Dressbarn’s owner Ascena Retail Group said Monday its closing all of its roughly 650 stores, as it hopes to stabilize its business.
Ascena has built up a portfolio of apparel brands over the past decade through acquisitions, including plus-size retailer Lane Bryant and women’s apparel brand Ann Taylor. But as shopping has shifted online and styles have evolved, Ascena has been grappling with sagging sales and a large debt-load.
Same-store sales for the year ended July 2018 were down 2%, according to Factset. The company had $1.33 billion in total debt, in the same period. Shares of the company, which have a market value of $214.4 million, are down 55% year-to-date
Looking to stem the losses, Ascena is turning to pruning its less successful brands.
“We are committed to addressing performance at our under-performing brands, and continue to explore opportunities within our portfolio that can allow us to focus capital and management attention on those brands that we believe can deliver sustained growth and profitability by maintaining a differentiated position in the marketplace,” said former CEO David Jaffe in March.
Jaffe retired as CEO and chairman earlier this month. He was replaced as CEO by Gary Muto, who previously was president and CEO of Ascena Brands.
Dressbarn generated $164 million in sales in the second quarter of 2019, down 7% from the same quarter a year prior. Its sales that quarter represented roughly 10% of Ascena’s overall brands.
Ascena, which did not lay out a timeline for the Dressbarn closures, said in a statement Monday customers can continue to shop online and in-stores, where they can get “even better deals and value.”
Ascena earlier this month completed the sale of its Maurice’s brand to an affiliate of OpCapita for roughly $300 million.