SECAUCUS, NJ-While New Jersey-based Toys “R” Us said last week it plans to open 100 stores over the next year, The Children's Place kids' clothing company based here said Thursday it may close 170 stores over the next few years.
During an earnings call, Children's Place executives said 100 under-performing locations will definitely be closed by 2016. No sites were specified, but executives said they were talking about oversized stores in shopping malls, mostly in the United States.
Another 70 stores will be closed if sales at their locations do not improve. The company currently has 1,116 total stores.
Jane Elfers, the company's president and CEO said the second quarter was strong, with sales up 6% to $382.4 million, compared to $360.8 million in Q2 of 2012. "We are encouraged by the solid start to the back-to-school season," Elfers said.
The company's e-commerce section has continued to post quarterly gains, Elfers said, with a 24% gain in the Q2. The Web sales will help generate revenue lost when stores are closed, said CFO Mike Scarpa.
New and smaller locations could be opened to replace stores that close, Scarpa said, particularly in areas that serve the Hispanic market. Furthermore, The Children's Place will be expanding overseas: 40 stores are to open by the end of the year in the Middle East and more are planned for Israel in 2014.
Toys “R” Us, based in Wayne, has announced a plan to open 100 new or remodeled stores this year in 21 countries. The retailer plans to open 22 new stories in China, for a total of 51 locations in that country.
It will also open nine new outlet stores, in California, Georgia, Mississippi, Missouri, Tennessee, Texas, and Puerto Rico, which will increase its smaller outlet portfolio in the U.S. to 25.
In addition, 10 new or converted "side-by-side" (Toys “R Us and Babies “R”Us) stores will open by the end of the year.
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