JACKSONVILLE, Fla. – Winn-Dixie Stores Inc. plans to close 30 underperforming stores. It also plans to consolidate its four operating regions into three plus reduce its workforce by 120 positions at the field and corporate support levels.
Winn-Dixie reaffirmed its guidance for fiscal 2010, which the company believes it achieved through effective management of its promotional activity and cost control, despite a deteriorating sales environment in the fourth quarter. Management plans to hold an investor conference call Aug. 31 to discuss its financial results for fiscal 2010 and provide guidance for fiscal 2011.
“We continue to operate in a particularly difficult economic and retail environment in the Southeast,” said Peter Lynch, Winn-Dixie chairman, chief executive and president. “To respond to these business and economic conditions, we have thoroughly reviewed our retail operations and support structure and have decided to exit certain retail locations and reduce our corporate and field support staffs. We sincerely regret the impact this will have on some of our associates, and we will make every effort to ensure these associates can pursue other open positions or have a smooth and respectful transition.”
The company also plans to eliminate approximately 120 positions in its corporate and field support staffs.
Winn-Dixie expects to achieve annualized savings ranging from $12 to $17 million as a result of these actions, which should begin to be realized after the end of the first quarter of fiscal 2011 due to timing and transition costs. Store closures and position eliminations are expected to be completed by the end of the first quarter of fiscal 2011, which ends on Sept. 22.
“The actions we are taking today will enable us to lower our cost structure, improve efficiency and build the right foundation for our business now and in the future,” Lynch said. “With nearly half of our store base already remodeled, and with plans in place for additional remodels and new store openings, we are confident we will continue making significant progress with our ‘Fresh & Local’ strategy and business initiatives.”