JOSEPH CASTLE 2ND APPOINTED CHARMING SHOPPES CHAIRMAN
NEW YORK — Charming Shoppes, which has been downsizing and struggling in the tough retail climate, named Joseph L. Castle 2nd as chairman, succeeding Philip Wachs, who resigned Feb. 9. Castle has served on Charming’s board since January 1990 and continues as chairman and chief executive officer of Castle Energy Corp. in Radnor, Pa. He does not have day-to-day responsibilities at Charming.
Dorrit Bern continues as Charming’s president and ceo and is overseeing the turnaround effort.
Her strategy involves a big swing to more domestic sourcing, seeking a steadier flow of goods rather than loading up inventories at the beginning of each season and focusing on media advertising instead of relying heavily on in-store visuals. In addition, pricing is being changed, to provide more value consistently, rather than utilizing “high-low” pricing, which involves higher initial markups and more severe markdowns. Charming Shoppes, based in Bensalem, Pa., operates 1,255 stores under the names Fashion Bug and Fashion Bug Plus selling moderate-priced merchandise for women, 25 to 45 years old.
As reported, after a $103 million restructuring charge, Charming lost $107 million in its fourth quarter against a profit of $5.2 million, or 5 cents a share, a year ago.
Charming said that $65 million of the charge would be related to closing 290 stores. Of those, 170 have been closed so far. The remainder of the charge is from restructuring overseas sourcing and domestic corporate operations, including cutting about 2,500 jobs.
Sales for the three months ended Feb. 3 dropped 6.8 percent to $321.8 million from $345.2 million.