 | $ 195 |
Earnings_(Loss) per Share (Deta
Earnings/(Loss) per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Earnings Per Share [Abstract] | ||
Net income/(loss) | $ (154) | $ (78) |
Weighted average common shares outstanding (basic shares) | 317.7 | 313.9 |
Weighted average shares assuming dilution (diluted shares) | 317.7 | 313.9 |
Basic (in dollars per share) | $ (0.48) | $ (0.25) |
Diluted (in dollars per share) | $ (0.48) | $ (0.25) |
Stock options, restricted stock awards and warrant | 22.5 | 29.3 |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) $ in Millions | 3 Months Ended | |||
May 04, 2019 | May 05, 2018 | Feb. 02, 2019 | ||
Less: current maturities | $ (92) | $ (42) | $ (92) | |
Unamortized debt issuance costs | (45) | (54) | (48) | |
Total debt | 3,963 | 4,238 | 3,856 | |
Total long-term debt | 3,826 | 4,142 | 3,716 | |
(Gain)/loss on extinguishment of debt | 0 | 23 | ||
Premium on early retirement of debt | $ 0 | 20 | ||
Senior Notes 5.65% Due 2020 [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 5.65% | |||
Unsecured Long-term Debt, Noncurrent | [1] | $ 110 | 110 | 110 |
Senior Secured Notes Five Point Eight Seven Five Percent Due2023 [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 5.875% | |||
Secured Long-term Debt, Noncurrent | [1] | $ 500 | 500 | 500 |
Senior Notes 6.375% Due 2036 [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 6.375% | |||
Unsecured Long-term Debt, Noncurrent | [1] | $ 388 | 388 | 388 |
Notes 6.9% Due 2026 [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 6.90% | |||
Unsecured Long-term Debt, Noncurrent | $ 2 | 2 | 2 | |
Debentures 7.125% Due 2023 [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 7.125% | |||
Unsecured Long-term Debt, Noncurrent | $ 10 | 10 | 10 | |
Senior Secured Second Priority Notes 8.625% due 2025 [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 8.625% | |||
Secured Long-term Debt, Noncurrent | [1] | $ 400 | 400 | 400 |
Debentures 7.4% Due 2037 [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 7.40% | |||
Unsecured Long-term Debt, Noncurrent | $ 313 | 313 | 313 | |
Notes 7.625% Due 2097 [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 7.625% | |||
Unsecured Long-term Debt, Noncurrent | $ 500 | 500 | 500 | |
2017 Credit Facility [Member] | ||||
Secured Long-term Debt, Noncurrent | $ 118 | 351 | 0 | |
Senior Notes 8.125% due 2019 [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 8.125% | |||
Unsecured Long-term Debt, Noncurrent | $ 50 | 50 | 50 | |
2016 Term Loan Facility [Member] | ||||
Secured Long-term Debt, Noncurrent | 1,572 | 1,614 | 1,583 | |
Notes And Debentures Including Current Maturities [Member] | ||||
Total debt | $ 3,963 | $ 4,238 | $ 3,856 | |
[1] | These debt issuances contain a change of control provision that would obligate us, at the holders’ option, to repurchase the debt at a price of 101%. |
Derivative Financial Instrume_3
Derivative Financial Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | ||||
May 04, 2019 | Feb. 02, 2019 | Sep. 04, 2018 | May 05, 2018 | May 07, 2015 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Discussion of Objectives for Using Interest Rate Derivative Instruments | Fix a portion of our variable LIBOR-based interest payments | ||||
Interest Rate Cash Flow Hedge Liability at Fair Value | $ 25 | $ 15 | $ 0 | ||
Interest Rate Cash Flow Hedge Asset at Fair Value | $ 7 | 10 | 16 | ||
Derivative, Notional Amount | $ 750 | $ 1,250 | |||
Derivative, Average Fixed Interest Rate | 3.135% | 2.04% | |||
Description of Reclassification of Interest Rate Cash Flow Hedge Gain (Loss) | Amounts in Accumulated other comprehensive income/(loss) are reclassified into Net income/(loss) when the related interest payments affect earnings | ||||
Description of Location of Interest Rate Cash Flow Hedge Derivative on Balance Sheet | The fair value of our interest rate swaps are recorded on the unaudited Interim Consolidated Balance Sheets as an asset or a liability (see Note 10). | ||||
