Openings, Closings, & Other Key Industry Highlights

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Whole Foods

Last week, Whole Foods opened a new store Newark, NJ. The 29,000 square-foot supermarket anchors the renovated Hahne’s building, which opened last month after being closed for 30 years. Many Newark residents and officials have labeled the store as a symbol of growth and hope in the city’s downtown area. There are seven competing food retailers within three miles of the new store, including two C-Towns, Acme, Bravo Supermarkets, Key Food, Save-A-Lot and Western Beef.

Whole Foods is also planning to launch a Brazilian churrasco (beef or grilled meat in Portuguese) restaurant in its Ponce de Leon store in Atlanta, GA later this year. The in-store eatery is tentatively called “The Roast” and is part of the store’s remodel. Plans for the location include billiards, a DJ platform, as well as digital-ordering kiosks. The unit will seat about 50 people.

Click here for Whole Foods' full store list.

Ahold Delhaize

Last week, Ahold Delhaize reported solid financial results in the fourth quarter of fiscal 2016, reflecting strength in Delhaize’s U.S. operations combined with synergies resulting from the July 2016 merger, offset somewhat by sales weakness at Ahold’s U.S. banners. At Delhaize America, comps increased 2.2%, as both Food Lion and Hannaford reported positive comp growth supported by volume growth, which more than offset the negative impact of deflation on sales. Meanwhile, Ahold USA’s comps (excluding gasoline) declined 0.2%, reflecting the negative impact of a deflationary market offset somewhat by growth resulting from competitive closures in the Stop & Shop New York metro market during fiscal 2015. In addition, with regard to online sales, management noted that capacity and order volume increased 25% at Peapod’s Jersey City, NJ facility, while PodPass, its annual subscription service, grew its customer base 14%. Finally, Hannaford To Go added about 34 pick-up points in five states.

Click links above for full store lists.

Publix

Publix’s fourth quarter sales jumped 11% to $9.10 billion with an additional week in 4Q16 increasing sales by 7.4%. Comps were up 2.2%. Net earnings increased 4.5% to $544.5 million, benefiting from the extra week. For fiscal 2016, sales rose 5.9% to $34.27 billion, comps increased 1.8%, and net income was up 3.1% to $2.03 billion. During fiscal 2016, the Company opened 15 supermarkets in Florida, eight in North Carolina, three in Georgia, three in South Carolina, two in Alabama and one in Tennessee. Ten supermarkets were closed during the period. Its total store count as of December 31 was 1,136, a net increase of 22 compared to last year.

Click here for Publix's full store list.

Macy's

Macy’s completed the sale of its downtown Minneapolis, MN property to 601W Companies, which is planning a major mixed-use redevelopment for the building. The Company signed the $59.0 million cash agreement on January 4, 2017 and began final clearance sales on January 9. Sales are expected to run until late March, before the store closes in the spring. Going forward, Macy’s will not operate a downtown Minneapolis store, but it will continue to operate eight other stores in the Twin Cities, including six department stores and two furniture galleries. It will record a gain for the property of approximately $47.0 million in the first quarter of 2017.

Click here for Macy's full store list.

hhgregg

hhgregg, DIP filed a voluntary Chapter 11 petition in the U.S. Bankruptcy Court in the Southern District of Indiana. A judge has not yet been assigned to the case. The proceedings have been assigned case number 17-01302-11. According to the Company, it has signed a term sheet with an anonymous party to purchase hhgregg’s assets, which is intended to allow the Company to exit Chapter 11 debt free with significant improvement in liquidity for the future stability of the business: “The Company expects a quick and smooth process through Chapter 11 with emergence in approximately 60 days.” The Company has obtained a committed $80.0 million debtor-in-possession (DIP) financing facility underwritten by Wells Fargo Bank and GACP Finance Co. Subject to Court approval, hhgregg expects that this DIP financing, combined with the acquiring party’s investment and the Company’s cash from operations, will provide sufficient liquidity during the Chapter 11 process to support its continuing normal business operations and minimize disruption. Documents in the filing state that hhgregg believes that after administrative expenses are paid, no funds will be available for distribution to unsecured creditors. Coverage of the proceedings will now be shifted to our Insolvency Support Center.

