UPDATE 1-J.C. Penney CEO sees return to growth this year -CNBC

Wed Feb 6, 2013 1:27pm EST
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* Says will "self-fund" next steps in transformation

* Says more important to draw in new younger and more affluent shoppers

* Still on pace to open 30 boutiques this year

* Shares down 3.5 percent (Adds quotes from CNBC interview, background)

By Phil Wahba

Feb 6 (Reuters) - J.C. Penney Co Inc Chief Executive Ron Johnson still thinks the department store operator will return to growth in 2013 despite severe sales declines in fiscal 2012, he told CNBC in an interview on Wednesday.

Penney, which operates 1,100 department stores, began a turnaround a year ago that called for the elimination of most coupons and sales events, along with a four-year transformation of its 700 largest stores into a collection of 100 shops in each store for brands like Levi's and PVH Corp's Izod.

"I believe we will return to growth this year," Johnson said.

Sales collapsed 23.1 percent in the first nine months of the fiscal year as long-term customers, trained for years to seek out discounts, balked at the pricing strategy.   Continued...