Description of Location of Gain (Loss) on Interest Rate Cash Flow Hedge Derivative in Financial Statements | The effective portion of the interest rate swaps' changes in fair values is reported in Accumulated other comprehensive income/(loss) (see Note 11), and the ineffective portion is reported in Net income/(loss). | ||||
Description of Interest Rate Derivative Activities | We are party to interest rate swap agreements with notional amounts totaling $1,250 million to fix a portion of our variable LIBOR-based interest payments. The interest rate swap agreements have a weighted-average fixed rate of 2.04%, mature on May 7, 2020 and have been designated as cash flow hedges. On September 4, 2018 we entered into additional forward interest rate swap agreements with notional amounts totaling $750 million to fix a portion of our variable LIBOR-based interest payments. The forward interest rate swap agreements have a weighted-average fixed rate of 3.135%, have an effective date from May 7, 2020 to May 7, 2025 and have been designated as cash flow hedges. | ||||
Effectiveness of interest rate swaps | 100.00% | ||||
Prepaid Expenses and Other Current Assets [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Interest Rate Cash Flow Hedge Asset at Fair Value | $ 1 | ||||
Other Liabilities [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Interest Rate Cash Flow Hedge Liability at Fair Value | 25 | 15 | 0 | ||
Other Accounts Payable and Accrued Expenses [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Interest Rate Cash Flow Hedge Liability at Fair Value | 0 | 0 | 0 | ||
Other Assets [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Interest Rate Cash Flow Hedge Asset at Fair Value | $ 6 | $ 10 | $ 16 |
Restructuring and Management _3
Restructuring and Management Transition Cumulative Charges (Details) $ in Millions | 3 Months Ended | |
May 04, 2019USD ($)stores | May 05, 2018USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||
Severance Costs | $ 1 | |
Number of stores announced closing | stores | 18 | |
Asset Impairment Charges | $ 14 | |
Home Office And Stores [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Charges | 19 | $ 7 |
Cumulative Amount | 505 | |
Management Transition [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Charges | 1 | 0 |
Cumulative Amount | 265 | |
Other Restructuring And Management Transition [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Charges | 0 | 0 |
Cumulative Amount | 186 | |
Total [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Charges | 20 | $ 7 |
Cumulative Amount | $ 956 |
Restructuring and Management _4
Restructuring and Management Transition Charges (Liability Activity) (Details) $ in Millions | 3 Months Ended | |
May 04, 2019USD ($)stores | May 05, 2018USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||
Number of ancillary stores finalized plans to close | stores | 9 | |
Home Office And Stores [Member] | ||
Restructuring Reserve [Roll Forward] | ||
February 2, 2019 | $ 16 | |
ASC 842 (Leases) adoption (See Note 2) | (15) | |
Charges | 19 | $ 7 |
Restructuring and Related Cost, Incurred Cost | 6 | |
Cash payments | (2) | |
May 4, 2019 | 5 | |
Management Transition [Member] | ||
Restructuring Reserve [Roll Forward] | ||
Charges | 1 | 0 |
Other Restructuring And Management Transition [Member] | ||
Restructuring Reserve [Roll Forward] | ||
February 2, 2019 | 2 | |
ASC 842 (Leases) adoption (See Note 2) | 0 | |
Charges | 0 | 0 |
Restructuring and Related Cost, Incurred Cost | 1 | |
Cash payments | (3) | |
May 4, 2019 | 0 | |
Total [Member] | ||
Restructuring Reserve [Roll Forward] | ||
February 2, 2019 | 18 | |
ASC 842 (Leases) adoption (See Note 2) | (15) | |
Charges | 20 | $ 7 |
Restructuring and Related Cost, Incurred Cost | 7 | |
Cash payments | (5) | |
May 4, 2019 | $ 5 |
Fair Value Disclosures (Other F
Fair Value Disclosures (Other Financial Instruments) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
May 04, 2019 | Feb. 02, 2019 | May 05, 2018 | |
Fair Value Disclosures [Abstract] | |||
Total debt, excluding unamortized debt issuance costs, capital leases, financing obligation and note payable, Fair Value | $ 2,833 | $ 2,579 | $ 3,712 |
