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Cutter & Buck to Shutter Retail Stores

SEATTLE-The locally-based specialty retailer says it intends to concentrate on its core business and divest itself of money-losing retail shops. Current plans are to be out of most, or all locations, by early March.

By Gina Binole | Updated on December 04, 2002

SEATTLE-In addition to announcing its second quarter results ended Oct. 31, Cutter & Buck Inc. says it will close its retail operations by March in an effort to restore profitability to the publicly-traded company (Nasdaq: CBUK).

Cutter & Buck officials described the retail stores as a “drag on performance,” and the locally-based specialty retailer expects to save about $23 million in rent, fixed assets of $4 million and inventory of approximately $2.5 million by shuttering the stores and focusing on the core business, which includes the design and marketing of upscale sportswear to golf, corporate, specialty retail and international customers. It accounted for 91% of net sales for the six months ended October 31, 2002. For that period, sales for the core business were $69.4 million, and sales for the company’s retail stores were $6.6 million.

Fran Conley, chief executive officer says the company has made changes to merchandising and staffing patterns, in the last six months. As a result, the stores’ performance improvedsignificantly, but not enough to generate profits. Although the company had beennegotiating with landlords to obtain rent concessions, it reports it did not adequate concessions to allow stores to reach profitability in theforeseeable future.

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