Foot Locker to close 190 under-productive stores
Foot Locker, Inc. the New York-based specialty athletic retailer, announced a change to its organizational structure, steps taken to improve its corporate efficiency and updates to its 2009 real estate plans. The Company will change its organizational structure by consolidating the management team that oversees its Lady Foot Locker business with the team that currently manages the Foot Locker U.S., Kids Foot Locker and Footaction businesses. Effective with this change, Richard A. Johnson will become President and Chief Executive Officer of Foot Locker U.S., Footaction, Kids Foot Locker and Lady Foot Locker. Richard Johnson is moving from his position as President and Chief Executive Officer of the Company's successful Foot Locker Europe operation, effective immediately.
"We expect the consolidation of our Foot Locker businesses under the direction of one management team to help us clarify our Foot Locker family of brands position in the retail marketplace," stated Ken C. Hicks, President and Chief Executive Officer of Foot Locker, Inc. "It will allow us to sharpen our focus on the female consumer, as we look to improve the coordination of our women's merchandise assortments and marketing strategies across each of our Foot Locker brands. This move is a component of a new, comprehensive strategic plan that we expect to complete and announce early in our 2010 fiscal year."
As a result of this divisional reorganization, as well as some corporate staff reductions taken to improve corporate efficiency, the Company expects its financial results in 2010 to be enhanced by annual expense savings of approximately $10 million. An after-tax charge of $3 million, or $0.02 per share, is expected to be recorded during the fourth quarter of 2009 to reflect the costs associated with the elimination of approximately 120 home office and field management positions.
The Company is completing its real estate actions for fiscal 2009, working in partnership with its landlords. For the full year, the Company currently estimates that it will open 37 new stores, close 190 under-productive stores, and remodel or relocate 160 stores. As a result, 117 stores are expected to be closed during the fourth quarter, a large percentage of which are Foot Locker and Lady Foot Locker stores in the United States.
Mr. Hicks continued, "The work we are doing to strengthen our brand positioning, coupled with steps we are taking to streamline corporate staff functions and enhance our real estate portfolio, is designed to make us a more efficient organization, bolster our already strong financial position and, most importantly, enhance our competitive strength and leadership position now and for the long term."
"I am very pleased to promote Dick Johnson to his new position as President and Chief Executive Officer of Foot Locker U.S./Lady Foot Locker/Kids Foot Locker/Footaction. He has been a very strong leader of our successful Foot Locker Europe operation over the past three years and will be a strong addition to our U.S. management team. Lewis P. Kimble has been promoted to succeed Dick Johnson as President and Chief Executive of Foot Locker Europe. Lew has done an outstanding job over the past four years as Managing Director of our Foot Locker Asia/Pacific division, during which time this business achieved record levels of sales and profits."
Foot Locker Inc