Limited Brands Cuts Real Estate Projects
Columbus, Ohio Limited Brands Inc. said Thursday that it is cutting the number of real estate projects planned for this year as it tries to improve results in its stores.
The retailer, which operates the Victoria’s Secret and Bath & Body Works chains, made the comments during a conference call. It said the reduction in real estate projects should lower its planned capital expenditures by $85 million.
On Wednesday, Limited Brands said its fourth-quarter profit fell 12% on a substantial decline in sales following last summer’s decision to get out of the apparel business. Weak store traffic and scaled-back circulation of its Victoria’s Secret catalog also contributed to the decline.
Limited Brands said it made $388.6 million compared with $439.8 million in the same quarter a year ago. Sales totaled $3.28 billion for the quarter, down from $4.02 billion a year earlier.
In July, the company transferred 75% ownership of its Limited Stores chain to buyout firm Sun Capital Partners Inc. and sold a 75% interest in its Express brand to affiliates of private equity firm Golden Gate Capital.
Dillard’s to Up Fashion Quotient
Little Rock, Ark. As part of its turnaround strategy, Dillard’s plans to offer more fashionable merchandise in hopes of positioning itself above Macy’s and Belk, and below Nordstrom and Bloomingdale’s, according to WWD.com.
The company is “trying to evolve from moderate to better prices and update from traditional, basic product to more enticing fashion assortments,” said William T. Dillard III, VP of accessories, intimate apparel and shoes at Dillard’s.
Dillard’s new stores are also smaller, measuring about 170,000 sq. ft. They are located in open-air lifestyle centers, compared with the retailer’s previous 200,000-sq.-ft. prototype, located in traditional malls.
Dillard’s will open nine new stores this year, all in open-air lifestyle centers in smaller markets.
Report: Fresh & Easy Not Meeting Sales Goals
New York An industry consultant said that Fresh & Easy Neighborhood Market stores have not yet come close to achieving the sales levels Tesco officials were originally hoping for, according to supermarketnews.com.
Speaking on Wednesday with investors in the United States and United Kingdom in a conference call sponsored by New York-based Citigroup, Jim Prevor said the 52 Fresh & Easy stores that have opened since November are averaging weekly sales volumes of $50,000 to $60,000, or about $5 per square foot—below the goal of $200,000 a week and $14-$22 in sales per square foot the company had projected.
Prevor said the volume estimates are based on discussions with competitors, vendors, industry observers and Fresh & Easy store managers.
In other news, Fresh & Easy Neighborhood on Thursday opened the doors to its 50th store in Palm Desert, California.
Last month, the company announced an expansion into Northern California, with 18 stores in the Bay Area slated to begin opening in 2009.
Fresh & Easy will open an additional three stores by the end of the week—one in North Las Vegas and two in Henderson, Nev. An announcement of store locations in the Sacramento region will occur by the end of the month.