<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM 11-K
(MARK ONE)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1993
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
FOR THE TRANSITION PERIOD FROM ___________ TO ___________
COMMISSION FILE NUMBER 1-777
--------------------------
A. FULL TITLE OF THE PLAN AND THE ADDRESS OF THE PLAN, IF DIFFERENT FROM THAT
OF THE ISSUER NAMED BELOW:
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND STOCK OWNERSHIP PLAN
12700 PARK CENTRAL PLACE
DALLAS, TEXAS 75251
B. NAME OF ISSUER OF THE SECURITIES HELD PURSUANT TO THE PLAN AND THE ADDRESS
OF ITS PRINCIPAL EXECUTIVE OFFICE:
J. C. PENNEY COMPANY, INC.
6501 LEGACY DRIVE
PLANO, TEXAS 75024-3698
<PAGE>
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Financial Statements and Schedules
December 31, 1993 and 1992
(With Independent Auditors' Report Thereon)
<PAGE>
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Table of Contents
-----------------
Independent Auditors' Report
Statements of Net Assets Available for Benefits
as of December 31, 1993 and 1992
Statements of Changes in Net Assets Available for
Benefits for the years ended December 31, 1993 and 1992
Notes to Financial Statements
Schedule
--------
Schedule of Assets Held for Investment Purposes
as of December 31, 1993 1
Schedule of Reportable Transactions for the
year ended December 31, 1993 2
<PAGE>
[LETTERHEAD OF KPMG - PEAT MARWICK]
INDEPENDENT AUDITORS' REPORT
----------------------------
The J. C. Penney Company, Inc.
Associate Benefits Committee,
Benefit Plans Investment Committee,
Retirement Plans Committee, and the
Benefit Plans Review Committee:
We have audited the accompanying statements of net assets available for benefits
of the J. C. Penney Company, Inc. Savings, Profit-Sharing and Stock Ownership
Plan as of December 31, 1993 and 1992, and the related statements of changes in
net assets available for benefits for the years then ended. These financial
statements are the responsibility of the Plan's management. Our responsibility
is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the J. C.
Penney Company, Inc. Savings, Profit-Sharing and Stock Ownership Plan as of
December 31, 1993 and 1992, and the changes in net assets available for benefits
for the years then ended in conformity with generally accepted accounting
principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets
held for investment purposes and reportable transactions are presented for
purposes of additional analysis and are not a required part of the basic
financial statements but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The supplemental schedules
have been subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, are fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
/s/ KPMG Peat Marwick
May 13, 1994
<PAGE>
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Statements of Net Assets Available for Benefits
December 31, 1993 and 1992
<TABLE>
<CAPTION>
1993 1992
---------------- --------------
<S> <C> <C>
Assets:
Investments, at fair value:
J. C. Penney Company, Inc.
common stock - 6,182,647
shares in 1993 and 4,682,294
shares in 1992
(cost $219,409,375 and
$133,479,935, respectively) $ 325,361,798 181,976,674
J. C. Penney Company, Inc.
preferred stock - 1,082,112
shares in 1993 and 1,110,952
shares in 1992 (cost
$649,267,042 and $666,571,103,
respectively) 1,138,922,612 863,615,633
State Street Bank Index Fund -
786,756 units in 1993 and
649,336 units in 1992 (cost
$43,391,017 and
$32,518,467, respectively) 54,754,297 41,064,629
State Street Bank Liquidity Fund
(cost approximates fair value) 15,519,787 10,459,308
Funds held under structured
investment contracts:
U.S. agency backed
collateralized mortgage
obligations (cost $181,202,290
in 1993 and $121,951,055 in 1992) 185,852,394 122,888,630
Government trust certificates
(cost $10,545,346 in 1993) 10,389,891 --
Wrap agreements (cost $1,449,420
in 1993 and $508,148 in 1992) (2,835,741) (264,038)
Participants' loans (unpaid
principal balance approximates
fair value) 31,426,436 21,034,934
Funds with insurance companies,
at contract value 109,223,830 146,124,378
-------------- -------------
Total investments 1,868,615,304 1,386,900,148
-------------- -------------
Receivables:
Due from J. C. Penney Company, Inc. 600,034 432,403
Accrued interest and dividends 9,031 28,157
-------------- -------------
609,065 460,560
-------------- -------------
Total assets 1,869,224,369 1,387,360,708
-------------- -------------
Liabilities:
Cash overdraft 1,334 6,885
Loan payable 413,752,773 478,416,565
Accrued interest payable 16,901,801 19,543,316
Due to broker 2,861,912 3,473,000
Accounts payable and other
liabilities 924,871 268,193
-------------- -------------
Total liabilities 434,442,691 501,707,959
-------------- -------------
Net assets available for benefits $1,434,781,678 885,652,749
============== =============
</TABLE>
See accompanying notes to financial statements.
