Mall staple Express said last week that it plans to eliminate 150 jobs as part of a strategy to cut expenses. The layoffs, which are expected to be completed this fall, will come with charges estimated at around $5 million.
The cuts come as Express embarks on a goal of $150 million in annualized expense reductions by 2025 versus 2022 expenses. Express said in a statement that it expects the job eliminations to generate an approximately $30 million in savings in fiscal 2024.
The company made the announcement along with its preliminary second quarter 2023 financial results, which included net sales numbers expected to be in the previously announced range of $400 to $450 million.
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“Net sales for the Express brand improved sequentially throughout the second quarter driven by the corrective actions we have taken to address imbalances in our women’s assortment architecture,” said Tim Baxter, CEO, Express. “These results give us confidence that we will continue to see improvement in net sales for the Express brand in the back half of the year. Additionally, the integration of the Bonobos brand into our omni-channel platform and its performance are on track.”
Express and WHP Global completed their joint acquisition of menswear e-commerce site Bonobos in May from Walmart for a combined purchase price of $75 million, $25 million of which comes from Express. The acquisition was announced along with the company’s first quarter results, with consolidated net sales down 15 percent to $383.3 million and comparable net sales down 14 percent.
The fashion retailer also announced last week that its board of directors authorized a 1-for-20 reverse stock split of Express common stock. The reverse split is expected to be affected after market close on Aug. 30.
“As we transform EXPR to create shareholder value, we are committed to driving long-term profitable growth and delivering positive free cash flow in our core Express business,” Baxter said. “We are conducting a comprehensive review of our business model to identify actions that we believe will meaningfully reduce pre-tax costs and enable a more efficient and effective organization.”
Job cuts are hitting the industry up and down the supply chain. Layoffs earlier this year landed Gap Inc. in legal trouble while Hanesbrands is cutting U.S. office and cut-and-sew jobs. Nordstrom, David’s Bridal, Bed Bath & Beyond, The Children’s Place, and Qurate are just some of the names trimming staff in a year marked by inflation and muted consumer spending. Retail lost 11,000 jobs in June after adding 23,000 the month prior, according to the government data.
