J.C. Penney Closing Unprofitable Stores

Updated from 6:21 a.m. EST

PLANO, Texas ( TheStreet) -- J.C. Penney ( JCP) said Monday it plans to close certain underperforming stores and wind down its catalog and outlet operations.

The retailer plans to close five JCPenney department stores across the U.S. and one JCPenney Home Store in Duluth, Ga. "These six locations no longer meet the company's profitability threshold," J.C. Penney said in a statement.

J.C. Penney also said over the course of 2011 and 2012 it will complete the wind down of its catalog business, including exiting its catalog outlets. The business includes a total of 19 outlet stores.

J.C. Penney said the actions will add $25 million to $30 million, or 7 cents a share, to 2012 earnings. The company will record a charge in the fourth-quarter of fiscal 2010 of about $30 million, or 8 cents a share, and a charge of about $20 million, or 5 cents a share, during 2011.

J.C. Penney also said it named William Ackman, founder and CEO of Pershing Square Capital Management, and Steven Roth, chairman of Vornado Realty Trust, to its board.

Back in October, Ackman disclosed his fund brought its stake in J.C. Penney to almost 17%. The purchase made Pershing the company's largest shareholder.

-- Written by Joseph Woelfel

>To contact the writer of this article, click here: Joseph Woelfel

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