Charlotte Russe Holding Inc. (San Diego) has decided to discontinue testing the Charlotte's Room concept and expects to close the 10 stores as soon as possible.
“Charlotte's Room, a lifestyle accessories store for tweens and young teens, has been unable to achieve the level of sales necessary for us to consider rolling out additional stores,” said chairman and ceo Bernard Zeichner. “During the last quarterly conference call on Jan. 23, 2003, I indicated management was pursuing alternatives for this concept. Based on the review and analysis performed, we determined that the best course of action at this time would be to close the 10 stores and focus our complete attention on the Charlotte Russe and Rampage chains.”
The mall-based retailer operates about 241 Charlotte Russe and Rampage clothing stores in about 34 states and Puerto Rico. It had begun the year with plans to open 75 new stores in 2003.
“We have experienced a significant and persistent drop in comparable-store sales at the Charlotte Russe and Rampage chains in this our seasonally slowest quarter of the year,” Zeichner said. “While we began the second quarter in January with comparable-store sales increases, in February we experienced negative comps. To date, March hasn't shown any improvement due to continued economic uncertainty, slow mall traffic, and the later Easter this year.
“As a result, when we announce the second quarter results on April 17, 2003, we would expect to report a decline in comparable-store sales of approximately 11 to 12 percent for the quarter ending March 29, 2003. During the third quarter [ending in June], we fully expect to return to profitability.”