A women’s apparel company that caters to price-conscious consumers announced the closure of 120 retail stores by the end of the fiscal year.
The Cato Corporation, parent company of Cato Fashions, operates more than 1,000 women’s apparel and accessories stores across 31 states. The slated closures account for more than 10% of its stores, Fast Company reported.
Cato, which was founded in 1946, focuses on budget-wary consumers, much like TJ Maxx or Ross Dress for Less.
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The Cato Corporation also operates two other retailers: Versona, an upscale apparel, jewelry, and accessories brand with 90 locations in the U.S., the news outlet reported, and its It’s Fashion and It’s Fashion Metro brands, which have 119 locations in the U.S.
Last week, the Charlotte, N.C.-based corporation announced that it would close 120 stores, an increase from the initial 50 the company originally announced.
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“Annually we review approximately one-third of our stores to exercise available lease options or negotiate an extension based on each store’s performance including store sales trend and current and projected store profitability,” John Cato, the company chairman, president, and CEO, said in a statement.
“In light of the current economic environment, especially with the negative pressure on our customers’ discretionary income, we do not expect these marginal stores to improve appreciably,” he added. “As a result, we are closing more stores than expected this year. We believe that closing these additional stores will have a positive impact on our operating results in fiscal 2027 and beyond.”
In August, the company reported a net income of just $1.1 million for the second quarter, down from $6.8 million the company brought in during the same period a year earlier, the news report states.
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