* Department store chain to review strategy by year-end
* CEO Penttila to resign
* Analyst says cost cuts, closures and real estate deals
* Shares rise 7 pct
(Adds share reaction, analyst comment)
HELSINKI, May 23 Finnish department store chain
Stockmann said on Friday it would revise its strategy
by the end of the year, sending its shares up on speculation of
restructuring moves by the loss-making company that could boost
Stockmann last month lowered its full-year sales and profit
outlook due to weak demand in Finland and Russia, as well as the
weaker Russian rouble, after posting a bigger-than-expected loss
for the first quarter.
"The board of directors has decided to begin a process of
reviewing and revising Stockmann's existing strategy, the
outcome of which could have a considerable impact on the present
structure of the business operations," the company said on
It also said its long-time Chief Executive Hannu Penttila,
who reached retirement age in 2013, would resign at the end of
Shares in the company jumped 7.3 percent to 11.06 euros.
Analysts speculated on possible store closures, real estate
deals or a Russia exit. The stock is, however, still 10 percent
lower than in was at the end of February.
The company has five department stores in Moscow and one in
St Petersburg, which have been hard hit by the Russian slowdown
and Ukraine crisis.
"They could perhaps close some of the weakest stores, and it
is even possible they would start a total pull-out from that
market over some kind of time period," said Nordea analyst Rauli
He also said the company could look at closing its smaller
fashion chain Seppala, which is deep in the red.
Media reports have suggested Stockmann could put its
flagship real estate holdings in Helsinki and St Petersburg up
for sale, with the Helsinki store possibly worth 800 million
euros ($1.1 billion). The company has said it has no such plans.
($1 = 0.7323 Euros)
(Reporting by Jussi Rosendahl and Anna Ringstrom; Editing by