<PAGE>
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Statements of Changes in Net Assets
Available for Benefits
Years ended December 31, 1993 and 1992
<TABLE>
<CAPTION>
1993 1992
---------------- ------------
<S> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation in fair value
of investments $ 383,304,270 251,709,113
Interest 22,418,814 20,115,919
Dividends 60,089,452 59,453,175
-------------- -----------
465,812,536 331,278,207
Less investment expenses (108,768) (52,916)
-------------- -----------
465,703,768 331,225,291
-------------- -----------
Contributions:
J. C. Penney Company, Inc. 50,136,087 48,731,483
Participants 149,384,249 137,291,537
-------------- -----------
199,520,336 186,023,020
-------------- -----------
Total additions 665,224,104 517,248,311
-------------- -----------
Deductions from net assets attributed to:
Benefit payments 80,885,198 74,753,224
Interest expense 35,150,796 40,330,157
Deferral fees 59,181 22,451
-------------- -----------
Total deductions 116,095,175 115,105,832
-------------- -----------
Change in net assets available for
benefits 549,128,929 402,142,479
Beginning net assets available for
benefits 885,652,749 483,510,270
-------------- -----------
Ending net assets available for
benefits $1,434,781,678 885,652,749
============== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Notes to Financial Statements
December 31, 1993 and 1992
(1) Description of Plan
-------------------
The following brief description of the provisions of the J. C. Penney
Company, Inc. Savings, Profit-Sharing and Stock Ownership Plan (the "Plan")
is provided for general informational purposes only. Participants should
refer to the Plan summary description for more complete information. The
Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA").
(a) General
-------
The Plan is a defined contribution plan available to all eligible
employees ("Associates") of J. C. Penney Company, Inc. (the "Company")
and certain subsidiaries. Associates who have completed at least 1,000
hours of service within a period of 12 consecutive months and have
attained age 21 are eligible to participate in the Plan.
The financial statements include all of the funds which comprise the
Plan. All administrative expenses of the Plan not paid by the Trust
are paid by the Company.
(b) Contributions
-------------
Participants that are classified as highly compensated (earning
$20,000 or more annually) are permitted to contribute from 1% to 10%
of their earnings with a maximum of 8% in Tax-deferred Deposits
(subject to annual maximum of $8,994 in 1993 and $8,728 in 1992).
Nonhighly compensated participants may contribute in 1% increments up
to 16% of earnings in either Taxed or Tax-deferred Deposits or a
combination of both.
The Company contributes to the Plan an amount which when combined with
the dividends earned on the J. C. Penney Company, Inc. Series B ESOP
Convertible Preferred Stock ("Preferred Stock") will be sufficient to
service the semiannual loan payments (see note 3). The Company's
contribution amounted to $50.1 million in 1993 and $48.7 million in
1992. At the time of each loan payment shares of Preferred Stock are
allocated to participants' accounts. In accordance with the terms of
the Plan, 116,667 shares of Preferred Stock were allocated to
participants in both 1993 and 1992, and will be allocated to
participants each year thereafter until 1998. The year-end market
value of the shares released during 1993 and 1992 was $98.3 million
and $90.7 million, respectively. A portion of the 116,667 shares will
be used to satisfy dividends on previously allocated Preferred Stock.
The remaining shares will be allocated to each participant's Penney
Preferred Stock Account in accordance with the ratio that each
participant's deposits, not in excess of 6% of earnings ("matched
deposits"), bear to all such deposits by participants for the
applicable Plan year. The value of the 1993 allocation to participants
was equal to 93% of matched deposits versus 74% in 1992.
(Continued)
<PAGE>
2
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Notes to Financial Statements
If the total value of Preferred Stock released for allocation in any
year is less than the sum of (i) 4-1/2% of available profits (as
defined in the Plan document) and (ii) the dividends on previously
allocated Preferred Stock, the Company is required to make an
additional contribution in cash or shares of J. C. Penney Company,
Inc. common stock ("Common Stock") to the Plan which will be deposited
to the Penney Stock Company Account. The additional Company
contribution, if any, is allocated to participants based on their
matched deposits in the same manner as described above.
