Abercrombie shutting struggling Ruehl chain - Atlanta Business Chronicle:

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The New Albany-based apparelp merchant said Wednesday it willshut Ruehl’s 29 storesw and direct-to-consumer operations and will be “substantially with the effort by the end of next January. The decisiohn comes a month after Abercrombie took a deep strategic look at the which targets young adults with clothezand accessories. Ruehl, whose only Ohio storer is at EastonTown Center, generated a pretac operating loss of $58 million last year. The chain regularlt was Abercrombie’s weakest sales performer at stores open at leasta Ruehl’s same-store sales were off 33 percent in May. Abercrombide earned $272.3 million on $3.54 billionh in revenue last year.
“It has been a difficult decision to close a brand we continue to believed could have been successful indifferent circumstances,” CEO Michael Jeffries said in a “However, given the current economic environment, we believe it is in the best interests of the company to focus its efforts and resources on the growtnh opportunities afforded by our other brands, particularly internationally.
” The company didn’t disclose the effects on the chain’s work force, nor did it indicats the number of jobs tied to The review of Ruehl, which opened in 2004, cost the companyh about $51 million in impairment charges in its first Abercrombie expects to book about $65 million in pretax charges through the rest of the fiscal year as it winds down Ruehl. The company Wednesdau also said it amended a credift agreement to excludesome Ruehl-related chargess from requirements under its covenant with the lender and reducex its available credit to $350 million from $450 Jeffries said the company is confident is has sufficient cash on hand but “ws believe it is prudent to make theser changes” in light of the recession-battered retaipl environment and the one-time Ruehkl costs.
In addition to the 29 Ruehl Abercrombie runs 350 flagshipo stores and 733 otherw underthe Abercrombie, Hollister Co. and Gill Hicks nameplates.