Department store retailer JC Penney is planning to increase the rate at which it opens new stores to the highest level since 1980, the company's director of property development told analysts yesterday (19 April).

The company will open 50 new stores yearly from next year until 2009, Michael Dastugue said, and will open 27 new stores this year as opposed to 20 as originally planned.

About 30% will be relocations of current stores, while up to 90% of the stores will be outside of malls in an attempt to draw in new shoppers. About 89% will be in big markets with populations over 1 million.

Penney eyes a minimum of four stores each for Houston, Dallas, Denver, Phoenix, Minneapolis and Chicago. The company will use free cash flow to finance the openings.

Penney plans a total of US$800m capital spending this year, with $350m for new stores and $250m for existing locations.

CFO Robert Cavanaugh predicted an earnings per share growth of about 16% until 2009, with a same-store sales rise in the low single digits.

As well as the aggressive retail growth programme, an increase in internet trading will help boost earnings.