hhgregg plans to close 88 of its 220 stores and three distribution facilities, to “improve liquidity and return to profitability.” The Company will be exiting the states of Virginia, Delaware, Louisiana, New Jersey, Mississippi and West Virginia as well as vacating most of its stores in Pennsylvania and Maryland. Management said this will help the Company refocus efforts on its core markets and its goals to enhance customers’ experience both in-store and online.

Click here for hhgregg's full store list.

Best Buy

Best Buy’s fourth quarter sales decreased 1% to $13.48 billion, and comps slipped 0.7%. Domestic revenue of $12.30 billion decreased 1.4% compared to last year, driven by a comp decline of 0.9% and the loss of revenue from 11 large-format and 31 Best Buy Mobile store closures. Best Buy’s appliance business could be one of many beneficiaries of hhgregg’s recent announcement that it will close 40% of its store base. 192 of hhgregg’s 220 stores overlap 196 of Best Buy’s 1,026 domestic big box stores within a three mile radius. This implies that the business from 87% of hhgregg’s stores could be within the grasp of nearby Best Buy locations (about 19% of Best Buy’s store base). The close proximity to Best Buy’s stores occurred as a consequence of hhgregg’s “opportunistic” (at the time) acquisition of the Circuit City store leases at below-market rates in 2008. The significant overlap has obviously been a competitive disadvantage to hhgregg since its rapid expansion eight years ago, evidenced by its 50% cumulative reduction in comps since 2008. However, to put the issue in a broader context, Best Buy controls a relatively small portion of the entire appliance market, with significant competition from Sears, Lowes and Home Depot.

Click here for Best Buy's full store list.

Safeway

On March 1, Albertson’s Safeway division introduced its new Safeway Community Markets banner in the Northern California towns of Berkeley (2), Los Altos and San Anselmo. This banner is being used on former Andronico’s Markets stores, which Safeway purchased in November 2016. Safeway purchased five stores; four are being reopened under the new banner. According to Safeway, the banner “will keep alive the heritage of a local specialty market and provide customers with unique offerings.” The stores will carry thousands of local items, and the Company noted that it is “California’s largest local produce buyer.” Safeway currently operates 282 stores in Northern California, Nevada and Hawaii.

Click here for Safeway's full store list.

Casey's General Stores

In the third quarter of fiscal 2017, Casey’s reported total sales growth of 13%, to $1.77 billion, with each segment posting revenue gains. Grocery and Other Merchandise comps were up 3%, with an average margin of 31.1%; Prepared Food and Fountain comps were up 5.8%, with an average margin of 61.7%; and comp gallons of fuel sold were up 2.6%, with an average margin of $0.179 per gallon. Fuel margin was slightly below last year, primarily due to rising wholesale costs throughout most of the quarter, partially offset by an increase in renewable fuel credit sales. Despite the increased sales, overall gross margin contraction, combined with a 12.6% rise in operating expenses resulting from increased payroll due to more stores in operation and wage rate increases, led to a 40.1% decline in net income. President and CEO Terry Handley commented, “Although pressures in our operating area persisted throughout the quarter, the Company continues to be an industry leader in same-store sales growth." Year to date, the Company built and opened 24 new stores, acquired 14, completed 19 replacements, and remodeled 56 stores. It currently has 33 new stores, 21 replacement stores, and 46 major remodel stores under construction. The Company has 91 sites under agreement for future new-store construction and eight acquisition stores under contract to purchase.

Click here for Casey's General Stores' full store list.

