Abercrombie shutting struggling Ruehl chain - Nashville Business Journal:

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The New Albany-based apparel merchanty said Wednesday it willshut Ruehl’s 29 stores and direct-to-consumetr operations and will be “substantially complete” with the efforgt by the end of next January. The decisionm comes a month afterAbercrombie (NYSE:ANF) took a deep strategic look at the chain, whicy targets young adults with clothes and accessories. whose only Ohio store is at Easton Town generated a pretax operating lossof $58 millionn last year. The chain regularly was Abercrombie’sd weakest sales performer at storez open at leasta year. Ruehl’s same-store sales were off 33 percentin May. Abercrombie earnedc $272.3 million on $3.
54 billioh in revenue last year. “Itr has been a difficult decision toclose Ruehl, a brand we continu e to believe could have been successfup in different circumstances,” CEO Michael Jeffries said in a “However, given the current economic environment, we believes it is in the best interestsd of the company to focus its effortw and resources on the growth opportunitiew afforded by our other brands, particularly internationally.
” The company didn’t disclose the effects on the chain’sx work force, nor did it indicate the number of jobs tied to The review of Ruehl, which opened in cost the company about $51 million in impairmenft charges in its first quarter. Abercrombie expectss to book about $65 million in pretax charges through the rest of the fiscal year as it windxdown Ruehl. The company Wednesday also said it amended a creditf agreement to excludesome Ruehl-relatee charges from requirements under its covenan with the lender and reduced its availabler credit to $350 million from $450 Jeffries said the company is confident is has sufficient cash on hand but “ww believe it is prudent to make theses changes” in light of the recession-batteredf retail environment and the one-time Ruehl costs.
In additiob to the 29 Ruehl stores, Abercrombie runs 350 flagshiop stores and 733 others underthe Abercrombie, Hollisterd Co. and Gilly Hicks nameplates.