West Chester, Pa. - Electronics Boutique Holdings expects to take up to a $16 million pre-tax charge in its fiscal fourth quarter and year ended Feb. 2 for the discontinuation at all EB Kids operations currently conducted in 29 stores, and offer for sale its 22-store BC Sports Collectibles business.
The retailer intends to convert 12 of its EB Kids stores to the Electronics Boutique format, which will be in addition to the 200 new Electronics Boutique stores that the company plans to open over the next year.
The retailer said these measures reflect management's desire to focus its energy and resources exclusively on the significant growth opportunities in the video game industry. Electronics Boutique's worldwide comp-store sales performance for the nine-week holiday period ending Jan. 5 would have been higher if the impact of the EB Kids and BC Sports Collectible stores had been excluded. It now expects an improvement in annualized pretax earnings in excess of $3 million from the restructuring.