By Staff -- Home Textiles Today, 2/7/2005 12:00:00 AM
25 Kmarts on the Fast Track
Half of the 50 Kmart stores Sears acquired last summer are on a program of “fast-track conversion” and will open as midsize format Sears stores as early as March 15, according to a Sears filing with the Securities and Exchange Commission. The retailer didn't identify where the stores are located, but said the name of the format will be announced in the “coming weeks.”
The format could outline the strategy for future Kmart conversions to freestanding Sears formats. The companies are expected to complete their merger in March, and Sears has said it plans to convert “hundreds” of Kmart boxes.
Target Revises 2004 Downward
Target Corporation stated that two accounting changes will reduce its earnings for the fourth quarter and full year of 2004. Financials for both periods are expected to be made public on Feb. 17.
Target will adjust its accounting for leases related to owned-store locations located on leased land. The effect will be a $65 million non-cash adjustment, primarily attributable to an increase in Target's year-end straight-line rent accrual. The change will increase the company's pre-tax occupancy costs for the fourth quarter and full year 2004, reducing earnings per share by about 4 cents.
Also impacting earnings will be Target's early adoption in fourth quarter 2005 of SFAS No. 123R, a revised accounting standard for stock-based compensation. It requires that stock-based compensation be accounted for using a fair-value-based method. The shift is expected to reduce 2004 diluted EPS by 2 to 3 cents.
Survey: Retailers Cautious
After a strong holiday season, retail executives are viewing the new year with more caution, according the January NRF Retail Executive Opinion Survey.
The Retail Sector Performance Index (RSPI) for January posted a normal reading of 50.3, 1.6 points lower than the prior month and 14.8 points lower than the same period one year ago. The RSPI measures retail executives' evaluations of monthly sales, customer traffic, average transaction per customer, employment, inventories and a six-month sales-outlook expectation. The RSPI is based on a scale of 0-100 with 50 equaling normal.
Hanover Direct Faces Delisting
Hanover Direct, Inc. has received a letter from the American Stock Exchange stating that the Amex will apply with the Securities and Exchange Commission to remove the company's common stock from the exchange. The action is based on Hanover's failure to regain compliance with the Amex's filing requirements.
Garden Ridge Agrees on Reorg Plan
Garden Ridge has reached an agreement with the Official Unsecured Creditors Committee and Allied Capital Corporation on the terms of a reorganization plan that will enable it to emerge from Chapter 11.
The agreement provides for a $25 million equity infusion to be made upon the plan's effectiveness by investment funds managed by Three Cities Research, Garden Ridge's current equity sponsor.
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