Old COPPER (CPPRQ) 10-K 30 Mar 10 2010 FY Annual report Financial data

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)
In Millions, except Per Share data	12 Months Ended Jan. 30, 2010	12 Months Ended Jan. 31, 2009	12 Months Ended Feb. 02, 2008
Total net sales	$17,556	$18,486	$19,860
Cost of goods sold	10,646	11,571	12,189
Gross margin	6,910	6,915	7,671
Operating expenses:
Selling, general and administrative (SG&A)	5,382	5,395	5,402
Pension expense/(income)	337	(90)	(45)
Depreciation and amortization	495	469	426
Pre-opening	28	31	46
Real estate and other, net	5	(25)	(46)
Total operating expenses	6,247	5,780	5,783
Operating income	663	1,135	1,888
Net interest expense	260	225	153
Bond premiums and unamortized costs	0	0	12
Income from continuing operations before income taxes	403	910	1,723
Income tax expense	154	343	618
Income from continuing operations	249	567	1,105
Income from discontinued operations, net of income tax expense/(benefit) of $1, $(3) and $4	2	5	6
Net income	$251	$572	$1,111
Basic earnings per share:
Continuing operations	1.07	2.55	4.96
Discontinued operations	0.01	0.03	0.03
Net income	1.08	2.58	4.99
Diluted earnings per share:
Continuing operations	1.07	2.54	4.9
Discontinued operations	0.01	0.03	0.03
Net income	1.08	2.57	4.93

1_CONSOLIDATED STATEMENTS OF OP

CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) (USD $)
In Millions	12 Months Ended Jan. 30, 2010	12 Months Ended Jan. 31, 2009	12 Months Ended Feb. 02, 2008
Income tax expense/(benefit)-discontinued operations	$1	($3)	$4

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS (USD $)
In Millions	Jan. 30, 2010		Jan. 31, 2009
Current assets
Cash in banks and in transit	$163		$167
Cash short-term investments	2,848		2,185
Cash and cash equivalents	3,011		2,352
Merchandise inventory	3,024		3,259
Income taxes receivable	395		352
Prepaid expenses and other	222		257
Total current assets	6,652		6,220
Property and equipment, net	5,357		5,367
Other assets	572		424
Total Assets	12,581		12,011
Current liabilities
Merchandise accounts payable	1,226		1,194
Other accounts payable and accrued expenses	1,630		1,600
Current maturities of long-term debt	393		0
Total current liabilities	3,249		2,794
Long-term debt	2,999		3,505
Deferred taxes	817		599
Other liabilities	738		958
Total Liabilities	7,803		7,856
Stockholders' Equity
Common stock(1)	118	[1]	111	[1]
Additional paid-in capital	3,867		3,499
Reinvested earnings	2,023		1,959
Accumulated other comprehensive (loss)	(1,230)		(1,414)
Total Stockholders' Equity	4,778		4,155
Total Liabilities and Stockholders' Equity	$12,581		$12,011
[1]Common stock has a par value of $0.50 per share; 1,250 million shares are authorized. At January 30, 2010, 236 million shares were issued and outstanding. At January 31, 2009, 222 million shares were issued and outstanding.

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)
Share data in Millions, except Per Share data	Jan. 30, 2010	Jan. 31, 2009
Common stock, authorized	1,250	1,250
Common stock, par value per share	0.5	0.5
Common stock, issued and outstanding	236	222

CONSOLIDATED STATEMENTS OF STOC

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (USD $)
In Millions	Common Stock	Additional Paid-in Capital	Reinvested Earnings	Accumulated Other Comprehensive (Loss)/Income (AccumulatedOtherComprehensiveIncomeMember)	Comprehensive Income/(Loss)	Total
Beginning balance at Feb. 03, 2007	$112	$3,430	$922	($176)	$0	$4,288
Beginning balance (in shares) at Feb. 03, 2007	226
Adjustment to initially apply new tax accounting	0	0	5	0	0	5
Comprehensive income/(loss):
Net income	0	0	1,111	0	1,111	1,111
Unrealized gain/(loss) on investments, net of tax of $(27), $56 and $29 during 2009, 2008 and 2007, respectively	0	0	0	(51)	(51)	(51)
Net actuarial gain/(loss) and prior service credit adjustment, net of tax of $(85), $752 and $(278) during 2009, 2008 and 2007, respectively	0	0	0	435	435	435
Total comprehensive income/(loss)					1,495	1,495
Dividends declared, common ($0.80 per share)	0	0	(178)	0	0	(178)
Common stock repurchased and retired (in shares)	(5)
Common stock repurchased and retired	(2)	(78)	(320)	0	0	(400)
Stock-based compensation (in shares)	1
Stock-based compensation	1	101	0	0	0	102
Ending balance at Feb. 02, 2008	111	3,453	1,540	208	0	5,312
Ending balance (in shares) at Feb. 02, 2008	222
Opening balance measurement date adjustment, net of tax of $(16) and $218, respectively	0	0	26	(343)	0	(317)
Comprehensive income/(loss):
Net income	0	0	572	0	572	572
Unrealized gain/(loss) on investments, net of tax of $(27), $56 and $29 during 2009, 2008 and 2007, respectively	0	0	0	(100)	(100)	(100)
Net actuarial gain/(loss) and prior service credit adjustment, net of tax of $(85), $752 and $(278) during 2009, 2008 and 2007, respectively	0	0	0	(1,179)	(1,179)	(1,179)
Total comprehensive income/(loss)					(707)	(707)
Dividends declared, common ($0.80 per share)	0	0	(179)	0	0	(179)
Stock-based compensation	0	46	0	0	0	46
Ending balance at Jan. 31, 2009	111	3,499	1,959	(1,414)	0	4,155
Ending balance (in shares) at Jan. 31, 2009	222
Comprehensive income/(loss):
Net income	0	0	251	0	251	251
Unrealized gain/(loss) on investments, net of tax of $(27), $56 and $29 during 2009, 2008 and 2007, respectively	0	0	0	48	48	48
Net actuarial gain/(loss) and prior service credit adjustment, net of tax of $(85), $752 and $(278) during 2009, 2008 and 2007, respectively	0	0	0	136	136	136
Total comprehensive income/(loss)					435	435
Dividends declared, common ($0.80 per share)	0	0	(187)	0	0	(187)
Common stock contributed to primary pension plan (in shares)	13
Common stock contributed to primary pension plan	7	333	0	0	0	340
Stock-based compensation (in shares)	1
Stock-based compensation	0	35	0	0	0	35
Ending balance at Jan. 30, 2010	$118	$3,867	$2,023	($1,230)	$0	$4,778
Ending balance (in shares) at Jan. 30, 2010	236

