Pep Boys loss widens; stores close
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Automotive parts and service chain Pep Boys-Manny, Moe & Jack posted a wider fiscal third-quarter loss Tuesday and said it closed 31 stores, including three in California, and cut its workforce by about 550 employees, or about 3%.
Stores in Santa Ana, Santa Barbara and Santa Maria were among those closed. The chain now has 561 stores.
For the 13 weeks ended Nov. 3, the Philadelphia company said its loss from continuing operations, before the cumulative effect of a change in accounting principle, increased to $21.65 million, or 42 cents a share, compared with a loss of $10.7 million, or 20 cents a share, in the year-earlier quarter ended Oct. 28.
Sales fell to $535.4 million from $550.85 million. Same-store sales, or sales at stores open at least a year, were down 2.9%.
The company said its third-quarter operating loss was $28.5 million, attributed mainly to $42.1 million in pretax charges for inventory write-downs, executive severance, and legal settlements and reserves, as well as a $3.8-million benefit.
In the fourth quarter, Pep Boys expects to take an additional pretax charge of about $17 million on its store closings.
Pep Boys expects continued pressure on its business, resulting in reduced sales as it sells down noncore merchandise.
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