(c) Participants' Accounts
----------------------
Participants' account balances are invested in the Plan's investment
programs in accordance with their elections. These investment programs
include the Penney Stock Account (consisting of investments in J. C.
Penney, Inc. common stock), the S & P 500 Account (consisting of
investments in commingled equity funds), and the Interest Income
Account (consisting of contracts with insurance companies and
structured investment contracts, which provide a specific interest
rate for a specified period of time). Each of these funds are
maintained on a unit value basis and, accordingly, the actual earnings
and appreciation or depreciation in the underlying securities are
reflected in the daily unit value.
(d) Vesting
-------
Participants are immediately vested in their contributions and
earnings thereon. Vesting in the Company Accounts is graduated at 20%
per full year of service up to 100% after the earlier of 5 years of
service, normal retirement age, death, or total disability.
Participants who separate from service prior to full vesting of their
rights forfeit the unvested balance of their Company Accounts.
(e) Payment of Benefits
-------------------
Benefits remain in the plan until the participant elects payment. The
normal form of payment is a lump sum settlement (cash and/or shares of
Common Stock). In lieu of a lump sum settlement, a retiring
participant who has attained age 55 with 15 years of Plan service or
over age 65 may elect an indefinite deferral of their balances (if at
least $3,500) or elect an optional annuity for life or installment
payments for a specified period of time. Participants in deferred
status may request periodic withdrawals, fixed monthly payments of at
least $100 or a complete distribution. Minimum distributions will be
made in the year the participant attains age 70 and each year
thereafter to comply with Federal law.
(f) Loans to Participants
---------------------
Loans may be made available to participants upon their request. All
loans must be adequately secured and bear interest at a reasonable
rate. Loan amounts and the term of repayment are limited in accordance
with Plan provisions.
(Continued)
<PAGE>
3
J.C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Notes to Financial Statements
(2) Investments
-----------
Investments in securities are stated at fair value using quoted market
prices. The fair value of the Preferred Stock, which is not publicly traded,
is determined to be the greater of its issue price of $600 per share or the
Common Stock price into which it can be converted. The Common Stock is
widely traded. Funds with insurance companies are recorded at contract value
as reported to the Plan by each insurance company. Each contract is credited
with earnings and charged for withdrawals. The Plan also invests in
structured investment contracts. Under these arrangements, the Plan enters
into a wrap agreement with a financial institution at a stated yield on fixed
income securities purchased by the Plan. The wrap agreements are stated at
fair value based on fluctuations in the fair value of the underlying fixed
income securities. The average cost method is used to calculate gains and
losses on the sale of investments on a trade date basis. Except for certain
funds with insurance companies, the Plan's investments are held by the
trustee, State Street Bank and Trust Company.
The Preferred Stock is convertible into Common Stock at a ratio of 1:20.
Each 1/20 of a share of Preferred Stock has a minimum value of $30. The
Company has the option of settling a participant's Penney Preferred Stock
Account in cash or whole shares of the Common Stock derived from the
conversion of the Preferred Stock to Common Stock, or any combination
thereof, if the market price of Common Stock at the time of distribution is
equal to or less than the conversion value of $600 per share of the Preferred
Stock. However, if the participant requests settlement of such account in
shares, the participant will receive shares of the Common Stock derived from
the conversion of the Preferred Stock to Common Stock. A participant's
Penney Preferred Stock Account will be settled with the Common Stock derived
from the conversion of the Preferred Stock to Common Stock if the market
price of Common Stock exceeds the conversion value of $600 per share of the
Preferred Stock. The annual dividend on the Preferred Stock is 7.9%, payable
semiannually on January 1 and July 1.
On March 10, 1993, the Company declared a two-for-one Common Stock split in
the form of a stock dividend payable May 1, 1993 to stockholders of record on
April 12, 1993. The shares of Common Stock disclosed in the financial
statements and notes thereto have been adjusted for this stock split, as has
the Preferred Stock conversion ratio.
