Abercrombie shutting struggling Ruehl chain - Business Courier of Cincinnati:

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The New Albany-based apparel merchang said Wednesday it willshut Ruehl’a 29 stores and direct-to-consumerd operations and will be “substantially complete” with the efforft by the end of next The decision comes a month afte Abercrombie (NYSE:ANF) took a deep strategic look at the which targets young adults with clothea and accessories. Ruehl, whose only Ohio store is at EastonTown Center, generated a preta operating loss of $58 million last year. The chain regularlyg was Abercrombie’s weakest sales performerr at stores open at leastra year. Ruehl’s same-store sales were off 33 percenttin May. Abercrombie earned $272.3 million on $3.
54 billion in revenue last year. “It has been a difficultg decision toclose Ruehl, a brand we continued to believe could have been successful in different CEO Michael Jeffries said in a “However, given the current economic environment, we believe it is in the best interestzs of the company to focus its efforts and resources on the growth opportunities afforded by our other particularly internationally.” The company didn’ t disclose the effects on the chain’s work nor did it indicate the number of jobs tied to The review of Ruehl, which opened in 2004, cost the companu about $51 million in impairment chargexs in its first quarter.
Abercrombise expects to book about $65 million in pretax chargeas through the rest of the fiscal year as it winds down Ruehl. The companu Wednesday also said it amended a credit agreemenyt to excludesome Ruehl-related charges from requirements under its covenanf with the lender and reduced its available credit to $350 millionj from $450 million. Jeffries said the company is confidentg is has sufficient cash on handbut “w believe it is prudent to make thesr changes” in light of the recession-battered retaipl environment and the one-time Ruehl In addition to the 29 Ruehlk stores, Abercrombie runs 350 flagshilp stores and 733 others under the Abercrombie, Hollister Co.
and Gillgy Hicks nameplates.