2_CONSOLIDATED STATEMENTS OF ST

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) (USD $)
In Millions, except Per Share data	12 Months Ended Jan. 30, 2010	12 Months Ended Jan. 31, 2009	12 Months Ended Feb. 02, 2008
Tax on unrealized gain/(loss) on investments	($27)	$56	$29
Tax on net actuarial gain/(loss) and prior service credit adjustment	(85)	752	(278)
Dividends declared, common ($0.80 per share)	0.8	0.8	0.8
Tax on opening balance measurement date adjustment for reinvested earnings		(16)
Tax on opening balance measurement adjustment		$218

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Millions	12 Months Ended Jan. 30, 2010	12 Months Ended Jan. 31, 2009	12 Months Ended Feb. 02, 2008
Cash flows from operating activities:
Net income	$251	$572	$1,111
(Income) from discontinued operations	(2)	(5)	(6)
Adjustments to reconcile net income to net cash provided by operating activities:
Asset impairments and other charges	48	29	5
Depreciation and amortization	495	469	426
Net (gains) on sale of assets	(2)	(10)	(12)
Benefit plans expense/(income)	276	(201)	(155)
Stock-based compensation	40	47	45
Tax benefits from stock-based compensation	3	6	9
Deferred taxes	78	167	37
Change in cash from:
Inventory	235	382	(241)
Prepaid expenses and other assets	36	25	51
Merchandise accounts payable	32	(278)	106
Current income taxes payable	(57)	(36)	(66)
Accrued expenses and other	143	(12)	(61)
Net cash provided by operating activities of continuing operations	1,576	1,155	1,249
Cash flows from investing activities:
Capital expenditures	(600)	(969)	(1,243)
Proceeds from sale of assets	13	13	26
Net cash (used in) investing activities of continuing operations	(587)	(956)	(1,217)
Cash flows from financing activities:
Proceeds from issuance of long-term debt	0	0	980
Payments of long-term debt, including capital leases	(113)	(203)	(737)
Financing costs	(32)	0	(9)
Common stock repurchased	0	0	(400)
Dividends paid, common	(183)	(178)	(174)
Proceeds from stock options exercised	4	4	45
Excess tax benefits from stock-based compensation	0	1	17
Tax withholding payments reimbursed by restricted stock	(3)	(4)	(8)
Net cash (used in) financing activities of continuing operations	(327)	(380)	(286)
Cash flows from discontinued operations:
Operating cash flows	(2)	2	8
Investing cash flows	(1)	(1)	(25)
Financing cash flows	0	0	0
Total cash (paid)/received for discontinued operations	(3)	1	(17)
Net increase/(decrease) in cash and cash equivalents	659	(180)	(271)
Cash and cash equivalents at beginning of year	2,352	2,532	2,803
Cash and cash equivalents at end of year	$3,011	$2,352	$2,532