(Continued)
<PAGE>
4
J.C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Notes to Financial Statements
The following table presents the values of investments that represent 5% or
more of the Plan's net assets:
<TABLE>
<CAPTION>
December 31, 1993 December 31, 1992
------------------------------ ----------------------------
Shares, units Fair value/ Shares, units Fair value/
or principal contract or principal contract
Investments amount value amount value
- - - --------------------------- ------------- ------------- ------------ -----------
<S> <C> <C> <C> <C>
Investments, at fair value:
J. C. Penney Company, Inc.
common stock 6,182,647 $ 325,361,798 4,682,294 $181,976,674
J. C. Penney Company, Inc.
preferred stock 1,082,112 1,138,922,612 1,110,952 863,615,633
============== ============
</TABLE>
The number of units and net asset value per unit at December 31, 1993 and
1992 follows:
<TABLE>
<CAPTION>
December 31, 1993 December 31, 1992
-------------------------- --------------------------
Net asset Net asset
Units value Units value
----------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
Penney Common Stock Account 135,838,744 $2.417959 105,141,324 $1.738746
Penney Preferred Stock Account 209,348,497 2.498093 182,451,333 1.743517
S & P 500 Account 28,333,109 1.943240 23,311,290 1.764814
Interest Income Account* 208,987,834 1.504741 195,919,574 1.403399
</TABLE>
* Units are not assigned to participants' loans receivable.
The net asset value for the Penney Preferred Stock Account is based on the
value of the Penney Preferred Stock allocated to participants, excluding
forfeitures, as of December 31, 1993 and 1992.
(3) Loan Payable
------------
The Plan borrowed $700 million in August 1988, through a term loan
agreement obtained by private placement with several financial institutions.
The loan is guaranteed by the Company and the proceeds were used to purchase
the Preferred Stock issued by the Company. The loan agreement specifies
semiannual principal and interest payments of $51.2 million on January 1 and
July 1, with the final installment due in 1998. The loan bears interest at
8.17%.
(Continued)
<PAGE>
5
J.C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Notes to Financial Statements
(4) Plan Termination
----------------
While the Company presently has no intention to do so, it reserves the
right to terminate the Plan and the related J. C. Penney Company, Inc.
Savings, Profit-Sharing and Stock Ownership Plan Trust (the "Trust") at any
time subject to the provisions of ERISA. In the event of Plan termination,
participants will become fully vested in amounts allocated to their Company
accounts.
(5) Tax Status
----------
The Plan obtained its determination letter on August 23, 1993 in which the
Internal Revenue Service ("Service") stated that the Plan as then designed,
was in compliance with the applicable qualification requirements of the
Internal Revenue Code ("Code"). The Plan has been amended subsequent to
receiving the determination letter; however, the Plan administrator believes
that the Plan is currently designed and being operated in compliance with the
applicable requirements of the Code. Therefore, the Plan administrator
believes that the Plan was qualified and the related trust was tax-exempt as
of the date of the financial statements.
(Continued)
<PAGE>
6
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Notes to Financial Statements
(6) Allocation of Plan Assets and Liabilities to Investment Programs:
----------------------------------------------------------------
<TABLE>
<CAPTION>
December 31, 1993
-----------------------------------------------------------------------------------------
Penney Preferred
Stock Account Interest
Penney Common -------------------------- S & P 500 Income
Total Stock Account Unallocated Allocated Account Account
------- ------------- ----------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Assets:
Investments, at fair value:
J. C. Penney Company, Inc.
common stock - 6,182,647
shares (cost $219,409,375) $ 325,361,798 325,361,798 -- -- -- --
J. C. Penney Company, Inc.
preferred stock -
1,082,112 shares (cost
$649,267,042) 1,138,922,612 -- 613,958,398 524,964,214 -- --
State Street Bank Index Fund -
786,756 units (cost $43,391,017) 54,754,297 -- -- -- 54,754,297 --
