Leading footwear manufacturer and retailer Wolverine World Wide plans to close 140 stores in the next 18 months as part of a strategic realignment plan focused on strengthening omnichannel capabilities.
Most of the stores to be closed operate under the company’s Stride Rite banner. Sixty of the units will close by year end with the remainder to close next year, the company said. The disclosure was made in conjunction with the release of solid financial results for the company’s second quarter ended July 14.
The strategic realignment plan and related store closures are intended to optimize the fleet of retail locations, right-size the supporting infrastructure, address a fundamental shift in consumer shopping behavior and allow for greater focus on important omnichannel initiatives, according to the company.
"The strategic realignment plan announced today is an important step in the evolution of the company's consumer-direct operations to meet the changing behavior of today's consumer," said Blake Krueger, Wolverine’s chairman and CEO. "We are confident that these actions will set a new foundation for our consumer-direct business, help position our company for future growth and increase shareholder value."
The company expects to take a pretax charge related to the plan in the range of $30 million to $37 million. The company noted that once the plan is implemented it expects to realize annual pretax benefits of approximately $11 million and intends to redeploy what it characterized as “a meaningful portion” of the benefits to further build out consumer-direct omnichannel capabilities and accelerate growth in its wholesale operations.
During the second quarter Wolverine’s sales increased 4.4% to $613.5 million and earnings per share increased 50% to 27 cents.
"We are extremely pleased to deliver a record quarter in what continues to be a volatile global retail environment, particularly in the U.S.,” Krueger said. "All of our operating groups achieved a revenue increase in the quarter, which was spread across nearly every region of the world.
Wolverine World Wide is the company behind some of the best known brands in footwear including Merrell, Sperry Top-Sider, Hush Puppies, Saucony, Wolverine, Keds, Stride Rite and Sebago.