Nature of Operations and Summar

Nature of Operations and Summary of Significant Accounting Policies
	12 Months Ended Jan. 30, 2010
Nature of Operations and Summary of Significant Accounting Policies
Nature of Operations and Summary of Significant Accounting Policies	1) Nature of Operations and Summary of Significant Accounting Policies Nature of Operations JCPenney was founded by James Cash Penney in 1902 and has grown to be a major national retailer, operating 1,108 JCPenney department stores in 49 states and Puerto Rico, as well as through the Internet at jcp.com and catalog. We sell family apparel and footwear, accessories, fine and fashion jewelry, beauty products through Sephora inside JCPenney, and home furnishings. In addition, our department stores provide services, such as styling salon, optical, portrait photography and custom decorating, to customers. Basis of Presentation and Consolidation The consolidated financial statements present the results of J. C. Penney Company, Inc. and our subsidiaries (the Company or JCPenney). All significant intercompany transactions and balances have been eliminated in consolidation. We are 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 direct subsidiaries other than JCP, and has no independent assets or operations. Our Company is a co-obligor (or guarantor, as appropriate) regarding the payment of principal and interest on JCPs outstanding debt securities. We guarantee certain of JCPs outstanding debt securities fully and unconditionally. Fiscal Year Our fiscal year ends on the Saturday closest to January31. Unless otherwise stated, references to years in this report relate to fiscal years rather than to calendar years. Fiscal Year Ended Weeks 2009 January 30, 2010 52 2008 January 31, 2009 52 2007 February 2, 2008 52 Use of Estimates The preparation of financial statements, in conformity with generally accepted accounting principles in the United States of America (GAAP), requires us to make assumptions and use estimates that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant estimates relate to: inventory valuation under the retail method, specifically permanent reductions to retail prices (markdowns) and adjustments for shortages (shrinkage); valuation of long-lived assets; valuation allowances and reserves for workers compensation and general liability, environmental contingencies, income taxes and litigation; and pension accounting. While actual results could differ from these estimates, we do not expect the differences, if any, to have a material effect on the consolidated financial statements. Reclassifications Certain reclassifications were made to prior year amounts to conform to the current period presentation. None of the reclassifications affected our net income in any period. Merchandise Inventory In the fourth quarter of 2009, we elected to change our method of valuing inventory to the FIFO method from the LIFO method. We believe that the FIFO method is

Effect of New Accounting Standa

Effect of New Accounting Standards
	12 Months Ended Jan. 30, 2010
Effect of New Accounting Standards
Effect of New Accounting Standards	2) Effect of New Accounting Standards Adoption of New Accounting Standards Fair Value Measurements The FASB issued a series of guidance about fair value measurements and included an initial standard that we adopted beginning in 2008, which defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. This statement applies under other accounting pronouncements that require or permit fair value measurements, but does not require any new fair value measurements. The adoption did not have a material impact on our consolidated financial statements. In October 2008, we adopted FASB guidance, which clarifies the application of fair value measurements as it relates to the valuation of financial assets in inactive markets. The adoption of the guidance did not have a material impact on our consolidated financial statements. Beginning in the second quarter of 2009, we adopted FASB guidance on how to determine the fair value of assets and liabilities when the volume and level of activity for the asset or liability has significantly decreased. Also, this guidance provides information on identifying circumstances that indicate a transaction is not orderly. Further, the guidance requires disclosure in interim and annual periods of the inputs and valuation techniques used to measure fair value and a discussion of changes in valuation techniques. Our adoption of this guidance did not have a significant impact on our consolidated financial statements. Beginning in the second quarter of 2009, we adopted FASB guidance that requires disclosures about the fair value of financial instruments whenever a public company issues financial information for interim reporting periods. The guidance did not have a material impact on our consolidated financial statements. Effective for periods ending after December 15, 2009, we adopted FASB guidance on investments in certain entities that calculate NAV per share (or its equivalent). We applied this guidance with the fair value measurement of our primary pension plan assets disclosure of level 2 investments as a practical expedient to estimate fair value. Since the guidance expedites measurement of investments in certain entities that are disclosed only and not recorded, our adoption of the guidance did not have a material impact on our consolidated financial statements. Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities Beginning in 2009, we adopted FASB guidance that clarifies that unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and shall be included in the computation of EPS pursuant to the two-class method. Dividend equivalents on our unvested share-based payment transactions are forfeited if the corresponding shares do not vest; therefore, our adoption of this guidance did not have any impact on our consolidated financial statements. Recognition and Presentation of Other-Than-Temporary Impairment Beginning in the second quarter of 2009, we adopted FASB guidance that amend

Earnings per Share

Earnings per Share
	12 Months Ended Jan. 30, 2010
Earnings per Share
Earnings per Share	3) Earnings per Share Income from continuing operations and shares used to compute EPS from continuing operations, basic and diluted, are reconciled below: (in millions, except EPS) 2009 2008 2007 Earnings: Income from continuing operations, basic anddiluted $ 249 $ 567 $ 1,105 Shares: Average common shares outstanding (basic shares) 232 222 223 Adjustment for assumed dilution stock options and restrictedawards 1 1 2 Average shares assuming dilution (diluted shares) 233 223 225 EPS from continuing operations: Basic $ 1.07 $ 2.55 $ 4.96 Diluted $ 1.07 $ 2.54 $ 4.90 The following average potential shares of common stock were excluded from the diluted EPS calculations because their effect would be anti-dilutive: (shares in millions) 2009 2008 2007 Stock options and restricted awards 9 9 2

Supplemental Cash Flow Informat

Supplemental Cash Flow Information
	12 Months Ended Jan. 30, 2010
Supplemental Cash Flow Information
Supplemental Cash Flow Information	4) Supplemental Cash Flow Information ($ in millions) 2009 2008 2007 Total income taxes paid $ 130 $ 209 $ 616 Add: income taxes received attributable todiscontinued operations 4 3 15 Income taxes paid by continuing operations $ 134 $ 212 $ 631 Interest paid by continuing operations $ 264 $ 265 $ 283(1) Interest received by continuing operations 5 35 118 (1) Includes $9 million for bond premiums and commissions. In May 2009, we made a voluntary contribution of approximately 13.4 million newly issued shares of JCPenney common stock, valued at $340 million, to the J. C. Penney Corporation, Inc. Pension Plan. There were no significant non-cash investing or financing activities in 2008 or 2007.

