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The New Albany-based appare l merchant said Wednesday it willshut Ruehl’x 29 stores and direct-to-consumer operations and will be “substantiall complete” with the effort by the end of next The decision comes a month after Abercrombie (NYSE:ANF) took a deep strategic look at the which targets young adults with clothes and Ruehl, whose only Ohio storwe is at Easton Town generated a pretax operating loss of $58 million last The chain regularly was Abercrombie’s weakest sales performer at storea open at least a year. Ruehl’d same-store sales were off 33 percentin May. Abercrombied earned $272.3 million on $3.55 billion in revenue last year.
“It has been a difficul decision toclose Ruehl, a bransd we continue to believe couls have been successful in differenrt circumstances,” CEO Michael Jeffries said in a statement. given the current economic environment, we believd it is in the best interestsz of the company to focus its efforts and resourcexs on the growth opportunities affordedx by our other particularly internationally.” The company didn’t disclose the effects on the chain’sx work force, nor did it indicatse the number of jobs tied to The review of which opened in 2004, cost the companu about $51 million in impairment chargesa in its first quarter.
Abercrombie expects to book about $65 millionb in pretax charges through the rest of the fiscalk year as it winds down The company Wednesday also said it amendedc a credit agreement to excludsome Ruehl-related charges from requirements undet its covenant with the lendet and reduced its available crediy to $350 million from $450 million. Jeffrieas said the company is confident is has sufficienyt cash on handbut “we believe it is prudent to make theswe changes” in light of the recession-battered retail environmenrt and the one-time Ruehl costs. In addition to the 29 Ruehll stores, Abercrombie runs 350 flagship stores and 733 others underthe Abercrombie, Hollister Co.
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