15255 Mon, 09/22/2008 - 11:36am
GARDEN CITY, N.Y.–Lifetime Brands said it plans to close its remaining 53 outlet retail stores, as well as its distribution center in York, Pa. The stores include 39 Pfaltzgraff factory stores, eight Farberware outlet retail stores and six clearance centers.
To operate and manage the inventory clearance sales at the stores, the company has entered into a partnership with a joint venture between Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC. These sales are expected to begin on or about Sept. 23, and will be completed by the end of the year. The distribution center will close next year.
As a result, Lifetime expects to incur a pretax, non-cash charge of up to approximately $7.5 million with respect to the write-off of fixed assets associated with the stores, the distribution center and related operations, it said in a statement. It also expects to record a portion of this charge in the quarter ended Sept. 30, and that it will incur about $15 million in other pretax charges, recorded largely in the quarter ending Dec. 31. Lifetime also expects the cash proceeds from the inventory clearance sales will exceed the cash charges incurred with respect to the store and distribution center closings and related restructuring activities.
“Despite the many actions we have taken to streamline and improve the operations of the retail stores, in today’s difficult retail environment they have continued to encumber our company’s earnings,” said Jeffrey Siegel, chairman, president and chief executive officer, in a statement. “In addition to eliminating this burden, today’s actions will enable us to focus our efforts on growing our core wholesale business.”