Total debt, excluding unamortized debt issuance costs, capital leases, financing obligation and note payable, carrying amount | 3,963 | $ 3,856 | $ 4,238 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Carrying value of long-lived assets impaired, fair value disclosure | 22 | ||
Asset Impairment Charges | 14 | ||
Carrying value of right-of-use assets impaired, fair value disclosure | 58 | ||
Right-of-use assets, fair value disclosure | 19 | ||
Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 8 | ||
Restructuring and management transition [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Asset Impairment Charges | $ 14 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
February 2, 2019, shares | 316.1 | |
February 2, 2019 | $ 1,170 | $ 1,383 |
Net income/(loss) | (154) | (78) |
Other comprehensive income/(loss) | (11) | 6 |
Stock-based compensation and other | $ 2 | $ 4 |
May 4, 2019, shares | 316.8 | 314.3 |
May 4, 2019 | $ 1,034 | $ 1,315 |
Common Stock [Member] | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
February 2, 2019, shares | 316.1 | 312 |
February 2, 2019 | $ 158 | $ 156 |
Stock-based compensation, shares | 0.7 | 2.3 |
Stock-based compensation and other | $ 0 | $ 1 |
May 4, 2019, shares | 316.8 | 314.3 |
May 4, 2019 | $ 158 | $ 157 |
Additional Paid-in Capital [Member] | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
February 2, 2019 | 4,713 | 4,705 |
Stock-based compensation and other | 2 | 3 |
May 4, 2019 | 4,715 | 4,708 |
Reinvested Earnings/(Accumulated Deficit) [Member] | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
February 2, 2019 | (3,373) | (3,118) |
Net income/(loss) | (154) | (78) |
May 4, 2019 | (3,553) | (3,196) |
Accumulated Other Comprehensive Income/(Loss) [Member] | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
February 2, 2019 | (328) | (360) |
Other comprehensive income/(loss) | (11) | 6 |
May 4, 2019 | $ (286) | $ (354) |
Stockholders' Equity (Component
Stockholders' Equity (Components of Other Comprehensive Income/ (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Stockholders' Equity Note [Abstract] | ||
Total, net of tax | $ (11) | $ 6 |
Stockholders' Equity (Accumulat
Stockholders' Equity (Accumulated Other Comprehensive Income/ (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Schedule of Capitalization, Equity [Line Items] | ||
ASC 842 (Leases) and ASU 2018-02 (Stranded Taxes) adoption (See Note 2) | $ 27 | |
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
February 2, 2019 | (328) | |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss) Arising During Period, Net of Tax | 0 | $ 0 |
Amounts reclassified from accumulated other comprehensive income, Prior Service Credit/(Cost), net of tax | (2) | (1) |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax | (2) | 0 |
Net current-period other comprehensive income | (11) | 6 |
May 4, 2019 | (286) | (354) |
Net Actuarial Gain/(Loss) [Member] | ||
Schedule of Capitalization, Equity [Line Items] | ||
ASC 842 (Leases) and ASU 2018-02 (Stranded Taxes) adoption (See Note 2) | 46 | |
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
February 2, 2019 | (290) | (330) |
Other comprehensive income (loss) before reclassifications, gain (loss) on cash flow hedges, net of tax | 0 | 0 |
Reclassification for net actuarial (gain)/loss (x) | 0 | 0 |
May 4, 2019 | (244) | (330) |
Prior Service Credit/(Cost) [Member] | ||
Schedule of Capitalization, Equity [Line Items] | ||
ASC 842 (Leases) and ASU 2018-02 (Stranded Taxes) adoption (See Note 2) | 3 | |
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
February 2, 2019 | (22) | (26) |
Other comprehensive income (loss) before reclassifications, gain (loss) on cash flow hedges, net of tax | 0 | 0 |
Amounts reclassified from accumulated other comprehensive income, Prior Service Credit/(Cost), net of tax | 2 | 1 |
May 4, 2019 | (17) | (25) |
Accumulated Translation Adjustment [Member] | ||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
February 2, 2019 | (1) | 0 |
May 4, 2019 | (1) | 0 |
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | ||
Schedule of Capitalization, Equity [Line Items] | ||
