Coldwater Creek plans budget cuts, layoffs
Coldwater Creek Inc. will eliminate close to 100 jobs, slash inventory and make other adjustments as part of a restructuring aimed at cutting $20 million to $25 million in its fiscal 2013 budget.
Those steps include layoffs across the Sandpoint retailer’s operations business that will result in a 20 percent reduction in “corporate workforce” expenses, the company said in Tuesday’s announcement.
However, company officials declined to be more specific on how many jobs will be eliminated and where those layoffs will be.
Earlier this year the women’s apparel retailer had about 2,500 full-time employees and 4,100 part-time employees. It operates about 340 stores after closing more than 30 last year.
The company will take a pretax charge of about $3 million for severance and other expenses related to the restructuring in the third quarter.
The moves follow an announcement two weeks ago in which the board listed several options being considered to improve value for stockholders. Among the options is selling the company, the board announced on Oct. 14.
No deadline was given.
That same report also noted company officials have suspended providing quarterly guidance until “business returns to a more predictable cadence.”
Coldwater Creek, launched in 1984, has been mired in a downward spiral for years. Its last quarterly profit was in early 2010.
The company reported a $22 million loss during its second quarter 2013 earnings report.
On Wednesday, Coldwater Creek also announced the departure of its No. 2 executive, Jerome Jessup. Jessup became the firm’s president and chief creative officer in early 2011. His salary, listed in the company’s 2012 annual report, was $1.4 million.
“The elimination of Mr. Jessup’s position was in connection with the restructuring and cost cutting program,” Coldwater Creek said in a news release.
Jessup answered to CEO Jill Brown Dean, whose 2013 salary is listed as $3.4 million.
In addition to the vague statement on the jobs being cut, the company also mentioned other, unspecific restructuring efforts.
“Coldwater Creek continues to make progress on its previously announced operational initiatives involving inventory, expense management and store optimization. The company expects to continue to realize further meaningful benefits from these strategies,” a release read.