Chains face mixed tidings: for Ames Stores: more losses, less leases - Ames Department Stores Inc

Discount Store News, Nov 5, 1990

Chains Face Mixed Tidings

ROCKY HILL, Conn. - Ames Department Stores, still struggling to emerge from Chapter 11, suffered more setbacks this fall, as a general retail slump impacted its sales and profits. Also, only four of 99 leases from closed stores were purchased during an early October auction.

Losses for the second quarter mounted to $152.5 million on sales of $563 million, including a $73 million non-recurring charge to income related to prefiling costs and a further $9 million write-off for computers and computer equipment installed in closed units.

According to the company, active bidding for the leases was restrained by the near-market price the company was forced to ask, as well as a declining real estate market industrywide. However, the companny said it has contracts or is close to agreements for some 44 of the 99 leases, and will re-auction the remaining leases at the end of October, after presstime.

The company also announced the closing of its West Hartford, Conn., and Syracuse, N.Y., corporate offices, effective next spring. The closings will affect some 250 active employees and all accounting and other functions of the two offices will be moved to the Rocky Hill headquarters according to chairman Stephen Pistner.

"Both the staff reduction and office consolidation are essential elements of our plan to reduce expenses and operating losses, while matching Ames' corporate organization with the company's smaller size," Pistner said.