Other Assets

Other Assets
	12 Months Ended Jan. 30, 2010
Other Assets
Other Assets	5) Other Assets ($ in millions) 2009 2008 Capitalized software, net $178 $140 Real estate investments(1) 169 90 Leveraged lease investments 141 139 Debt issuance costs, net 26 30 Other 58 25 Total $ 572 $ 424 (1) Primarily the market value of our investment in public REITs accounted for as available for sale securities. As of January 30, 2010 and January 31, 2009 the cost basis of these investments was $80 million and $75 million, respectively. The change from year to year relates primarily to the increase in market value of these investments. See Note 13 for the net unrealized gains on real estate investments.

Other Accounts Payable and Accr

Other Accounts Payable and Accrued Expenses
	12 Months Ended Jan. 30, 2010
Other Accounts Payable and Accrued Expenses
Other Accounts Payable and Accrued Expenses	6) Other Accounts Payable and Accrued Expenses ($ in millions) 2009 2008 Accrued salaries, vacation and bonus $481 $343 Customer gift cards 219 215 Occupancy and rent-related accounts payable 97 88 Taxes other than income taxes 95 109 Interest payable 88 92 Advertising accounts payable 78 100 Current portion of workers compensation and general liability insurance 66 63 Capital expenditures payable 55 92 Unrecognized tax benefits 55 88 Common dividends payable 47 44 Current portion of retirement plan liabilities 37 29 Other(1) 312 337 Total $ 1,630 $ 1,600 (1) Includes individually insignificant accrued expenses related to operations.

Other Liabilities

Other Liabilities
	12 Months Ended Jan. 30, 2010
Other Liabilities
Other Liabilities	7) Other Liabilities ($ in millions) 2009 2008 Supplemental pension and other postretirement benefit plan liabilities $ 238 $ 240 Long-term portion of workers compensation and general liability insurance 187 168 Deferred developer/tenant allowances 145 121 Unrecognized tax benefits 110 104 Primary pension plan 12 275 Other 46 50 Total $ 738 $ 958

Fair Value Disclosures

Fair Value Disclosures
	12 Months Ended Jan. 30, 2010
Fair Value Disclosures
Fair Value Disclosures	8) Fair Value Disclosures REIT Assets Measured on a Recurring Basis We determined the fair value of our investments in REITs using quoted market prices. See Note 13 for the net unrealized gain of $63 million in REITs recorded in 2009 in accumulated other comprehensive income, a component of net equity. Our REIT assets measured at fair value on a recurring basis were as follows: ($ in millions) Fair Value as of January 30, 2010 Fair Value as of January 31, 2009 Level 1 Level 2 Level 3 Level 1Level 2Level 3 REIT assets $178 $ - $ - $ 98 $ - $ - Other Non-Financial Assets Measured on a Non-Recurring Basis In 2009, seven underperforming stores with a carrying value of $43 million and other corporate assets with a carrying value of $20 million were written down to their fair value of $18 million and $6 million, respectively, and resulted in an impairment charge of $39 million, which was included in earnings for the period. The inputs to determine fair values were primarily based on projected discounted cash flow as well as other market information obtained from brokers. Our other non-financial assets measured at fair value on a non-recurring basis in 2009 and remaining on our Consolidated Balance Sheet at year end were as follows: ($ in millions) Fair Value as of January 30, 2010 Level1 Level2 Level3 Total Stores $ - $ - $ 18 $ 18 Other corporate assets - 3 3 6 Other Financial Instruments Cash and Cash Equivalents The carrying amount approximates fair value because of the short maturity of these instruments. Long-Term Debt The fair value of long-term debt is estimated by obtaining quotes from brokers or is based on current rates offered for similar debt. At January 30, 2010, long-term debt, including current maturities, had a carrying value of $3.4 billion and a fair value of $3.3 billion. At January 31, 2009, long-term debt had a carrying value of $3.5billion and a fair value of $2.6 billion. Concentrations of Credit Risk We have no significant concentrations of credit risk.

