FORT MYERS, FL—After a disappointing 2006, Chico’s will close its Fitiques brand and slow the growth of Soma in 2007. But it still will open up to 145 new stores in its various formats, executives said at its fourth-quarter conference call.

After a “challenging” 2006, the company has revised its targeted net new store openings for fiscal 2007 downward to between 135 and 145 new stores (excluding the 10 Fitigues planned closures). Plans call for 55 to 60 new Chico’s stores, 55 to 60 White House/Black Market stores and 20 to 25 Soma stores. In addition, 45 to 55 relocations/expansions are planned.

“We have decided to slow down the Soma store growth somewhat so that we can focus on strengthening the management team, improving profitability and expanding Soma beyond the Chico’s customer,” said Scott Edmonds, president and CEO. “We continue to believe, now more than ever, that the Soma intimate apparel concept represents an excellent market opportunity within the specialty apparel arena.”

Soma stores will drop the “by Chico’s” tagline in an effort to expand its market beyond Chico’s shoppers, which currently constitutes 90% of its customer base, Edmonds said. In addition, Soma’s site criteria are being modified after testing a variety of locations and sizes. Future units will average 2,020 sf.

“We’ve learned it needs to be in high-traffic rather than destination locations,” said Charles Kleman, CFO. “We are being more selective with this knowledge.”

The slowdown will continue in fiscal 2008, as well. Plans call for approximately 105 to 115 net new stores and 30 to 50 relocations and expansions of existing stores. Currently, the company expects to open 40 to 50 Chico’s stores, 50 to 60 White House/Black Market units, and 5 to 15 Soma stores. The company still maintains that the potential exists for a total of 700 to 850 units each for Chico’s and White House/Black Market.

For the 14-week fourth quarter ended February 3, 2007, net sales increased 18.8% to $446 million for the 13-week fourth quarter of 2005. Net income was $18 million, compared to net income of $44 million in the prior fourth quarter. Comparable-store sales for company-owned stores decreased 2% for the 14-week fourth quarter compared to the same 14-week period last year. Comps were consistent in both Chico’s and White House/Black Market.

For the 53-week fiscal year, net sales were $1.65 billion, up 17.2% from 2005. Net income totaled $167 million, compared to net income of $194 million in the prior period. Comparable-store sales for company-owned stores increased 2.1% compared to the same 53-week period last year. Chico’s same-store sales were essentially flat, while same-store sales for White House/Black Market rose approximately 11%.

Chico’s operates 925 women’s specialty stores, including stores in 47 states, the District of Columbia, the US Virgin Islands and Puerto Rico operating under the Chico’s, White House

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Dig Deeper

GlobeSt Net Lease Spring 2024Event

This conference brings together the industry's most influential & knowledgeable real estate executives from the net lease sector.

Get More Information
 

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.