Tailored Brands to close 500 stores and cut workforce by 20%; CFO departs
Men’s Wearhouse owner Tailored Brands Inc said on Tuesday that it will cut approximately 20 percent of its corporate workforce and close up to 500 retail stores, as it attempts to jump back from business disruptions resulting from the coronavirus pandemic.
The retailer, which also owns men’s clothing store Jos. A. Bank, said the workforce changes will take effect by the end of the fiscal second quarter.
Likewise, store closures will happen "over time" and it has not "yet quantified the expense savings and costs related to potential store closures."
The changes are expected to “strengthen the company’s financial position and enable it to compete more effectively in the challenging retail environment.”
“Unfortunately, due to the Covid-19 pandemic and its significant impact on our business, further actions are needed to help us strengthen our financial position so we can navigate our current realities. It is always difficult to eliminate jobs and say farewell to our friends and colleagues,” said Tailored Brands president and CEO, Dinesh Lath.
“While today’s announcement is a difficult one, we are confident these are the right next steps to protect our business and position us to more effectively compete in today’s environment.”
The company also announced that Jack Calandra, executive vice president, chief financial officer and treasurer, will exit Tailored Brands as of July 31.
As a result, Calandra’s responsibilities will be divided between Lathi and Holly Etlin, a managing director at AlixPartners, who has been appointed to the newly created role of chief restructuring officer.
The parent company showed signs of struggle last month, when it announced it may have to seek bankruptcy protection or discontinue operations.
As of Tuesday, 96 percent of its store fleet had reopened, though sales are still declining.
First-quarter net sales for the retailer plunged 60.4 percent, as stores were closed due to coronavirus-led nationwide lockdowns.
As of May 2, the company had long-term debt of $1.4 billion and $244.2 million of cash and cash equivalents.
It operates around 1,500 stores in the United States, with about half under the Men's Wearhouse name.
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