PVH Corp., parent company of Calvin Klein and Tommy Hilfiger, is cutting 450 corporate jobs in North America — or about 12% of its workforce — and exiting its Heritage Brand outlet store business.
The 162 retail locations, which include nameplates Van Heusen, Izod, Arrow, Warner’s, Olga and Geoffrey Beene, will operate through mid 2021.
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The company, which continues to grapple with the impact of the coronavirus and deteriorating brick-and-mortar landscape, said the workforce reductions are across all brands and corporate functions. PVH said it expects the moves will save about $80 million annually.
“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,” said Manny Chirico, chairman and CEO of PVH in a statement. “As a result, we are making the incredibly difficult decisions to close our Heritage Brands retail business and eliminate a significant number of positions throughout our North American organization to align with the lower revenue base.”
Chirico said the Heritage Brand business, the oldest part of the company’s retail operations, was no longer meeting metrics needed to continue. “We would like to express our deepest gratitude to all of our impacted associates for their support, loyalty and contributions over the years,” the CEO said.
Stefan Larsson, president of PVH, said the moves will help the company get on a better path. “The COVID-19 crisis is dramatically reshaping the retail landscape in ways that we believe will be long-term in nature and far-reaching in terms of consumer purchasing behavior,” Larsson said. “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.”
PVH posted sluggish first-quarter financial results as retail closures dragged down performance.
For the three months ended May 3, the Calvin Klein and Tommy Hilfiger parent saw a loss of $3.03 per share. The retail group said its stores were shut down for an average of six weeks, spurring revenues to drop 43% to $1.34 billion. Analysts had forecasted a loss of $1.60 and revenues of $1.36 billion.