New York City Aeropostale said Monday that it is shuttering its Jimmy’Z concept, a move that will allow the chain to focus on growing its core Aeropostale concept.
Hurt by the sluggish economy and low sales performance, the retailer decided to shut the Jimmy’Z banner’s doors. This move will enable the company to grow its core Aeropostale business, and roll out a new retail concept. The upcoming brand will target a younger shopping demographic.
“We believe that discontinuing the Jimmy'Z concept will enable us to focus on businesses which align with our core competencies, and generate greater long-term shareholder value," said Julian R. Geiger, chairman and CEO, Aeropostale.
During the first half of fiscal 2009, the closing will contribute approximately $5.0 million of additional pre-tax costs related to lease terminations, inventory liquidation, and employee retention and severance obligations.
By closing Jimmy’Z, Aeropostale hopes to gain an ongoing financial benefit of approximately $8.0 million pre-tax, due to annualized operating losses.
The retailer expects to phase out Jimmy’Z in the second quarter of fiscal 2009.