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Children's Place to exit Disney business in North America
27 Mar '08
4 min read
The Company continues to expect the pre-tax cash costs to exit the DSNA business to be within the previously stated range of $50 million to $100 million, payable over a period of time.
Neither Hoop's parent company, The Children's Place Retail Stores Inc nor any of its other subsidiaries, filed for bankruptcy.
Chuck Crovitz, Interim Chief Executive Officer of The Children's Place Retail Stores Inc stated, "This exit strategy is consistent with the corporate actions and strategic priorities we outlined last week. This will enable the Company to transition away from the Disney Store business in an orderly and expeditious manner so that we can concentrate exclusively on The Children's Place, our core brand and business. We have the utmost respect for the Disney Store brand, however, the cost of running the Disney Store was no longer an acceptable use of Company's resources. We were left with no other choice but to find a reasonable way to exit the operations within the confines of the existing license agreement."
"We believe this is the right decision for The Children's Place and its shareholders as we move forward with our plans to strengthen operations, a process which is well underway. We are pleased with recent sales trends in the core business and continue to believe that The Children's Place brand is strong and well-positioned for the future."
As previously disclosed, the Company has been conducting an ongoing review of strategic and financial alternatives to accelerate improvement of The Children's Place business and deliver enhanced shareholder value. The management team has outlined a number of specific initiatives including reducing expenses and streamlining operations and is also seeking additional funding to strengthen its capital position. There can be no assurance that the Company will be able to obtain such funding. As the Company's review is ongoing, management will continue to provide updates and report on progress throughout 2008.
Neither Hoop's parent company, The Children's Place Retail Stores Inc nor any of its other subsidiaries, filed for bankruptcy.
Chuck Crovitz, Interim Chief Executive Officer of The Children's Place Retail Stores Inc stated, "This exit strategy is consistent with the corporate actions and strategic priorities we outlined last week. This will enable the Company to transition away from the Disney Store business in an orderly and expeditious manner so that we can concentrate exclusively on The Children's Place, our core brand and business. We have the utmost respect for the Disney Store brand, however, the cost of running the Disney Store was no longer an acceptable use of Company's resources. We were left with no other choice but to find a reasonable way to exit the operations within the confines of the existing license agreement."
"We believe this is the right decision for The Children's Place and its shareholders as we move forward with our plans to strengthen operations, a process which is well underway. We are pleased with recent sales trends in the core business and continue to believe that The Children's Place brand is strong and well-positioned for the future."
As previously disclosed, the Company has been conducting an ongoing review of strategic and financial alternatives to accelerate improvement of The Children's Place business and deliver enhanced shareholder value. The management team has outlined a number of specific initiatives including reducing expenses and streamlining operations and is also seeking additional funding to strengthen its capital position. There can be no assurance that the Company will be able to obtain such funding. As the Company's review is ongoing, management will continue to provide updates and report on progress throughout 2008.
The Children's Place Retail Stores Inc
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