The Wet Seal Inc. said it will begin winding down the Arden B. brand.
Arden B. operates 54 mall-based stores and an e-commerce site. In the year ended Feb. 1, Arden B. generated net sales of $60.4 million and represented 11 percent of consolidated net sales. At its peak, the operation had as many as 106 doors back in 2004.
John D. Goodman, chief executive officer of Wet Seal, said, “This was a difficult decision that followed a comprehensive review of the business and market dynamics.”
The ceo added that with the “process under way,” the management team and board will focus on growth for the Wet Seal nameplate.
Of the 54 Arden B. sites, 31 will transition to Wet Seal Plus locations and the remaining 23 will become Wet Seal stores. The changes are expected to be completed by the end of July, in time for the back-to-school selling season.
The wind-down is expected to result in annualized pretax cost savings of $1.3 million beginning in the second quarter of fiscal 2014.
The company said it expects to incur $100,000 in charges for severance costs in the first quarter of fiscal 2014 and $300,000 in charges for store employee retention programs in each of the second and third quarters of the fiscal year.
In addition, Wet Seal said it expects noncash asset impairment charges of up to $3 million in the first quarter of 2014, and 2015 is expected to result in $500,000 of payments related to unamortized tenant allowances. The company disclosed that some leases are set to expire, and that it also will exercise early termination provisions where it can.
Wet Seal reiterated prior guidance of a net loss per diluted share of between 16 cents and 19 cents, along with comparable-store sales, including e-commerce, in the negative mid- to high teens. The company will report first-quarter results on May 27.
Brean Capital’s analyst Eric Beder viewed the closing of Arden B. as a positive for the teen retailer, and reiterated his “buy” rating and $2 price target for Wet Seal shares. “We continue to believe in the company’s shift to the fast-fashion model and that the potential for a turn at Wet Seal could be as early as the second quarter,” he said.
Shares of Wet Seal on Friday rose 5 percent to close at $1.25 in Nasdaq trading.
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews
“Stranger Things” is getting a new cast member for season 2. Meet @sadiesink_, the 15-year-old who will be joining the Netflix series for its new season. You may recognize her from “The Glass Castle” with Brie Larson and Woody Harrelson, but the Texas native’s next role goes in an entirely different direction. She describes her character, Max, as “a rough and tumble skater girl [who] becomes friends with the boys at school.” The second season debuts on October 27. (📷: @jgreenery) #wwdeye
Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye