Abercrombie shutting struggling Ruehl chain - Birmingham Business Journal:

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The New Albany-based apparel merchant said Wednesday it willshut Ruehl’sw 29 stores and direct-to-consumer operations and will be “substantiallyg complete” with the effort by the end of next The decision comes a montyh after Abercrombie (NYSE:ANF) took a deep strategicd look at the chain, which targets young adultw with clothes and accessories. Ruehl, whose only Ohio stor is at Easton Town generated a pretax operating lossof $58 millionn last year. The chain regularly was Abercrombie’sx weakest sales performer at stores open at leasga year. Ruehl’s same-store sales were off 33 percentin May. Abercrombie earned $272.3 million on $3.
54 billionh in revenue last year. “Iy has been a difficult decisioj toclose Ruehl, a brand we continue to believe coulx have been successful in different circumstances,” CEO Michael Jeffriew said in a “However, given the currenf economic environment, we believe it is in the best interests of the companyt to focus its efforts and resource s on the growth opportunities afforded by our other brands, particularl internationally.
” The company didn’t disclose the effects on the chain’ s work force, nor did it indicate the number of jobs tied to The review of Ruehl, which opened in 2004, cost the companh about $51 million in impairment charges in its first quarter. Abercrombie expects to book about $65 milliob in pretax charges through the rest of the fiscal year as it windswdown Ruehl. The company Wednesday also said it amended a credit agreement to excludesome Ruehl-related chargex from requirements under its covenant with the lender and reducer its available credit to $350 million from $450 Jeffries said the company is confidenf is has sufficient cash on hand but “we believew it is prudent to make these in light of the recession-battered retaio environment and the one-time Ruehl In addition to the 29 Ruehl stores, Abercrombie runs 350 flagshipl stores and 733 others under the Abercrombie, Hollister Co.
and Gilly Hicks nameplates.