State Street Bank Liquidity Fund
(cost approximates fair value) 15,519,787 5,046,421 -- 85,688 -- 10,387,679
Funds held under structured
investment contracts:
U.S. agency backed collateralized
mortgage obligations
(cost $181,202,290) 185,852,394 -- -- -- -- 185,852,394
Government trust certificates
(cost $10,545,346) 10,389,891 -- -- -- -- 10,389,891
Wrap agreements (cost $1,449,420) (2,835,741) -- -- -- -- (2,835,741)
Participants' loans (unpaid
principal balance
approximates fair value) 31,426,436 -- -- -- -- 31,426,436
Funds with insurance companies,
at contract value 109,223,830 -- -- -- -- 109,223,829
-------------- ----------- ----------- ----------- ---------- -----------
Total investments 1,868,615,304 330,408,219 613,958,398 525,049,902 54,754,297 344,444,488
Receivables:
Due from J. C. Penney
Company, Inc. 600,034 104,765 -- 402,276 16,091 76,902
Accrued interest and dividends 9,031 4,045 -- 4,494 -- 492
-------------- ----------- ----------- ----------- ---------- -----------
Total assets 1,869,224,369 330,517,029 613,958,398 525,456,672 54,770,388 344,521,882
-------------- ----------- ----------- ----------- ---------- -----------
Liabilities:
Cash overdraft 1,334 3,300 -- (1,725) (241) --
Loan payable 413,752,773 -- 413,752,773 -- -- --
Accrued interest payable 16,901,801 -- 16,901,801 -- -- --
Due to broker 2,861,912 2,861,912 -- -- -- --
Accounts payable and other
liabilities 924,871 170,215 -- 196,904 68,775 488,977
Inter-fund balances -- 88,155 -- 130,597 (88,134) (130,618)
-------------- ----------- ----------- ----------- ---------- -----------
Total liabilities 434,442,691 3,123,582 430,654,574 325,776 (19,600) 358,359
-------------- ----------- ----------- ----------- ---------- -----------
Net assets available
for benefits $1,434,781,678 327,393,447 183,303,824 525,130,896 54,789,988 344,163,523
============== =========== =========== =========== ========== ===========
Figures Rounded
</TABLE>
(Continued)
<PAGE>
7
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Notes to Financial Statements
<TABLE>
<CAPTION>
(6) Allocation of Plan Assets and Liabilities to Investment Programs, Continued:
---------------------------------------------------------------------------
December 31, 1992
---------------------------------------------------------------------------------
Penney Preferred
Stock Account Interest
Penney Common ------------------------ S & P 500 Income
Total Stock Account Unallocated Allocated Account Account
----- ------------- ----------- --------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Assets:
Investments, at fair value:
J. C. Penney Company, Inc. common
stock - 4,682,294 shares
(cost $133,479,935) $ 181,976,674 181,976,674 -- -- -- --
J. C. Penney Company, Inc. preferred
stock - 1,110,952 shares
(cost $666,571,103) 863,615,633 -- 544,250,043 319,365,590 -- --
State Street Bank Index Fund - 649,336
units (cost $32,518,467) 41,064,629 -- -- -- 41,064,629 --
State Street Bank Liquidity Fund (cost
approximates fair value) 10,459,308 4,920,000 -- 106,000 -- 5,433,308
Funds held under structured investment
contracts:
U.S. agency backed collateralized
mortgage obligations (cost $121,951,055) 122,888,630 -- -- -- -- 122,888,630
Wrap agreements (cost $508,148) (264,038) -- -- -- -- (264,038)
Participants' loans (unpaid principal
balance approximates fair value) 21,034,934 -- -- -- -- 21,034,934
Funds with insurance companies, 146,124,378 -- -- -- -- 146,124,378
at contract value -------------- ----------- ----------- ----------- ---------- -----------
Total investments 1,386,900,148 186,896,674 544,250,043 319,471,590 41,064,629 295,217,212
-------------- ----------- ----------- ----------- ---------- -----------
Receivables:
Due from J. C. Penney Company, Inc. 432,403 116,024 -- 96,714 64,902 154,763
Accrued interest and dividends 28,157 8,139 -- 4,528 -- 15,490
-------------- ----------- ----------- ----------- ---------- -----------
460,560 124,163 -- 101,242 64,902 170,253
-------------- ----------- ----------- ----------- ---------- -----------
Total assets 1,387,360,708 187,020,837 544,250,043 319,572,832 41,129,531 295,387,465
-------------- ----------- ----------- ----------- ---------- -----------
Liabilities:
Cash overdraft 6,885 10,310 -- (1,951) (1,474) --
Loan payable 478,416,565 -- 478,416,565 -- -- --
