Christopher & Banks Corp. plans to close about 100 of its 761 stores and adjust the cost structure of its remaining doors to improve productivity.
The closures are expected to rack up pretax expenses of $12 million to $16 million over the next three quarters. Along with a $2 million impairment charge associated with the remaining store base, the company expects to record store-related aftertax charges of 39 cents to 49 cents a share over the next nine months.
Analysts already expected the company to post losses of $1.07 a share this year and investors applauded the move and pushed the stock up 6 percent to $3.01.
“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 Larry Barenbaum, president and chief executive officer. “We anticipate that these initiatives will help us to both improve overall store productivity and support our return to profitability.”
The Minneapolis-based women’s apparel retailer also laid off 7 percent of its headquarters staff and 13 percent of its store operating field management team last month. The firm, which, as of April, had 1,700 full-time employees and 4,700 part-time employees, expects the reductions to save about $2.2 million in annual expenses. The layoffs will result in a charge of 1 cent a diluted share during the third quarter.