Credit Agreement

Credit Agreement
	12 Months Ended Jan. 30, 2010
Credit Agreement
Credit Agreement	9) Credit Agreement On April 8, 2009, J. C. Penney Company, Inc., JCP and J. C. Penney Purchasing Corporation entered into a three-year, $750 million revolving credit agreement (2009 Credit Facility) with a syndicate of lenders with JPMorgan Chase Bank, N.A., as administrative agent. The 2009 Credit Facility replaced our $1.2 billion credit facility that was scheduled to expire in April 2010. The 2009 Credit Facility is secured by our inventory, which security interest can be released upon attainment of certain credit rating levels, and is available for general corporate purposes, including the issuance of letters of credit. Pricing under the 2009 Credit Facility is tiered based on JCPs senior unsecured long-term credit ratings issued by Moodys Investors Service, Inc. and Standard Poors Ratings Services. JCPs obligations under the 2009 Credit Facility are guaranteed by J. C. Penney Company, Inc. The 2009 Credit Facility requires that we maintain certain financial covenants, which include a leverage ratio, a fixed charge coverage ratio and an asset coverage ratio (each as defined in the 2009 Credit Facility). Under the terms of the 2009 Credit Facility, non-cash charges or credits related to retirement plans are not included in the calculation of EBITDA (consolidated earnings before income taxes less depreciation and amortization), which is used in the leverage ratio and fixed charge coverage ratio. The leverage ratio, which is calculated as of the last day of the quarter and measured on a trailing four-quarter basis, cannot exceed 4 to 1 through January30, 2010; 3.5 to 1 from January31, 2010 through October30, 2010; and 3 to 1 thereafter. The fixed charge coverage ratio, which is calculated as of the last day of the quarter and measured on a trailing four-quarter basis, cannot be less than 2.25 to 1 through October30, 2010; 2.5 to 1 from October31, 2010 through October29, 2011; and 3 to 1 thereafter. The asset coverage ratio, which is calculated as of the last day of each fiscal month, cannot be less than 3 to 1. As of January 30, 2010, we were in compliance with these requirements with a leverage ratio of 2.3 to 1, a fixed charge coverage ratio of 3.4 to 1 and an asset coverage ratio of 23 to 1. No borrowings, other than the issuance of standby and import letters of credit totaling $134 million as of the end of 2009, have been made under the 2009 Credit Facility.

Long-Term Debt

Long-Term Debt
	12 Months Ended Jan. 30, 2010
Long-Term Debt
Long-Term Debt	10) Long-Term Debt ($ in millions) 2009 2008 Issue: 5.75% Senior Notes due 2018 $ 300 $ 300 6.375% Senior Notes due 2036 700 700 6.875% Medium-Term Notes due 2015 200 200 6.9% Notes due 2026 2 2 7.125% Debentures due 2023 255 255 7.4% Debentures due 2037 326 326 7.625% Notes due 2097 500 500 7.65% Debentures due 2016 200 200 7.95% Debentures due 2017 285 285 8.0% Notes due 2010 393 506 9.0% Notes due 2012 230 230 Total notes and debentures 3,391 3,504 Capital lease obligations 1 1 Total long-term debt, including current maturities 3,392 3,505 Less: current maturities 393 - Total long-term debt $ 2,999 $ 3,505 Weighted-average interest rate at year end 7.3% 7.3% Weighted-average maturity 24 years 2009 Debt Repurchase In May 2009, we accepted for purchase $104 million principal amount of JCPs outstanding 8.0% Notes due 2010 (Notes), which were validly tendered pursuant to the cash tender offer we initiated in April 2009 to purchase up to $200 million aggregate principal amount of the Notes. We paid $107 million aggregate consideration, including accrued and unpaid interest, for the accepted Notes in May 2009. In addition we purchased $9 million of these Notes in the open market in July 2009. 2008 Debt Payment In August 2008, we repaid at maturity $200 million outstanding principal amount of JCPs 7.375% Notes due 2008. Long-Term Debt Financial Covenants We have an indenture covering approximately $255 million of long-term debt that contains a financial covenant requiring us to have a minimum of 200% net tangible assets to senior funded indebtedness (as defined in the indenture). This indenture permits our Company to issue additional long-term debt if we are in compliance with the covenant. At year-end 2009, our percentage of net tangible assets to senior funded indebtedness was 334%. Scheduled Annual Principal Payments on Long-Term Debt ($ in millions) 2010 2011 2012 2013 2014 2015-2097 $ 393 $ - $ 230 $ - $ - $ 2,769

Net Interest Expense

Net Interest Expense
	12 Months Ended Jan. 30, 2010
Net Interest Expense
Net Interest Expense	11) Net Interest Expense ($ in millions) 2009 2008 2007 Long-term debt $ 255 $ 268 $ 278 Short-term investments (3) (32) (113) Other, net 8(1) (11) (12) Total $ 260 $ 225 $ 153 (1) Reflects increased financing costs due to the 2009 Credit Facility and lower levels of capitalized interest due to lower capital expenditures.

Capital Stock

Capital Stock
	12 Months Ended Jan. 30, 2010
Capital Stock
Capital Stock	12) Capital Stock Common Stock As of January 30, 2010, we had 33,530 stockholders of record. On a combined basis, our 401(k) savings plan, including our employee stock ownership plan (ESOP), held approximately 17million shares, or approximately 7.3% of outstanding JCPenney common stock, at January 30, 2010. Also at January 30, 2010, our primary pension plan held 7.9 million shares, or approximately 3.4% of outstanding JCPenney common stock. Preferred Stock We have authorized 25million shares of preferred stock; no shares of preferred stock were issued and outstanding as of January 30, 2010 or January 31, 2009.