Big 5 Sporting Goods

Big 5 Sporting Goods reported fourth quarter sales decreased 3.2% to $266.3 million, while comps were up 3.1%. Profit rose 80% to $7.7 million. CEO Steven G. Miller commented, “We are pleased to report a strong finish to fiscal 2016, with solid same store sales, expanded gross margins, expense leverage and meaningful earnings growth in a challenging holiday sales environment. Our fourth quarter benefited from the competitive rationalization in the retail sporting goods sector, and we increased both customer transactions and average sale as well as improved merchandise margins. For the first quarter to date, our same store sales are up in the mid-single-digit range, largely driven by strong demand for winter products as a result of very favorable winter weather conditions throughout most of our Western markets. We also continue to benefit from the competitive store closures, both from a sales and margin standpoint.” During the fourth quarter, the Company opened one new store and closed one underperforming store, ending with 432 stores in operation. Looking to fiscal 2017, the Company expects to open eight new stores and close three underperforming locations.

Click here for Big 5 Sporting Goods' full store list.

Office Depot

Office Depot’s fourth quarter sales decreased 1.5% to $2.73 billion, and comps were down 4%. EBITDA was $151.0 million in the 2016 fourth quarter, up 0.7% from $146.0 million for the same period last year. Net income totaled $80.0 million in the fourth quarter compared to $15.0 million for the same period last year. Looking ahead, management stated, “Office Depot expects total Company sales in 2017 to be lower than 2016, primarily due to the impact of store closures, prior year contract customer losses, one less selling week and continued challenging market conditions. However, the Company expects the rate of sales decline to improve throughout 2017 based on improvements in customer retention, implementation of new customer wins and continued growth in the contract channel sales pipeline.” In mid-2016, Office Depot completed the closures of 400 stores under a multi-year plan. In August 2016, the Company announced a second store-closure plan that included the anticipated closing of an additional 300 stores over the next three years. On March 1, 2017, the Company announced that it closed 72 stores under the second plan during 2016 (for a total of 123 stores closed in 2016 under both programs); it anticipates closing 75 stores during 2017 and the remainder of the 300 stores in 2018. The Company is also converting existing stores to a smaller format. Many of these stores occupy 15,000 square feet, which is lower than the existing average. Through the end of 2016, the Company has converted 25 locations to this new format, and it anticipates converting about 100 stores by the end of 2017. At December 31, 2016, the Company operated 1,441 stores in North America.

Click here for Office Depot's full store list.

Future Retail Store Closings

AggData monitors upcoming retail store closings throughout the day and maintains an active database of store locations and anticipated closing dates. Here is a sample of recently announced store closings.

Please contact AggData to request a full future store closing list.

Sprouts & ALDI

Following the very recent closures of a Whole Foods and Kroger in Augusta, GA, Sprouts and ALDI both announced plans to open there. Sprouts has proposed a store in the Crane Creek shopping center in an area that has been without a full-service grocery store since the closing of Winn-Dixie in 2005. ALDI has filed plans to build its fourth store in the area. Its other nearby locations are in North Augusta, Aiken and Augusta. Lidl has also made plans for stores in the metro Augusta area, with locations in North Augusta and Augusta already underway and a third in the works.

ALDI is opening its second Ventura County location in Oxnard, CA. The 20,000 square-foot store has received an alcohol permit; according to the Company, alcohol is expected to take up about 5% of the store’s floor. ALDI has 34 locations in the state, all of them in Southern California. The closest unit to the Oxnard store is in Simi Valley, a store that opened in June.

An ALDI store in Newark, OH is undergoing extensive remodeling and will close for about five weeks, beginning March 26, for renovations. The remodeled store will feature an expanded floor model, a focus on fresh items, a modern design, open ceilings, natural lighting and environmentally friendly building materials. There is a nearby location in Heath. ALDI recently announced a $1.60 billion investment strategy, which includes an extensive plan to remodel and expand more than 1,300 U.S. stores by 2020. Its remodeled stores will include more robust produce, dairy and bakery sections as well as expanded alcohol departments. Aldi has 1,600 stores in 35 states and expects to have about 2,000 stores by the end of 2018. It has a growth plan for 650 new stores per year. ALDI announced it will invest $3.00 billion for land, facilities and equipment to open the new stores. Meanwhile, the Company will open its third Spartanburg, SC store on March 16.

