Friday, February 27, 2015

Chico's Closing 120 Stores In Cost Cutting Move

FORT MYERS, FL. -- Chico's FAS, Inc., a clothing retailer based in Fort Myers, Fl. issued a statement Wednesday indicating it's closing 120 clothing stores.

On the other hand for fiscal 2015, the company plans to open approximately 40 new stores, but significantly less than the openings of 125 stores in 2012, 135 stores in 2013, and 109 stores in 2014.

"The Company has also determined to increase the rate of domestic store closures to improve the overall productivity of its store fleet. Under this plan, the Company expects to close approximately 120 stores starting in fiscal 2015 through 2017. These 120 store closings are expected to ultimately result in expense savings of approximately $55.2 million upon completion."

For fiscal 2015, the Chico's plans to close approximately 35 stores.

The company made changes that resulted in the elimination of approximately 240 existing positions, which is expected to result in approximately $38 million of annualized savings. The corporate organizational realignment resulted in a 12% reduction of the Company's headquarters and field management employee base.

Todd Vogensen , Executive Vice President and Chief Financial Officer, Chico's FAS, said, "The changes to the Company's capital allocation and cost reductions announced today were carefully considered to ensure that we continue to operate from a position of strength and drive profitable growth and value creation."

The Company, through its brands – Chico's, White House | Black Market, Soma Intimates, and Boston Proper, is a specialty retailer of women's private branded, casual-to-dressy clothing, intimates, accessories, and other non-clothing items.

As of January 31, 2015, the Company operated 1,547 stores in the US and Canada and sold merchandise through franchise locations in Mexico.

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