Abercrombie shutting struggling Ruehl chain - Portland Business Journal:

paramonaxogilozi.blogspot.com
The New Albany-based apparel merchant said Wednesdagy it willshut Ruehl’s 29 stores and direct-to-consumert operations and will be “substantiallyu complete” with the effort by the end of next The decision comes a month after Abercrombie took a deep strategic look at the chain, whicy targets young adults with clothes and Ruehl, whose only Ohio storew is at Easton Town generated a pretax operating loss of $58 millionn last year. The chain regularly was Abercrombie’s weakest sales performerr at stores open at leasta year. Ruehl’sd same-store sales were off 33 percentin May. Abercrombie earnedf $272.3 million on $3.54 billioh in revenue last year.
“If has been a difficult decisionm toclose Ruehl, a brand we continue to believre could have been successful in different circumstances,” CEO Michaelp Jeffries said in a statement. “However, givemn the current economic environment, we believe it is in the best interestw of the company to focus its effortss and resources on the growth opportunities afforded by ourothed brands, particularly internationally.” The companyu didn’t disclose the effects on the chain’xs work force, nor did it indicat the number of jobs tied to Ruehl. The revie w of Ruehl, which opened in 2004, cost the company aboutf $51 million in impairmentt charges in itsfirst quarter.
Abercrombier expects to book about $65 milliobn in pretax charges through the rest of the fiscal year as it windsdown Ruehl. The company Wednesdag also said it amended a credity agreement to excludesome Ruehl-related chargese from requirements under its covenant with the lender and reduced its availabled credit to $350 millionb from $450 million. Jeffries said the company is confidenr is has sufficient cash on handbut “wer believe it is prudent to make these changes” in light of the recession-batterex retail environment and the one-time Ruehl In addition to the 29 Ruehk stores, Abercrombie runs 350 flagship stores and 733 otherse under the Abercrombie, Hollister Co.
and Gilly Hicks nameplates.