Click links above for full store lists.

Radioshack

Published reports indicated that General Wireless Operations Inc., the parent of RadioShack, is in discussions with partner Sprint Corp. and potential strategic investors about reducing RadioShack’s footprint and potentially seeking a formal restructuring as soon as this week. According to the reports, the chain has already started closing roughly 200 stores and laying off “dozens” of employees at its Fort Worth, TX headquarters. RadioShack previously filed Chapter 11 in February 2015, seeking to restructure about $1.00 billion in debt. It sold its brand name and 1,700 stores to Standard General for about $26.0 million, and struck an agreement with Sprint to use about one third of available floorspace at certain stores to sell Sprint phones and accessories.

Click here for RadioShack's full store list.

Beacon Roofing Supply

Beacon Roofing Supply acquired Acme Building Materials, Inc., a distributor of residential roofing and related building products with three branches in Flint, Rochester Hills and Brighton, MI. The three branches bring the number of Beacon locations in Michigan to 10. Acme’s president and co-owner, Lori Tesner, will remain with the Company. Beacon operates 375 locations in 47 states in the U.S. and six provinces in Canada.

Click here for Beacon Roofing Supply's full store list.

King Kullen

Two underperforming King Kullen stores located in Syosset and Commack, NY will close on March 30, after 20 years in business. The Company said it does not expect to shutter any more locations.

Click here for King Kullen's full store list.

Giant Eagle

Giant Eagle closed three of its Columbus, OH stores on March 3. Giant Eagle announced plans to close the stores along with two others in Cleveland, including one GetGo location, back in January. Giant Eagle called the decision to close the stores a “difficult but necessary” one. According to Nielsen, as of January 2017 Giant Eagle operated 25 stores in the Columbus, OH metro area, including two Market District stores. Kroger is the market leader with 62 stores and a 43.5% market share. Walmart operates 19 stores and has a 14.3% market share and Meijer has 11 stores and a 9.2% market share. The Columbus, OH area is highly congested with numerous retailers vying for the grocery dollar.

Click here for Giant Eagle's full store list.

American Eagle Outfitters

American Eagle Outfitters reported fourth quarter sales decreased 0.8% to $1.10 billion, while comps were up slightly compared to a 4% increase in the prior year. Profit fell 33.1% to $54.6 million, negatively impacted by asset impairment and restructuring charges totaling $21.0 million related to its owned and operated stores in the U.K., China and Hong Kong; the Company expects to incur additional restructuring charges in fiscal 2017. CEO Jay Schottenstein commented, “The American Eagle brand continued its strong leadership in jeans and bottoms and has experienced accelerated growth in women's apparel. Aerie posted double-digit sales growth throughout 2016, fueled by superior merchandise, a strengthening customer base and growing brand awareness.” During the quarter, the Company opened two AE stores and closed 11 underperforming AE stores. In addition, there were six Aerie standalone locations opened and one underperforming Aerie store closed. The Company ended the year with 943 AE stores and 102 Aerie stores.

Click here for American Eagle Outfitters' full store list.

Meijer

Meijer announced it is investing more than $375.0 million in new and remodeled stores this year across its six-state footprint, including its first stores in Michigan’s Upper Peninsula and the Green Bay, WI, market. The investment includes the construction of seven new Meijer supercenters and 22 different remodel projects. While Michigan, Indiana and Wisconsin will each welcome new Meijer supercenters later this year, dozens of other Meijer stores have begun or will soon begin remodel projects. By the end of 2017, Meijer will have added more than 50 new stores and remodeled and upgraded nearly 90 stores (since 2010). The new Meijer supercenters opening in 2017 will be in Escanaba and Sault Ste. Marie, MI; McCordsville and Franklin, IN; and Greenfield, Howard (Green Bay) and West Bend, WI. In addition to the new supercenters, Meijer says it is aggressively remodeling stores in five different states, including key markets like Detroit, Cincinnati, Louisville and suburban Chicago. Six Meijer supercenters in Michigan alone will be updated, with the stores in Mt. Pleasant, Commerce Township and Algoma Township slated for major remodels.

