The Spiegel Group announced its intent to close 60 under-performing Eddie Bauer stores as an integral part of a multi-phase reorganization process. These stores will remain open for business pending approval of the store- closing plan by the Bankruptcy Court and thereafter, on a store-by-store basis, until the related store-closing inventory sales are completed.
Closing these under-performing stores is expected to improve Eddie Bauer’s financial results in fiscal 2003 and going forward. The company will assess inventory writedowns, if any, associated with these store closings on a going forward basis.
Bill Kosturos, interim chief executive officer and chief restructuring officer of The Spiegel Group said, “The decision to close stores is never easy, yet we are confident that this move will result in a healthier, more productive store base for Eddie Bauer as we eliminate the least productive stores and concentrate our efforts on boosting store productivity.”
Fabian Mansson, president and chief executive officer of Eddie Bauer stated, “We are taking tough, but necessary steps to position Eddie Bauer for future success. Our refined base of Eddie Bauer stores will operate as usual as we continue to deliver outstanding customer service and provide a compelling merchandise offer that reflects Eddie Bauer’s heritage of quality, innovative, outdoor-inspired products. As always, we appreciate the continuing support of our loyal customers and dedicated associates as we work to strengthen our business.”
Eddie Bauer currently operates 529 stores in the United States and Canada, including 382 apparel stores, 45 home stores and 102 outlet stores. The stores targeted for closure include 51 apparel stores, eight home stores and one outlet store, which are located throughout the United States.
The company also is seeking Court approval to extend the time allowed to reject executory contracts. The company expects to continue to evaluate the financial performance of Eddie Bauer stores and make decisions going forward regarding the possibility of additional store closures.
