The A&F Co. has announced it is closing up to 40 stores by next February.
According to CNBC, most of the stores closing are located in the United States. Over the last eight years, the retailer has shuttered about 475 stores, and has also reduced the size of its stores and remodeled existing locations. In fiscal 2018, the retailer closed 29 stores, with more possible since around 50 percent of its leases expire within the next few years. However, in addition to the closings, the company does plan to invest approximately $120 million in store experiences in 2019, including 85 new stores experiences and 40 new stores.
CEO Fran Horowitz told analysts on the conference call that the company is “carefully evaluating closed stores when appropriate.”
Shares of Abercrombie soared about 20 percent on Wednesday (March 6) after the company beat Wall Street estimates for earnings and reported strong same-store sales growth. During Q4, the company earned $1.35 per share, which beat the projected $1.15 per share. It also reported same-store sales growth of 3 percent, beating Wall Street’s forecasts of 1.5 percent.
Abercrombie is the latest retailer to reveal plans to shutter stores. Last month, Payless won approval from a bankruptcy court to begin closing its 2,500 stores in North America, effectively putting 16,000 employees into eventual unemployment. The current plan is to close all Canadian operations by April 30, and all U.S. locations by May 21. In order to retain some workers through the closings, the company will spend about $8.6 million in bonus pay.
“We are pleased that the Court has approved our First Day motions, which are a crucial step in our execution of an efficient wind-down of our North American stores and eCommerce operations, and to maximize the value of the merchandise being sold,” Stephen Marotta, chief restructuring officer for Payless, said at the time.
Charlotte Russe also announced in February that it will close around 95 locations as it searches for a buyer after filing for Chapter 11, and just this past week, Dollar Tree said it will convert roughly 200 Family Dollar stores to its eponymous brand, while closing as many as 390 locations. In 2015, the retailer bought the Family Dollar chain for almost $9 billion in stock and cash, but since that time, the chain has faltered and brought down Dollar Tree’s performance.