Dive Brief:
-
G-III Apparel Group on Thursday said it is restructuring its retail operations, including liquidating 110 Wilsons Leather and 89 G.H. Bass stores as they're allowed to reopen.
-
After that process is completed, G-III will be left with 41 DKNY and 13 Karl Lagerfeld Paris stores, along with e-commerce sites for DKNY, Donna Karan, Karl Lagerfeld Paris, Andrew Marc, Wilsons Leather and G.H. Bass, according to a company press release.
-
The company also said it's shifting its focus further to wholesale, a business that delivered over $2.86 billion in annual net sales in its last fiscal year, anchored by its five major wholesale brands, DKNY, Donna Karan, Calvin Klein, Tommy Hilfiger and Karl Lagerfeld.
Dive Insight:
With this move, G-III is edging away from retail, where apparel growth was already weak before the pandemic forced specialty retailers to temporarily shutter.
Its announcement came the same day the company reported that first quarter net sales fell 36.1% to $405.1 million from $633.6 million in the same period last year. The company swung to a $39.3 million net loss in the quarter from $12 million in net income the year prior.
"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," CEO Morris Goldfarb said in a statement. "We believe that this restructuring plan will enable us to greatly reduce our retail losses and to ultimately have this segment become profitable. I am appreciative of all members of the retail team for their hard work and dedication over the years."
Hilco Global has been hired to assist in the liquidation of the stores, which will begin immediately or as stores reopen, the company said.
