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Shrinking Levi's

Designs Inc. says it will trim down its Levi's and Docker's outlet chains to concentrate on Casual M

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Designs Inc. (Canton, Mass.), which operates nearly 600 Casual Male Big & Tall, Levi's Outlet by Designs, Dockers Outlet by Designs, Candies and Ecko Unltd. outlet stores, has announced plans to close between 34 and 40 stores over the next 12-18 months — including 15-20 Levi's and Docker's outlet stores — combine 6-8 other stores and reduce the square footage in another 20-25 stores.

The company reported a sales increase of about 142 percent for its second quarter ending Aug. 3, 2002 — most of that from the May purchase of Casual Male Corp. But Levi's and Docker's business declined 15 percent.

In May, the company purchased Casual Male Corp., adding 472 stores in 44 states. These stores and the former company's catalog sales represented about 63 percent of the company's total sales for the quarter and showed a same-store sales increase of 4 percent.

“We have re-evaluated the performance of this business, due to the continued erosion of the Levi's brand in the marketplace and Levi Strauss's consistent inability to provide a balanced assortment of product for our Levi's and Dockers stores,” said senior vp and cfo Dennis Hernreich. “We and have already started negotiations with several landlords to terminate leases on the remaining underperforming stores. Once the downsizing is complete, the Levi's business will represent less than 20 percent of our combined sales, while maintaining a favorable level of profitability.”

“As we have previously mentioned, we look forward to capitalizing on the significant growth potential in the big and tall men specialty market,” said president and ceo David Levin. “Since our successful acquisition of the Casual Male business in May, we have been working on moving our company toward a new strategic direction, which is primarily focused on growing our Casual Male business. Specifically, we plan to open approximately 40 new Casual Male stores over the next 12 to 18 months and expand on our existing catalog and internet businesses.”

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At the company's upcoming annual meeting, stockholders will be voting to change the name of the company to Casual Male Retail Group Inc.

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