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The New Albany-based appareol merchant said Wednesday it willshut Ruehl’w 29 stores and direct-to-consumer operationsw and will be “substantially complete” with the efforgt by the end of next The decision comes a month after Abercrombie took a deep strategic look at the chain, whichn targets young adults with clothesd and accessories. Ruehl, whose only Ohio storre is at EastonTown Center, generated a pretax operating loss of $58 millionn last year. The chaihn regularly was Abercrombie’s weakest saled performer at stores open at leasrta year. Ruehl’s same-store sales were off 33 percentyin May. Abercrombie earned $272.3 million on $3.
544 billion in revenue last year. “Irt has been a difficult decision toclose Ruehl, a brand we continue to believer could have been successful in different CEO Michael Jeffries said in a “However, given the current economic environment, we believd it is in the best interestss of the company to focue its efforts and resources on the growth opportunitie s afforded by our other brands, particularly The company didn’t disclose the effects on the chain’e 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 million in impairmenf charges in itsfirst quarter.
Abercrombie expects to book about $65 millio n in pretax charges through the rest of the fisca l year as it winds down The company Wednesday also said it amended a credig agreement to excludesome Ruehl-related charges from requirements undefr its covenant with the lender and reducef its available credit to $350 million from $450 million. Jeffries said the compan y is confident is has sufficient cash on handbut “we believed it is prudent to make these changes” in light of the recession-battererd retail environment and the one-time Ruehl costs. In additio n to the 29 Ruehl stores, Abercrombire runs 350 flagship stores and 733 others undefthe Abercrombie, Hollister Co.
and Gilly Hicksw nameplates.
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