Children's Place furloughs salespeople, halts dividend
Children's Place Inc. said late Tuesday it will furlough field managers and store employees starting April 5 "until they can safely return to their positions" and will suspend dividend and share buybacks, among other measures to shore up its balance sheet amid the coronavirus pandemic. Stores have been closed since March 18 and will remain closed until further notice, the retailer said. The company said it plans on a combination of temporary furloughs and pay cuts for most of its corporate staff. It said it will provide health benefits to furloughed sales associates, without specifying a timeframe. Chief Executive Jane Elfers will forgo her salary and executives will take a temporary 25% pay cut, the company said. The Children's Place is also cutting or deferring expenses and capital expenditures, working with vendors to extend payment terms, and triggering a feature on its revolving credit facility to get an additional $50 million in liquidity, it said. It is also "evaluating its options" on about 600 store leases up over the next 12 months, it said. "The company believes these actions ... will support the company in navigating through this unprecedented level of uncertainty and disruption," it said in a statement. As of Feb. 1, the company operated 924 stores in the U.S. and Canada plus its online store and international points of distribution. Shares of Children's Place were flat in the extended session Tuesday after ending the regular trading day up 1.5%.
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