Remodels include a variety of specific store enhancements, including improved store layouts, expanded grocery and health and beauty sections, as well as lighting, heating, refrigeration and parking lot improvements. Additionally, the introduction of newer technology in key areas during the remodel process will result in more energy-efficient stores. Meijer operates more than 230 stores throughout Michigan, Ohio, Indiana, Illinois, Kentucky and Wisconsin.

Click here for Meijer's full store list.

Ascena Retail Group

Ascena Retail Group’s second quarter sales decreased 5.1% to $1.75 billion, and comps were down 4%. Premium fashion (Ann Taylor and LOFT) comps were down 5%, value fashion (maurices and dressbarn) comps fell 6%, plus fashion (Lane Bryant and Catherines) comps decreased 4% and kids fashion (Justice) comps were down 1%. Net loss widened more than 55% to $35.2 million, primarily due to a decline in gross margin dollars in the value and kids fashion segments, offset in part by synergies and cost-savings initiatives in the premium segment. CEO David Jaffe commented, “Reflecting on our second quarter results, we saw a continuation of trends that have been in place for some time. While we remain generally pleased with selling performance during peaks, our base business remained soft due to ongoing store traffic headwinds and overall customer price sensitivity, which have become persistent issues impacting our larger sector. While our second quarter comp sales were in line with our guidance, we were forced to be much more promotional than planned to achieve this level of performance.” The Company opened 13 new stores and shuttered 55 underperforming locations, ending the quarter with 4,878 locations in operation.

Click links above for full store lists.

Finish Line

On March 1, The Finish Line completed the process of exiting its unprofitable JackRabbit business, formerly known as Running Specialty Group. Private equity firm Critical Point Capital now owns JackRabbit, including its 65 retail stores currently operating under several banners, its leasehold interests and lease liabilities, intellectual property and trademark and name. Finish Line acquired the assets of the then 18-store chain in September 2011 for $8.5 million. The chain grew as the Company acquired mom-and-pop performance running shoe shops throughout the U.S. and consolidated them under the JackRabbit banner.

Click here for The Finish Line's full store list.

 

Walmart

Walmart, having made a series of acquisitions of e-commerce companies in recent months in an effort to upgrade both its technology and consumer offerings, continues to be on the hunt for additional purchases. The Company’s e-commerce chief, Marc Lore, recently stated, “We’re open and looking at all possible opportunities to enhance customer-value proposition and expand our merchandising expertise and brand relationships. So there’s a lot of categories that fit that description and we’re actively looking.” Mr. Lore, of course, was the founder and CEO of Jet, which Walmart purchased last fall for $3.30 billion.

Click here for Walmart's full store list.

Target

Subsequent to Target’s fourth quarter earnings release in which the Company reported sales fell 4.3% and comps declined 1.5%, management outlined its strategy for the future. Target plans to invest more than $7.00 billion over the next three years. These investments will also take $1.00 billion out of the Company’s operating margin annually. It plans to revamp more than 100 stores in 2017 and more than 600 by 2019. Among other initiatives, the retailer will open 30 small-format stores in 2017, doubling its presence in urban markets and on college campuses. By 2019, Target will operate more than 130 smaller stores. CEO Brian Cornell, said. “We’re putting digital first and evolving our stores, digital channels and supply chain to work together as a smart network that delivers on everything guests love about Target, including more than a dozen new brands we’ll introduce over the next two years.”

Click here for Target's full store list.

Big Lots

Big Lots reported fourth quarter sales fell 0.3% to $1.58 billion, a result of comps growth of 0.3% offset by a lower store count year-over-year. As of the end of the fiscal year, the Company operated 1,435 stores, a net decrease of 14 stores compared to last year. Net income fell 4.7% to $90.1 million. For fiscal 2016, sales increased 0.2% to $5.20 billion, comps rose 0.9%, and net income increased 7% to $152.8 million.

