Lisa Harper marked the end of her first week as chief executive officer of Hot Topic Inc. with a series of changes at the troubled teen retail chain, including the elimination of its ShockHound.com site and the removal of the chief merchant of the Hot Topic division.
Harper, a company director and former Gymboree Corp. ceo named to succeed longtime ceo Betsy McLaughlin last Monday, will assume oversight responsibility for Hot Topic merchandising from Amy Kocourek, previously the division’s chief merchandising officer, who has left the firm.
ShockHound.com, a music site launched in late 2008, was designed to appeal to the musical aesthetic of the Hot Topic customer in the wake of its heady but unsustanined success as a licensee for the film “Twilight.”
Hot Topic will take pretax charges to cover these moves, writedowns of unproductive inventory and of nonessential fixed assets and costs related to its ceo transition of $15 million, translating to 21 cents a diluted share. Excluding these costs, and based on expectations of a low-single-digit decline in same-store sales, the company expects to post a loss of between 1 cent and 4 cents a diluted share in the first quarter ending next month.
Joining a large and growing group of teen retailers, the City of Industry, Calif.-based chain said it would discontinue the reporting of monthly sales following the end of the second quarter. Beginning with the third quarter, it will report quarterly sales on the Wednesday following the end of each fiscal quarter.
Abercrombie & Fitch Co., American Eagle Outfitters Inc. and Aéropostale Inc. ceased reporting monthly sales at the end of the fiscal year in January.