Women apparel retailer Christopher & Banks Corp. (NYSE:CBK) said Friday it has decided to close about 100 underperforming stores to both improve overall productivity and support its return to profitability.
As a result, the company said it estimates pre-tax charges of $12 to $16 million consisting of cash charges of $5 to $7 million and non-cash charges of $7 to $9 million over the next three fiscal quarters.
On an after-tax basis, the charges associated with the store closings and the non-cash impairment charge for existing stores are expected to range in the aggregate from $0.39 to $0.49 per share over the next three fiscal quarters, based on an effective tax rate in the low single digits, it added.
"As part of our go-forward real estate strategy, we also intend to restructure overall occupancy costs at a majority of our remaining stores and to accelerate the conversion of a number of our existing stores to a dual store format, which offers missy, petite and plus sizes under one roof," said chief executive Larry Barenbaum.
As of November 11, 2011, the company operates 761 stores in 45 states.
Christopher & Banks also said it implemented a workforce reduction involving its home office and field management organization, effective Oct. 28. The workforce reduction impacted around 7 percent of the company's corporate headquarters employees, excluding the distribution center, and about 13 percent of its store operations field management team.
Lat month, the company posted a wider net loss for the second quarter on lower sales. Adjusted net loss per share was 22 cents, compared with a loss of 7 cents in the year-ago quarter. Net sales fell to $96.2 million from $101.3 million, while same store sales declined 8 percent.
For the third quarter, the company saw an operating loss in the range of $11 million to $14 million, on flat to a low single digit increase in same store sales.
Minneapolis-based CBK closed Thursday's regular trading session at $2.84. The stock has been trading in the 52-week range between $2.82 and $7.12.