LOS ANGELES, Feb 23 (Reuters) - Teen clothing retailer Aeropostale Inc ARO.N on Monday said it would close its 11-store Jimmy’Z chain to focus on its namesake store and a new concept that will target younger shoppers.
The company said it would close the Jimmy’Z stores in the second quarter.
During the first half of fiscal 2009, the company expects to book about $5 million of additional pretax costs related to lease terminations, inventory liquidation and employee retention and severance obligations.
Aeropostale expects an ongoing financial benefit from the elimination of Jimmy’Z annualized operating losses of around $8 million pretax, or 7 cents per share.
“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,” Aeropostale Chief Executive Julian Geiger said in a statement.
Aeropostale shares closed down 2 percent at $21.66 on the New York Stock Exchange. (Reporting by Lisa Baertlein; Editing by Gary Hill)