Accrued interest payable 19,543,316 -- 19,543,316 -- -- --
Due to broker 3,473,000 3,473,000 -- -- -- --
Accounts payable and other liabilities 268,193 35,570 -- 19,442 26,454 186,727
Inter-fund balances -- 683,968 -- 125,160 (52,223) (756,905)
-------------- ----------- ----------- ----------- ---------- -----------
Total liabilities 501,707,959 4,202,848 497,959,881 142,651 (27,243) (570,178)
-------------- ----------- ----------- ----------- ---------- -----------
Net assets available for benefits $ 885,652,749 182,817,989 46,290,162 319,430,181 41,156,774 295,957,643
============== =========== =========== =========== ========== ===========
(Continued)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
8
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Notes to Financial Statements
(7) Allocation of Plan Income and Changes in Plan Equity to Investment Programs:
---------------------------------------------------------------------------
December 31, 1993
-------------------------------------------------------------------------------------
Penney Preferred
Stock Account Interest
Penney Common ----------------------- S & P 500 Income
Total Stock Account Unallocated Allocated Account Account
-------------- ------------- ----------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation in fair value
of investments $ 383,304,270 77,339,508 139,706,254 161,766,384 4,492,124 --
Interest 22,418,814 113,124 -- 15,153 5,451 22,285,086
Dividends 60,089,452 7,769,435 52,320,017 -- -- --
-------------- ----------- ----------- ----------- ---------- -----------
465,812,536 85,222,067 192,026,271 161,781,537 4,497,575 22,285,086
Less investment expenses (108,768) -- -- -- -- (108,768)
-------------- ----------- ----------- ----------- ---------- -----------
465,703,768 85,222,067 192,026,271 161,781,537 4,497,575 22,176,318
-------------- ----------- ----------- ----------- ---------- -----------
Contributions:
J. C. Penney Company, Inc. 50,136,087 -- 50,136,087 -- -- --
Participants 149,384,249 60,206,320 -- -- 17,159,021 72,018,908
-------------- ----------- ----------- ----------- ---------- -----------
199,520,336 60,206,320 50,136,087 -- 17,159,021 72,018,908
-------------- ----------- ----------- ----------- ---------- -----------
Total additions 665,224,104 145,428,387 242,162,358 161,781,537 21,656,596 94,195,226
-------------- ----------- ----------- ----------- ---------- -----------
Transfer of preferred stock at cost
(116,667 shares) -- -- 70,000,000 (70,000,000) -- --
Deductions from net assets attributed to:
Benefit payments 80,885,198 26,200,584 -- 22,093,777 6,307,652 26,283,185
Interest expense 35,150,796 -- 35,150,796 -- -- --
Deferral fees 59,181 5,385 -- 536 1,496 51,764
Participants' transfers -- (25,353,040) (2,100) 3,986,509 1,714,234 19,654,397
-------------- ----------- ----------- ----------- ---------- -----------
Total deductions 116,095,175 852,929 105,148,696 (43,919,178) 8,023,382 45,989,346
-------------- ----------- ----------- ----------- ---------- -----------
Change in net assets available for
benefits 549,128,929 144,575,458 137,013,662 205,700,715 13,633,214 48,205,880
Beginning net assets available for
benefits 885,652,749 182,817,989 46,290,162 319,430,181 41,156,774 295,957,643
-------------- ----------- ----------- ----------- ---------- -----------
Ending net assets available for benefits $1,434,781,678 327,393,447 183,303,824 525,130,896 54,789,988 344,163,523
============== =========== =========== =========== ========== ===========
(Continued)
</TABLE>
<PAGE>
9
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND
STOCK OWNERSHIP PLAN
Notes to Financial Statements
<TABLE>
<CAPTION>
(7) Allocation of Plan Income and Changes in Plan Equity to Investment Programs, Continued:
--------------------------------------------------------------------------------------
Year ended December 31, 1992
-------------------------------------------------------------------------------------------
Penney Preferred
Stock Account Interest
Penney Common ----------------------------- S & P 500 Income
Total Stock Account Unallocated Allocated Account Account
------------- ------------- ----------------- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation in
