Circuit City Store Closings Underway

By Alan Wolf -- TWICE, 2/20/2009

UPDATE! Richmond, Va. — Circuit City's liquidators have begun shutting down the chain's 567 remaining stores.

The first round of closings will conclude by March 1, and a federal bankruptcy court here has scheduled an auction for the stores' leases on Feb. 26.

Leases to the remaining stores will be auctioned off on March 10, court documents show, with the winning bidders to be determined on March 3 and March 13, respectively.

The closings are starting about a month ahead of schedule due to the unexpected pace of the fire sales, and should conclude within the next three to four weeks, the liquidators said. About $1 billion in inventory has been sold since the sales began Jan. 17, including 272,700 flat panel TVs; 53,800 home theater systems; 266,600 digital cameras; 79,100 notebook PCs; 38,700 desktop PCs; 143,900 printers; 62,300 camcorders; 92,700 GPS devices; 88,100 car audio speakers; and over 6 million DVDs and CDs.

All of Circuit City's distribution centers are now empty, and the remaining $700 million worth of merchandise has since been moved to the stores.

“Due to the record shopper turnout we’ve had over the past month, we’re ahead of schedule in closing many of the store locations,” noted Scott Carpenter, executive VP and operations director for Great American Group, which has been overseeing the going-out-of-business sales for the joint venture that also includes SB Capital Group, Tiger Capital Group and Hudson Capital Partners.

The consortium described the liquidation as among the largest in U.S. retail history.

This week the bankruptcy court also approved Circuit City's request to hire Liquid Asset Partners, a Grand Rapids, Mich.-based liquidator, to sell off all its furniture, fixtures and equipment from seven distribution centers, four service centers, two corporate offices and one call center.

In other Circuit City news, the company reported losses of nearly $21 million in December on sales of just over $1 billion.

According to a filing with the United States Securities and Exchange Commission, the $21 million loss included an $8 million impairment charge related to long-lived assets at the company's stores.

Circuit City's assets totaled $3.1 billion as of Dec. 31, the filing showed, and total liabilities were $863 million.

The chain’s billion-dollar December followed a bankruptcy filing in November and the closure of 55 stores before Christmas. Results were also impacted by the crises in the financial markets, which stifled holiday sales for all retailers.