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Express Fashion Retailer To Close 91 Stores By 2022

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Fashion apparel retailer Express, Inc. said it plans to close approximately 91 stores by 2022, amid a weakening retail climate. This is apart from the nine stores closed in 2019.

The company also expects 3 percent decline in comparable sales for the fourth quarter.

As part of its EXPRESSway Forward cost-cutting plan, the company has identified opportunities for $80 million of annualized cost reduction, to be realized over the next three years.

Tim Baxter, Chief Executive Officer, said, "My expectation is that we will return to a mid-single-digit operating margin through a combination of low-single-digit comp sales growth, margin expansion and cost reductions. This will of course take some time, but we have a clear path."

The fleet rationalization plan includes closure of 31 stores by end of January 2020, and an additional 35 stores by the end of January 2021.

The plans are expected to hurt the company's sales by $90 million by 2022. On the other hand, the elimination of the fixed operating costs of the closed stores would result in a $15 million annualized increase in EBITDA by 2022.

Majority of brick-and-mortar stores across the country are struggling with slowing foot traffic amid the ever-increasing online competition from industry majors such as Amazon and Walmart, and the changing consumer habits.

Bed Bath & Beyond is closing 60 stores, while Schurman Retail Group plans to close about 254 Papyrus and American Greetings stores.

In early January, department store chain Macy's had decided to close around 15 stores across the country. Pier 1 Imports also recently announced its plans to close up to 450 locations after reporting 11.4 percent drop in the third-quarter comparable sales.

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