fair value of investments $251,709,113 49,221,538 124,249,774 75,383,167 2,854,634 --
Interest 20,115,919 53,871 -- 18,937 9,030 20,034,081
Dividends 59,453,175 5,728,441 53,724,734 -- -- --
------------ ----------- ----------- ----------- ---------- -----------
331,278,207 55,003,850 177,974,508 75,402,104 2,863,664 20,034,081
Less investment expenses (52,916) -- -- -- -- (52,916)
------------ ----------- ----------- ----------- ---------- -----------
331,225,291 55,003,850 177,974,508 75,402,104 2,863,664 19,981,165
------------ ----------- ----------- ----------- ---------- -----------
Contributions:
J. C. Penney Company, Inc. 48,731,483 -- 48,731,483 -- -- --
Participants 137,291,537 46,572,318 -- -- 14,332,937 76,386,282
------------ ----------- ----------- ----------- ---------- -----------
186,023,020 46,572,318 48,731,483 -- 14,332,937 76,386,282
------------ ----------- ----------- ----------- ---------- -----------
Total additions 517,248,311 101,576,168 226,705,991 75,402,104 17,196,601 96,367,447
------------ ----------- ----------- ----------- ---------- -----------
Transfer of preferred
stock at cost (116,667 shares) -- -- 70,000,000 (70,000,000) -- --
Deductions from net assets attributed to:
Benefit payments 74,753,224 20,971,119 -- 16,792,767 5,295,604 31,693,734
Interest expense 40,330,157 -- 40,330,157 -- -- --
Deferral fees 22,451 1,265 -- 357 165 20,664
Participants' transfers -- 12,163,960 -- 3,993,424 (1,571,266) (14,586,118)
------------ ----------- ----------- ----------- ---------- -----------
Total deductions 115,105,832 33,136,344 110,330,157 (49,213,452) 3,724,503 17,128,280
------------ ----------- ----------- ----------- ---------- -----------
Change in net assets
available for benefits 402,142,479 68,439,824 116,375,834 124,615,556 13,472,098 79,239,167
Beginning net assets
available for benefits 483,510,270 114,378,165 (70,085,672) 194,814,625 27,684,676 216,718,476
------------ ----------- ----------- ----------- ---------- -----------
Ending net assets
available for benefits $885,652,749 182,817,989 46,290,162 319,430,181 41,156,774 295,957,643
============ =========== =========== =========== ========== ===========
</TABLE>
<PAGE>
Schedule 1
----------
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND STOCK OWNERSHIP PLAN
Item 27a - Schedule of Assets Held for Investment Purposes
as of December 31, 1993
<TABLE>
<CAPTION>
Description of
Identity of issue asset Cost Current value
----------------- -------------- ---- -------------
<S> <C> <C> <C>
J. C. Penney Company, Inc. Common stock, $219,409,375 325,361,798
6,182,647 shares ------------ -------------
J. C. Penney Company, Inc. Preferred stock, 649,267,042 1,138,922,612
1,082,112 shares ------------ -------------
State Street Bank Index Fund, 43,391,017 54,754,297
786,756 units ------------ -------------
State Street Bank Liquidity Fund, 15,519,787 15,519,787
15,519,787 units ------------ -------------
Bankers Trust (Delaware) FHLMC backed CMO 30,614,332 31,406,720
6.00% - matures
12/15/11
Union Bank of Switzerland FHLMC backed CMO 35,682,829 36,268,750
7.00% - matures
7/15/04
Union Bank of Switzerland FHLMC backed CMO 13,725,538 13,436,494
5.20% - matures
1/15/11
Union Bank of Switzerland FHLMC backed CMO 5,065,039 4,951,550
5.10% - matures
11/15/01
Peoples Security Life FHLMC backed CMO 24,900,333 26,008,060
Insurance 5.50% - matures
3/15/15
Bankers Trust (Delaware) FNMA backed CMO 21,857,632 22,171,820
5.90% - matures
12/25/99
Peoples Security Life FNMA backed CMO 49,356,587 51,609,000
Insurance 7.00% - matures ------------ -------------
11/25/14
Total U.S. agency backed CMO's 181,202,290 185,852,394
------------ -------------
Bankers Trust (Delaware) Government trust
certificate zero
coupon -
matures 11/15/97 2,907,997 2,865,128
Bankers Trust (Delaware) Government trust
certificate zero
coupon -
matures 11/15/97 3,018,079 2,973,588
Bankers Trust (Delaware) Government trust
certificate zero
coupon -
matures 11/15/97 2,084,884 2,054,150
Bankers Trust (Delaware) Government trust
certificate zero
coupon -
matures 11/15/97 2,189,129 2,156,858
Bankers Trust (Delaware) Government trust
certificate zero
coupon -
matures 11/15/97 345,257 340,167
------------ -------------
Total government trust certificates 10,545,346 10,389,891
------------ -------------
(Continued)
