- Prachi Singh |
Aéropostale in its business update inclusive of plans to institute a new cost reduction program, while reconfirming the fourth quarter guidance said that as part of its new cost reduction program, it plans to reduce corporate headcount by approximately 100 positions, or 13 percent, by the end of fiscal 2015.
"The decisions that led to today's actions are a result of our focus on Aéropostale's future, and our goal of returning to profitability. The reiteration of our fourth quarter guidance demonstrates sequential improvement from a sales and operating loss perspective," said Julian R. Geiger, Chief Executive Officer of the company.
the company expects new cost reduction program to generate approximately 35 million dollars to 40 million dollars in annualised pre-tax savings which is expected to be achieved in fiscal 2016. The company estimates that it will record pre-tax cash expenses of approximately 1.5 million dollars during fiscal 2015 related to this program.
The company continues to expect fourth quarter 2015 operating losses in the range of 0.0 million dollars to 10 million dollars, which translates to a net loss in the range of 0.04 dollars to 0.17 dollars per diluted share. The company said that this earnings guidance does not include the impact of the aforementioned headcount reductions, and as previously announced, any store impairments, accelerated store closure costs, lease buyout costs, or real estate consulting fees.