ASC 842 (Leases) and ASU 2018-02 (Stranded Taxes) adoption (See Note 2) | 4 | |
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
February 2, 2019 | (15) | (4) |
Other comprehensive income (loss) before reclassifications, gain (loss) on cash flow hedges, net of tax | (11) | 5 |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax | (2) | 0 |
May 4, 2019 | (24) | 1 |
Accumulated Other Comprehensive Income/(Loss) [Member] | ||
Schedule of Capitalization, Equity [Line Items] | ||
ASC 842 (Leases) and ASU 2018-02 (Stranded Taxes) adoption (See Note 2) | 53 | |
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
February 2, 2019 | (328) | (360) |
Other comprehensive income (loss) before reclassifications, gain (loss) on cash flow hedges, net of tax | (11) | 5 |
Amounts reclassified from accumulated other comprehensive income, Accumulated Other Comprehensive Income/(Loss) | 0 | 1 |
Net current-period other comprehensive income | (11) | 6 |
May 4, 2019 | $ (286) | $ (354) |
Stockholders' Equity (Reclassif
Stockholders' Equity (Reclassifications Out of Accumulated Other Comprehensive Income/ (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||
Total, net of tax | $ (11) | $ 6 |
Retirement Benefit Plans (Net P
Retirement Benefit Plans (Net Periodic Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Service cost | $ 7 | $ 9 |
Interest cost | 33 | 35 |
Expected return on plan assets | (48) | (56) |
Amortization of prior service cost/(credit) | 2 | 2 |
Net periodic pension expense/(income) | (6) | (10) |
Other components of net periodic pension cost/(income) | $ (13) | $ (19) |
Real Estate and Other, Net (Det
Real Estate and Other, Net (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Net gain from sale of operating assets [Line Items] | ||
Real estate and other (income)/expense, net | $ (5) | $ (18) |
(Gain) Loss on Disposition of Property Plant Equipment | (4) | (17) |
Other Asset Impairment Charges | 14 | |
Net sale price of Milwaukee WI distribution facility | 30 | |
Net gain on sale of Milwaukee WI distribution facility | (12) | |
Other Cost and Expense, Operating | $ (1) | $ (1) |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 04, 2019 | May 05, 2018 | |
Income Tax Contingency [Line Items] | ||
Income tax expense/(benefit) | $ 1 | $ (1) |
Increase to tax valuation allowance for deferred tax assets | 23 | |
Valuation allowance increase due to increase in NOL carryforwards | 35 | |
Valuation allowance increase attributable to the loss in OCI | $ 3 | |
Valuation allowance, methodologies and assumptions | In assessing the need for the valuation allowance, we considered both positive and negative evidence related to the likelihood of realization of the deferred tax assets. As a result of our periodic assessment, our estimate of the realization of deferred tax assets is solely based on the future reversals of existing taxable temporary differences and tax planning strategies that we would make use of to accelerate taxable income to utilize expiring NOL and tax credit carryforwards. | |
Income tax benefit due to release of valuation allowance | $ 2 | |
Net operating loss carryforwards | 2,200 | |
Valuation allowance decrease due to lease accounting tax benefit | (15) | |
Federal, State And Foreign [Member] | ||
Income Tax Contingency [Line Items] | ||
State and foreign tax expenses | (2) | |
Amortization of certain indefinite lived intangible assets [Member] | ||
Income Tax Contingency [Line Items] | ||
State and foreign tax expenses | (1) | |
Federal [Member] | ||
Income Tax Contingency [Line Items] | ||
Federal unused interest deductions that do not expire subject to interest limitation | 274 | |
Tax credit carryforwards | 69 | |
Federal tax authority [Member] | ||
Income Tax Contingency [Line Items] | ||
Valuation allowance | 576 | |
State Tax Authority [Member] | ||
Income Tax Contingency [Line Items] | ||
Valuation allowance | $ 249 |
Litigation, Other Contingenci_2
Litigation, Other Contingencies and Guarantees (Narrative) (Details) $ in Millions | May 04, 2019USD ($) |
Loss Contingencies [Line Items] | |
Recorded Best Estimate Environmental Liabilities | $ 19 |