Aeropostale, Inc. plans to close its Jimmy'Z concept, including its 11 Jimmy'Z stores in the second quarter of fiscal 2009.
The decision to take this action resulted from a comprehensive review and evaluation of the current macro-economic condition and the performance of the concept. Company management determined that discontinuing the business would enable the organization to focus on the growth within the core Aeropostale business and the roll out of the Company's next U.S. retail concept which will target a younger demographic.
Julian R. Geiger said, “We sincerely thank everyone in the Jimmy'Z organization for their hard work, commitment and dedication to the brand over the past few years. We believe, however, that discontinuing the Jimmy'Z concept will enable us to focus on businesses which align with our core competencies, and generate greater long-term shareholder value.”
During the first half of fiscal 2009, the company expects to incur approximately $5.0 million of additional pre-tax costs related to lease terminations, inventory liquidation, and employee retention and severance obligations. The company expects an ongoing financial benefit from the elimination of Jimmy'Z annualized operating losses of approximately $8.0 million pre-tax or 7 cents per share.
