PVH to Close 162 Outlet Stores, Reduce Office Workforce by 12 Percent
NEW YORK CITY — In a move to streamline its North American operations and adapt to an evolving retail landscape that has been accelerated by the COVID-19 pandemic, PVH Corp. (NYSE: PVH) announced Tuesday that it will close all of its 162 Heritage Brands outlet stores and reduce its office workforce by approximately 450 positions, or 12 percent.
PVH’s Heritage Brands include Van Heusen, Izod, Arrow, Warner’s, Olga and Geoffrey Beene. The Heritage Brands retail locations are expected to operate through mid-2021.
The workforce reductions, which are spread across all three brand businesses of Tommy Hilfiger, Calvin Klein and Heritage Brands, are expected to result in annual cost savings of approximately $80 million.
“The structural changes occurring in the North American retail landscape have required us to take a hard look at our North American operations and identify where we can optimize costs across our business model,” says Manny Chirico, chairman and CEO of PVH. “We did not take these decisions lightly, as our Heritage Brands retail business is our oldest retail business, yet no longer met appropriate return metrics.”
Stefan Larsson, president of PVH, says that the COVID-19 crisis is dramatically reshaping the retail landscape for the long term in terms of consumer purchasing behavior. “We are adapting our businesses and rebalancing our cost base to improve our competitiveness and financial profile and, where appropriate, are reallocating resources to our businesses that drive greater returns,” he says.
New York City-based PVH has roughly 40,000 associates operating in more than 40 countries. In 2019, the company posted $9.9 billion in annual revenues. PVH’s stock price closed at $46.51 per share on Tuesday, July 14, down from $90.48 one year ago.
PVH’s news comes on the heels of bankruptcy filings from two other apparel retailers — Brooks Brothers and RTW Retailwinds, the parent company of New York & Co.
— Kristin Hiller