Accumulated Other Comprehensive

Accumulated Other Comprehensive (Loss)/Income
	12 Months Ended Jan. 30, 2010
Accumulated Other Comprehensive (Loss)/Income
Accumulated Other Comprehensive (Loss)/Income	13) Accumulated Other Comprehensive (Loss)/Income 2009 2008 Pre-Tax Amount Deferred Tax (Liability)/ Asset Net of Tax Amount Pre-Tax Amount Deferred Tax (Liability)/ Asset Net of Tax Amount ($ in millions) Net unrealized gains on real estate investments $98 $ (35) $63 $ 23 $ (8) $15 Net actuarial (loss)/gain and prior service (cost)/credit pension and postretirement plans(1) (2,118) 825 (1,293) (2,339) 910 (1,429) Accumulated other comprehensive (loss) $ (2,020) $ 790 $ (1,230) $ (2,316) $902 $(1,414) (1) See Note 16 for breakdowns of the pre-tax actuarial (loss)/gain and prior service (cost)/credit balances.

Stock-Based Compensation

Stock-Based Compensation
	12 Months Ended Jan. 30, 2010
Stock-Based Compensation
Stock-Based Compensation	14) Stock-Based Compensation At our Annual Meeting of Stockholders on May 15, 2009, our stockholders approved the J. C Penney Company, Inc. 2009 Long-Term Incentive Plan (2009 Plan), reserving 13.1 million shares for future grants (8.5 million newly authorized shares, plus up to 4.6 million reserved but unissued shares from our prior 2005 Equity Compensation Plan (2005 Plan)). In addition, shares underlying any outstanding stock award or stock option grant canceled prior to vesting or exercise become available for use under the 2009 Plan. The 2005 Plan was terminated on May 15, 2009, except for outstanding awards. Subsequent awards have been and will be granted under the 2009 Plan. The 2009 Plan allows for grants of stock options, stock appreciation rights and stock awards (collectively, Equity Awards) and cash incentive awards (together, Awards) to employees (associates) and Equity Awards to our non-employee members of the Board of Directors. Under the Plan, Awards to associates are subject to such conditions as continued employment, qualifying termination, passage of time and/or satisfaction of performance criteria as specified in the Plan or set by the Human Resources and Compensation Committee of the Board. As of January 30, 2010, 14.2million shares of stock were available for future grant under the 2009 Plan, which includes approximately 1.3 million shares from awards cancelled subsequent to May 15, 2009. Associate stock options and restricted stock awards typically vest over periods ranging from one to three years. The exercise price of stock options and the market value of restricted stock awards are determined based on the closing market price of our common stock on the date of grant. The 2009 Plan does not permit awarding stock options below grant-date market value nor does it allow any repricing subsequent to the date of grant. Associate stock options have a maximum term of 10 years. Over the past three years, our stock option and restricted stock award grants have averaged about 1.8% of total outstanding stock. We issue new shares upon the exercise of stock options, granting of restricted shares and vesting of restricted stock units. Stock-Based Compensation Cost ($ in millions) 2009 2008 2007 Stock options $ 28 $ 29 $ 23 Stock awards (shares and units) 12 18 22 Total stock-based compensation cost $ 40 $ 47 $ 45 Total income tax benefit recognized for stock-based compensation arrangements $ 15 $ 18 $ 18 Stock Options On March16, 2009, we made our annual grant of stock options covering approximately 3,873,000 shares to associates at an option price of $16.09, with a fair value of $6.27 per option. As of January 30, 2010, options to purchase approximately 13.6 million shares of common stock were outstanding. If all options were exercised, common stock outstanding would increase by 5.7%. Additional information regarding options outstanding as of January 30, 2010 follows: (Shares in thousands; price is weighted-average exercise price) Exercisable Unexercisable Total Outstanding Shares % Price Shares

Leases

Leases
	12 Months Ended Jan. 30, 2010
Leases
Leases	15) Leases We conduct the major part of our operations from leased premises that include retail stores, store distribution centers, warehouses, offices and other facilities. Almost all leases will expire during the next 20 years; however, most leases will be renewed, primarily through an option exercise, or replaced by leases on other premises. We also lease data processing equipment and other personal property under operating leases of primarily three to five years. Rent expense, net of sublease income, was as follows: Rent Expense ($ in millions) 2009 2008 2007 Real property base rent and straight-lined step rent expense $ 231 $ 217 $ 210 Real property contingent rent expense (based on sales) 14 22 26 Personal property rent expense 59 63 61 Total rent expense $ 304 $ 302 $ 297 As of January 30, 2010, future minimum lease payments for non-cancelable operating leases, including lease renewals determined to be reasonably assured and net of future non-cancelable operating sublease payments, and capital leases were: ($ in millions) Operating Capital 2010 $ 263 $ - 2011 223 - 2012 185 - 2013 156 - 2014 140 - Thereafter 1,942 1 Total minimum lease payments $ 2,909 $ 1 Present value $ 1,270 $ 1 Weighted-average interest rate 8.0% 8.3%

