G-III Apparel Group Ltd. is trimming its brick-and-mortar fleet.
The New York-based fashion manufacturer and marketer has announced the permanent closures of all 110 Wilsons Leather and 89 G.H. Bass stores as it restructures its retail operations segment. The liquidations of these outposts, assisted by financial services firm Hilco Global, are set to begin immediately or as soon as locations reopen amid the coronavirus pandemic.
“With a focus on enhancing shareholder value, we have made the difficult decision to close all of the Wilsons Leather and G.H. Bass stores and have entered into agreements for the early lease termination of a significant majority of these stores,” chairman and CEO Morris Goldfarb said in a statement this morning.
The announcement came in tandem with the company’s first-quarter financial results: For the three months ended April 30, G-III logged sales that fell more than 36% to $405.1 million and a quarterly loss of 75 cents per share. Analysts had anticipated revenues of $449 million and a loss of 55 cents per share.
Watch on FN
As part of its restructuring plan, the group expects to incur an aggregate charge of roughly $100 million due to lease termination fees, severance pay for workers and store liquidation costs, as well as write-offs related to right-of-use assets plus legal and professional fees.
“We believe that this restructuring plan will enable us to greatly reduce our retail losses and to ultimately have this segment become profitable,” Goldfarb explained.
The company’s wholesale business — anchored by the DKNY, Donna Karan, Calvin Klein, Tommy Hilfiger and Karl Lagerfeld brands — will continue to be its “primary growth and profit engine.” Following the restructuring, the retail operations segment will retain 14 DKNY and 13 Karl Lagerfeld Paris stores. It will also consist of the e-commerce platforms for DKNY, Donna Karan, Karl Lagerfeld Paris and Andrew Marc, as well as Wilsons Leather and G.H. Bass.
G-III designs, sources and markets apparel and accessories under owned, licensed and private-label brands. Its owned banners include DKNY, Donna Karan, Andrew Marc and G.H. Bass. It also holds fashion licenses under the Calvin Klein, Tommy Hilfiger and Karl Lagerfeld Paris brands. Through its retail subsidiaries, the company operates stores under Wilsons Leather and G.H. Bass, plus DKNY, Karl Lagerfeld Paris and Calvin Klein Performance names.