The openings will bring the company's portfolio to 1,128 Talbots and 241 J. Jill units by the end of the year. Shareholders approved Talbots $517-million acquisition of J. Jill at the beginning of this month, bringing together two clothing chains that target women over 35.
Currently, the chains have a 75% real estate overlap. J. Jill will likely be the company's larger growth vehicle in the future since it is the smaller of the two, said Arnold B. Zetcher, Talbots' chairman, president and chief executive officer, during the company's first-quarter conference call. "It allows us to go into places, both merchandise-wise and location-wise, that Talbots couldn't," he says of the newly-acquired chain, which sells clothing at lower price points than Talbots.
Meanwhile, the costs of the merger, in part, are prompting executives to expect a loss of 5 cents to 15 cents during the second quarter. "2006 will be a dilutive year as we build toward the future," Zetcher says.
Though the company will no longer break out earnings or same-store sales results per chain beginning at the second quarter's results, executives say that both the Talbots and J. Jill divisions will experience losses during the period.
During the first quarter, which ended April 29, Talbot's (without J.Jill) posted a 0.9% same-store sales increase year over year. Net sales increased 1%, to $453 million, and net income dropped to $27.4 million from $34.5 million during last year's first quarter.
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