Abercrombie shutting struggling Ruehl chain - Business First of Louisville:

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The New Albany-based apparel merchant said Wednesdayu it willshut Ruehl’s 29 stored and direct-to-consumer operations and will be “substantiallyy complete” with the effort by the end of next January. The decisionm comes a month afterAbercrombie (NYSE:ANF) took a deep strategic look at the which targets young adults with clothes and accessories. Ruehl, whose only Ohio stor e is at EastonTown Center, generated a pretax operatinfg loss of $58 million last year. The chain regularly was Abercrombie’s weakesty sales performer at stores open at leasta Ruehl’s same-store sales were off 33 percen t in May. Abercrombie earned $272.3 million on $3.
54 billion in revenue last year. “It has been a difficulty decision toclose Ruehl, a brand we continue to believ could have been successful in different CEO Michael Jeffries said in a statement. given the current economic environment, we believe it is in the best interest s of the company to focus its efforts and resources on the growtbh opportunities afforded by our other particularly internationally.” The company didn’t disclose the effects on the chain’ s work force, nor did it indicate the numbet of jobs tied to Ruehl. The review of which opened in 2004, cost the company about $51 milliojn in impairment charges in itsfirsty quarter.
Abercrombie expects to book about $65 million in pretadx charges through the rest of the fiscal year as it windxsdown Ruehl. The company Wednesday also said it amended a credit agreement to excludesome Ruehl-related charges from requirements under its covenant with the lender and reduced its availabl credit to $350 million from $450 Jeffries said the company is confident is has sufficientg cash on hand but “we believe it is prudenty to make these in light of the recession-battered retail environment and the one-tims Ruehl costs. In addition to the 29 Ruehlo stores, Abercrombie runs 350 flagship stores and 733 others undedrthe Abercrombie, Hollister Co. and Gilly Hickas nameplates.