Saks Global said on Friday it will close 15 more stores as it continues a restructuring that follows a bankruptcy filing earlier this year. The retailer framed the move as an effort to stop losses from underperforming locations and concentrate resources on more profitable, higher-end stores.
The latest round of closures includes 12 Saks Fifth Avenue stores and three Neiman Marcus locations, the company said. The restructuring does not affect the companys Bergdorf Goodman presence, which remains a two-store portfolio in New York.
Company executives said the announcement represents the bulk of the work to wind down underperforming outlets, though discussions with some landlords were ongoing as of Friday to finalize the total store count. Weak sales last year contributed to the retailer defaulting on payments to some vendors and losing inventory when brands suspended shipments, the company added.
Inventory flow has begun to improve, according to Saks Global, with more than 500 brands resuming shipments and the retailer reporting nearly $1.3 billion in retail receipts released as inventory moved again.
On February 20, a U.S. bankruptcy judge granted final approval for Saks Globals bankruptcy financing package, which provided $1 billion in new funding to support the company through its restructuring process. Saks also said it has resolved payment concerns brought by vendors including Chanel, Dolce & Gabbana and LVMH, as well as by landlords and Amazon.com, related to goods shipped before the bankruptcy filing.
The retailer entered bankruptcy with $3.4 billion of debt, a development that occurred roughly a year after a transaction intended to combine Saks Fifth Avenue, Bergdorf Goodman and Neiman Marcus under a single umbrella. Earlier in the restructuring, Saks had also closed most Saks OFF Fifth locations and the remaining Neiman Marcus Last Call stores in an earlier round of shutdowns.
Clear summary: Saks Global is closing 15 additional stores - 12 Saks Fifth Avenue and three Neiman Marcus locations - while preserving its two Bergdorf Goodman stores in New York. The company reports improving inventory inflows from more than 500 brands and has received $1 billion in bankruptcy financing approved on February 20. Negotiations with some landlords are ongoing as the company finalizes its reduced store footprint.