Looking ahead at fiscal 2017, the Company expects EPS of $3.95 – $4.10, an increase of 9% – 13% over fiscal 2016, comp growth of 1% – 2%, and cash flow of $180.0 million – $190.0 million.

In a subsequent earnings call, CEO and President David Campisi said Big Lots will test its ‘store of the future’ in two markets this year: “We’re looking for a fresh perspective. We want a fun, engaging shopping experience.”

Click here for Big Lots' full store list.

Dollar Tree

Dollar Tree reported fourth quarter sales growth of 5% to $5.64 billion. System-wide comps increased 1.2% on a constant currency basis, driven by increases in customer count and average ticket. Comps for the Dollar Tree banner increased 2.3% and rose 0.2% for the Family Dollar banner. Net income rose 40.5% to $321.8 million. During the quarter, the Company opened 104 stores, expanded or relocated 27 stores, and closed 55 stores. Additionally, the Company opened eight former Family Dollar locations as new Dollar Tree stores. For fiscal 2016, sales increased 33.7% to $20.72 billion, and net income more than tripled to $896.2 million. During fiscal 2016, the Company opened 584 new stores. As of January 28, Dollar Tree operated 14,334 stores across 48 states and five Canadian provinces. Looking ahead at fiscal 2017, Dollar Tree expects sales of $21.94 billion – $22.33 billion, based on flat to low single-digit comp growth. EPS is expected to be $4.20 – $4.56, compared to fiscal 2016 EPS of $3.80 in fiscal 2016.

Click here for Dollar Tree's full store list.

 

The Michaels Companies

The Michaels Companies reported fourth quarter sales increased 4.1% to $1.75 billion, which the Company attributed to sales from a net 19 additional stores acquired through the acquisition of Lamrite West in February 2016. However, comps were down 1%, driven by a decrease in customer transaction, partially offset by an increase in average ticket. Profit rose 6.3% to $195.3 million. During the fourth quarter, the Company opened two new Michaels stores and one new Aaron Brothers store; it also shuttered four underperforming Aaron Brothers. CEO Chuck Rubin commented, “We reported fourth quarter results within our initial guidance, and I am encouraged that we delivered market share gains and increased earnings. Looking back on the year, I am pleased we increased our free cash flow to $450.0 million and utilized the strength of our balance sheet to deliver value to our shareholders. Importantly, we made progress against each of the priorities of our Vision 2020 strategy, which is our long-term strategy to increase market share and drive shareholder return.” Looking to fiscal 2017, the Company plans to open 18 new stores (17 Michaels and one Pat Catan) and close up to 10 Aaron Brothers locations. This represents a slower pace of growth compared to fiscal 2016, when the Company opened 36 new stores (32 Michaels, one Aaron Brothers, and three Pat Catan’s) and shuttered 14 underperforming stores (five Michaels and nine Aaron Brothers).

Click here for Michaels' full store list.

The following is a small sample of retail and restaurant Chapter 11 filings since the beginning of the year. If you are interested in receiving a daily list of all commercial Chapter 11 filings filtered by industry along with a direct link to the petition/creditors list, please click here.

1. hhgregg (03-6-2017)

2. Limited Stores, LLC (01-17-2017)

3. Osborn Restaurant Holdings LLC (01-23-2017)

4. Luke’s Locker, Incorporated (01-24-2017)

5. The Wet Seal, LLC (02-02-2017)

6. Emerald Coast Eateries, Inc. (02-03-2017)

7. Eastern Outfitters LLC (02-05-2017)

8. Michigan Sporting Goods Distributors, Inc. (02-14-2017)

9. Mahopac Farms LLC (02-16-2017)

10. Texas Land & Cattle Steak House of North Carolina, Inc. (02-18-2017)