Retirement Benefit Plans

Retirement Benefit Plans
	12 Months Ended Jan. 30, 2010
Retirement Benefit Plans
Retirement Benefit Plans	16) Retirement Benefit Plans We provide retirement pension benefits, postretirement health and welfare benefits, as well as 401(k) savings, profit-sharing and stock ownership plan benefits to various segments of our workforce (associates). Retirement benefits are an important part of our total compensation and benefits program designed to attract and retain qualified, talented associates. Pension benefits are provided through defined benefit pension plans consisting of a non-contributory qualified pension plan (primary plan) and, for certain management associates, non-contributory supplemental retirement plans, including a 1997 voluntary early retirement plan. Retirement and other benefits include: Defined Benefit Pension Plans Other Benefit Plans Primary plan funded Postretirement benefits medical and dental Supplemental retirement plans unfunded Defined contribution plans: 401(k) savings, profit-sharing and stock ownership plan Deferred compensation plan On May 18, 2009, along with the voluntary contribution of approximately 13.4 million shares of JCPenney common stock to the primary plan valued at $340 million (discussed in the contributions section of this note) and to update assumptions relating to the pension liability, we remeasured the primary plan assets and obligations. Upon remeasurement, primarily as a result of the contribution, the funded status of the plan at the remeasurement date increased $310 million to a positive $35 million compared with a deficiency of $275 million at the January 31, 2009 measurement date, representing a funded status of 101% versus 93%. The net periodic benefit expense for 2009 at the remeasurement date was reduced by $24 million to $298 million from the original estimate of $322 million. The measurement date for the determination of pension income for fiscal year 2008 was February3, 2008. The year-end measurement date of January31, 2009 was used to record the funded status of the plan and to determine 2009 pension expense. On February 3, 2008, we adopted new pension accounting guidance and transitioned to a fiscal year-end measurement date by remeasuring primary plan assets and benefit obligations as of the beginning of 2008. As a result, we recorded an increase of $26 million, net of tax, to 2008 opening retained earnings for the transition adjustment to recognize three months of net periodic benefit income from October31, 2007 to February2, 2008. In addition, we recorded a decrease of $343 million, net of tax, to the 2008 opening balance of accumulated other comprehensive income, a component of net equity, to reflect the changes in fair value of plan assets and the benefit obligation from October31, 2007 to February2, 2008, which included an increase in the discount rate from 6.46% to 6.54%. The expected return on plan assets was unchanged at 8.9%. Defined Benefit Pension Plans Primary Plan Funded The primary plan is a funded non-contributory qualified pension plan. The primary plan, initiated in 1966, was closed to new entrants on January1, 2007. As of 2009, the primary plan had approximately 156,000 plan participants of whom about half were

Real Estate and Other, Net

Real Estate and Other, Net
	12 Months Ended Jan. 30, 2010
Real Estate and Other, Net
Real Estate and Other, Net	17) Real Estate and Other, Net ($ in millions) 2009 2008 2007 Real estate activities $ (34) $ (39) $ (39) Net gains from sale of real estate (2) (10) (10) Impairments and other 41 24 3 Total expense/(income) $ 5 $ (25) $ (46) Real estate and other consists mainly of ongoing operating income from our real estate subsidiaries whose primary investments are in REITs, as well as investments in 14 joint ventures that own regional mall properties, six as general partner and eight as limited partner. Real estate and other also includes net gains from the sale of facilities and equipment that are no longer used in Company operations, asset impairments and other non-operating corporate charges and credits. In 2009, impairment charges totaled $42 million and were primarily related to seven underperforming department stores and other corporate assets. Included in the $42 million is an impairment charge of $3 million relating to a corporate asset that was disposed of by year-end. Of the seven stores, three will continue to operate in their existing locations while the remaining stores are candidates for relocation or closure. In 2008, impairment charges of $21 million primarily related to a department store, a real estate joint venture and other corporate assets.

Income Taxes

Income Taxes
	12 Months Ended Jan. 30, 2010
Income Taxes Abstract
Income Taxes	18) Income Taxes Our deferred tax assets and liabilities as of January 30, 2010 and January 31, 2009 were as follows: 2009 2008 ($ in millions) Deferred TaxAssets Deferred Tax (Liabilities) Deferred TaxAssets Deferred Tax (Liabilities) Current Merchandise inventory $ 51 $ - $ 48 $ - Accrued vacation pay 42 - 48 - Gift cards 61 - 56 - Capitalized advertising costs - (12) - (19) Other 46(1) (51)(2) 64(1) (49)(2) Total current 200 (63) 216 (68) Net current assets 137(3) 148(3) Non-current Depreciation and amortization - (1,031) - (909) Pension and other retiree obligations 119 - 224 - Stock-based compensation 56 - 51 - Mirror Savings Plan 23 - 32 - Accrued rent 21 - 12 - Leveraged leases - (195) - (214) State taxes 48 - 37 - Unrealized gain/loss - (35) - (8) Workers compensation/general liability 104 - 95 - Other(4) 74 (1) 82 (1) Total non-current $ 445 $ (1,262) $ 533 $(1,132) Net non-current (liabilities) $ (817) $ (599) Total net deferred tax (liabilities) $ (680) $ (451) (1) Includes tax items related to accruals for sales returns, miscellaneous benefit plans and discontinued operations. (2) Includes tax items related to property taxes and prepaid expenses. (3) Included in income taxes receivable on our Consolidated Balance Sheets. (4) Includes tax items related to environmental cleanup costs and discontinued operations. We anticipate that we will generate sufficient pre-tax income in the future to realize the full benefit of the deferred tax assets related to future deductible amounts. Accordingly, a valuation was not required at year-end 2009 or 2008. Income taxes receivable on our Consolidated Balance Sheets included current income taxes receivable of $258 million at the end of 2009 and $204 million at the end of 2008, in addition to the net current deferred tax assets shown above. Unrecognized tax benefits totaled $165 million as of January 30, 2010, compared to $192 million as of January 31, 2009. A reconciliation of unrecognized tax benefits is as follows: ($ in millions) 2009 2008 2007 Beginning balance $ 192 $ 160 $ 181 Additions for tax positions related to the current year - 32 22 Additions for tax positions of prior years 37 11 - Reductions for tax positions of prior years (1) (5) - Settlements and effective settlements with tax authorities (59) (6) (43) Expirations of statute (4) - - Balance at end of year $ 165(1) $ 192(1) $ 160(1) (1) Includes $7 million, $7 million and $12 million related to discontinued operations at the end of 2009, 2008 and 2007, respectively. As