</TABLE>
<PAGE>
2 Schedule 1, Cont.
-----------------
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND STOCK OWNERSHIP PLAN
Item 27a - Schedule of Assets Held for Investment Purposes
as of December 31, 1993, Continued
<TABLE>
<CAPTION>
Description
Identity of issue of asset Cost Current value
----------------- ----------- ---- -------------
<S> <C> <C> <C>
Bankers Trust (Delaware) Wrap agreement $ 244,067 (479,859)
6.00% - matures
12/15/11
Bankers Trust (Delaware) Wrap agreement 13,611 117,898
zero coupon
- matures 11/15/97
Bankers Trust (Delaware) Wrap agreement 14,104 117,519
zero coupon
- matures 11/15/97
Bankers Trust (Delaware) Wrap agreement 9,765 85,847
zero coupon
- matures 11/15/97
Bankers Trust (Delaware) Wrap agreement 10,258 91,220
zero coupon
- matures 11/15/97
Bankers Trust (Delaware) Wrap agreement 1,578 5,691
zero coupon
- matures 11/15/97
Bankers Trust (Delaware) Wrap agreement 166,375 (147,080)
5.90% -
matures 12/25/99
Union Bank of Switzerland Wrap agreement 579,600 (451,436)
7.00% -
matures 7/15/04
Union Bank of Switzerland Wrap agreement 133,418 333,524
5.20% -
matures 1/15/11
Union Bank of Switzerland Wrap agreement 48,688 128,518
5.10% -
matures 11/15/01
Peoples Security Life Wrap agreement 76,179 (776,928)
Insurance 5.50% -
matures 3/15/15
Peoples Security Life Wrap agreement 151,777 (1,860,655)
Insurance 7.00% - matures -------------- -------------
11/25/14
Total wrap agreements 1,449,420 (2,835,741)
-------------- -------------
Participants' loans Interest rates 31,426,436 31,426,436
ranging from -------------- -------------
9.25% to 12.5%
Aetna Life Insurance 8.70% - matures on 7,193,036 7,193,036
Company 3/31, 6/30, 9/30,
12/31 of 1994
Allstate Life Insurance 8.75% - matures 26,258,166 26,258,166
Company 12/30/96
Metropolitan Life 8.55% - matures on 18,036,888 18,036,888
Insurance Company 6/30, 12/31 of 1994
and 1995
Provident Life & Accident 4.58% - matures 22,164,363 22,164,363
Insurance Company 3/27/97
Prudential Asset 7.86% - matures 27,251,081 27,251,081
Management Company 6/30/95
Southland Life 5.75% - matures 8,320,296 8,320,296
1/21/99 -------------- -------------
Total investment contracts with
insurance companies 109,223,830 109,223,830
-------------- -------------
Total investments $1,261,435,543 1,868,615,304
============== =============
</TABLE>
See accompanying independent auditors' report.
<PAGE>
<TABLE>
<CAPTION>
Schedule 2
----------
J. C. PENNEY COMPANY, INC.
SAVINGS, PROFIT-SHARING AND STOCK OWNERSHIP PLAN
Item 27d - Schedule of Reportable Transactions
Year ended December 31, 1993
Expense Current value
Aggregate incurred of asset on Net
Identity Description number of Purchase Selling Lease with Cost of transaction gain
of issue of asset transactions price price rental transactions asset date (loss)
- - - ---------- ------------ ------------ ---------- -------- ------ -------------- ------- ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Purchases:
J. C. Penney
Company,
Inc. Common stock 368 $108,023,918 -- -- -- 108,023,918 108,023,918 --
J. C. Penney
Company,
Inc. Preferred stock 182 71,427,273 -- -- -- 71,427,273 71,427,273 --
Sales:
J. C. Penney
Company,
Inc. Common stock 213 -- 36,833,715 -- -- 31,287,475 36,833,715 5,546,240
J. C. Penney
Company,
Inc. Preferred stock 294 -- 88,459,093 -- -- 82,985,445 88,459,093 5,473,648
</TABLE>
See accompanying independent auditors' report.
<PAGE>
INDEPENDENT AUDITORS' CONSENT
-----------------------------
The J. C. Penney Company, Inc.
Associate Benefits Committee,
Benefit Plans Investment Committee,
Retirement Plans Committee, and the
Benefits Plans Review Committee:
We consent to incorporation by reference in the registration statement (No.
33-59666) on Form S-8 of J. C. Penney Company, Inc. of our report dated May
13, 1994 relating to the statements of net assets available for benefits of the
J. C. Penney, Inc. Savings, Profit-Sharing and Stock Ownership Plan as of
December 31, 1993 and 1992, and the related statements of changes in net assets
available for benefits and related schedules for the years then ended, which
report appears in the December 31, 1993 annual report on Form 11-K of the J. C.
Penney Company, Inc. Savings, Profit-Sharing and Stock Ownership Plan.
/s/ KPMG Peat Marwick
Dallas, Texas
June 27, 1994
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the Plan) have duly caused this
annual report to be signed by the undersigned thereunto duly authorized.
SAVINGS, PROFIT-SHARING AND STOCK OWNERSHIP PLAN
By: /s/ T. A. CLERKIN
-----------------------------
T. A. Clerkin
Member of Retirement Plans Committee
Date: June 27, 1994
