Chico's FAS (NYSE:CHS) is planning to sell its direct-to-consumer business, Boston Proper, and close the 20 existing stores.
The plans were announced with the company's financial results for the second fiscal quarter of 2015. The retailer reported a net income of $77.3 million, compared to $70 million for the same period in 2014. Sales were also up 1.4 percent for the quarter, reflecting 23 new stores and a 0.5 percent increase in comparable sales.
Chico's is in the midst of a cost-cutting plan which includes lowering capital spending, accelerating store closings, and cutting jobs, Market Watch reported. The move was necessary after Sycamore Partners dropped its bid to purchase Chico's due to financing challenges.
While Chico's namesake brand posted a 1.1 percent rise in sales, its Soma Intimates brand jumped 10 percent in sales.
The company is still looking for a replacement for CEO David Dyer, who plans to retire next spring. Dyer's exit has raised the possibility of a company sale.
In February, Chico's announced a plan to close 120 stores through 2017. However, the company still has plans to expand internationally, both physically and digitally. Last year Chico's announced an expansion of brick-and-mortar stores into Europe and Canada.
To expand its digital reach, Chico's partnered with Borderfree, a developer of international e-commerce. Now the retailer's merchandise is available to online shoppers in 100 countries, including 60 different currencies.
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