Womenswear retailer Ann Taylor Stores (New York) says it expects to increase the number of store closings based on a wider than expected fourth-quarter loss. The company reported a fourth quarter loss of $375.6 million, down from a loss of $6.7 million a year earlier. Same-store sales fell more than 29 percent at Ann Taylor stores and declined nearly 22 percent at its discount-priced LOFT stores.
Ann Taylor says its sales were hurt by rising unemployment and falling consumer confidence. The company said it also had to mark down merchandise substantially to clear out inventory, which hurt its margins.
The company says it will now close 163 stores by the end of fiscal 2010. The previous store closing estimate was 117 stores.
Some analysts are now questioning the company’s long-term viability. "We believe that
Ann Taylor just may be a day late and a dollar short," says retail analyst Jennifer Black. "All the cost-cutting and inventory tightening in the world won't save this company if they can't get the customer back."
Black says that if the company’s fall line, under the new guidance of president Christine Beauchamp, head of the company's Ann Taylor Stores division, is not well received, she sees this company "swirling the drain."