Litigation, Other Contingencies

Litigation, Other Contingencies and Guarantees
	12 Months Ended Jan. 30, 2010
Litigation, Other Contingencies and Guarantees
Litigation, Other Contingencies and Guarantees	19) Litigation, Other Contingencies and Guarantees We are subject to various legal and governmental proceedings involving routine litigation incidental to our business. Reserves have been established based on our best estimates of our potential liability in certain of these matters. These estimates have been 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. As of January 30, 2010, we estimated our total potential environmental liabilities to range from $49 million to $60 million and recorded our best estimate of $53 million in other liabilities in the Consolidated Balance Sheet as of that date. This estimate covered potential liabilities primarily related to underground storage tanks, remediation of environmental conditions involving our former Eckerd drugstore locations and asbestos removal in connection with approved plans to renovate or dispose of our facilities. We continue to assess required remediation and the adequacy of environmental reserves as new information becomes available and known conditions are further delineated. If we were to incur losses at the upper end of the estimated range, we do not believe that such losses would have a material effect on our financial condition, results of operations or liquidity. As part of the 2001 asset sale of J. C. Penney Direct Marketing Services, Inc., JCP signed a guarantee agreement with a maximum exposure of $20 million. Any potential claims or losses are first recovered from established reserves, then from the purchaser and finally from any state insurance guarantee fund before JCPs guarantee would be invoked. As a result, we do not believe that any potential exposure would have a material effect on our consolidated financial statements.

Discontinued Operations

Discontinued Operations
	12 Months Ended Jan. 30, 2010
Discontinued Operations
Discontinued Operations	20) Discontinued Operations Our consolidated financial statements reflect activity related to operations we discontinued prior to 2006, and consisted primarily of adjustments reflecting managements ongoing review and true-up of reserves for discontinued operations, including tax reserves. Discontinued Operations ($ in millions, except per share data) 2009 2008 2007 Income from discontinued operations $ 3 $ 2 $ 10 Income tax expense/(benefit) related to discontinued operations 1 (3) 4 Total income from discontinued operations, net of income taxes $ 2 $ 5 $ 6 Diluted EPS for discontinued operations $ 0.01 $ 0.03 $ 0.03 We do not expect previously discontinued operations to have a future material impact on our results of operations, financial condition or liquidity.

Quarterly Results of Operations

Quarterly Results of Operations (Unaudited)
	12 Months Ended Jan. 30, 2010
Quarterly Results of Operations (Unaudited)
Quarterly Results of Operations (Unaudited)	21) Quarterly Results of Operations (Unaudited) The following is a summary of our quarterly unaudited consolidated results of operations for 2009 and 2008: First Quarter SecondQuarter Third Quarter FourthQuarter ($ in millions, except per share data) 2009 2008 2009 2008 2009 2008 2009 2008 Total net sales $ 3,884 $ 4,127 $ 3,943 $ 4,282 $ 4,179 $ 4,318 $5,550 $ 5,759 Gross margin 1,574 1,650 1,520 1,606 1,696 1,664 2,120 1,995 SGA expenses 1,255 1,317 1,242 1,270 1,376 1,320 1,509 1,488 Income/(loss)fromcontinuingoperations 25 120 (1) 116 27 123 198 208 Discontinued operations - - - 1 - 1 2 3 Net income/(loss) $ 25 $ 120 $ (1) $ 117 $ 27 $ 124 $ 200 $ 211 Diluted EPS(1): Continuing operations $ 0.11 $ 0.54 $ - $ 0.52 $ 0.11 $ 0.55 $ 0.84 $ 0.94 Discontinued operations - - - - - 0.01 - 0.01 Net income $ 0.11 $ 0.54 $ - $ 0.52 $ 0.11 $ 0.56 $ 0.84 $ 0.95 (1) Per share amounts are computed independently for each of the quarters presented. The sum of the quarters may not equal the total year amount due to the impact of changes in average quarterly shares outstanding.

Document Information

Document Information
	12 Months Ended Jan. 30, 2010
Document Information [Line Items]
Document Type	10-K
Amendment Flag	false
Document Period End Date	2010-01-30

Entity Information

Entity Information (USD $)
	12 Months Ended Jan. 30, 2010	Mar. 22, 2010	Aug. 01, 2009
Entity Information [Line Items]
Entity Registrant Name	J C PENNEY CO INC
Entity Central Index Key	0001166126
Current Fiscal Year End Date	--01-30
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$6,767,999,610
Entity Listings [Line Items]
Entity Common Stock, Shares Outstanding		236,228,947