Alabama Ace store to close
Reid Ace Hardware, a Huntsville, Ala.-based store known for having hard-to-find merchandise, will close its doors, according to the Huntsville Times.
The business was started in 1962 by Joe and Mary Gene Reid and is now run by their children, Russell Reid and Laurie Bragg. The second-generation owners said they can’t keep the store going following the deaths of Mary Gene in 2004 and Joe last April.
Joe Reid was known for stocking plumbing parts for older fixtures and instructing customers on how to make repairs.
Astore-closing sale is underway with 25 percent markdowns on all merchandise. A final closing date has not been set, according to the article. Another Huntsville-based Ace store, 50-year-old Lily Flagg Supply, closed two years ago.
Target cuts work force
Target has announced a work force reduction of 9 percent at its Minneapolis headquarters, a move that will eliminate approximately 600 employees and 400 open positions. The company will also close its Little Rock, Ark., distribution center, which currently employs 500 people, later this year.
Other cost-cutting actions planned include suspending salary increases for senior management; suspending share repurchase activity; tightening credit card underwriting and credit granting; implementing initiatives to improve store productivity; reducing planned new store openings; and cutting outside contractor support, travel, entertainment and other headquarters operating expenses.
“We are clearly operating in an unprecedented economic environment that requires us to make some extremely difficult decisions to ensure Target remains competitive over the long term,” said Gregg Steinhafel, president and CEO of Target, in a Jan. 27 announcement.
In recent months, Target has experienced weaker-than-expected sales, which is pressuring earnings performance, the statement said. Combined with the outlook for continued difficult economic conditions well into 2009, the company said it is taking a more conservative approach to business planning.
Target currently operates 1,682 stores in 48 states, 34 distribution centers and employs approximately 350,000 people worldwide.
Losses widen at USG
USG, the Chicago-based building products manufacturer, has reported a preliminary fourth quarter net loss for 2008 of $172 million, compared to a net loss of $32 million in the same quarter last year. The most recent year’s figures do not include an expected non-cash charge for impairment of good will and other intangible assets. That amount is “yet to be determined,” according to a company press release.
Net sales for fiscal 2008 were $981 million, compared to $1.2 billion a year ago.
“All of our businesses are being negatively affected by weak macroeconomic conditions,” said William Foote, USG chairman and CEO. “New residential construction, a key market for our wallboard business, is down about 75 percent from its high in 2005.”
The housing market “continues to be very weak,” the company said in its business outlook, and “is expected to remain very weak throughout 2009. That weakness could extend into 2010, especially if the inventory of unsold homes remains at an historically high level, and tight mortgage lending policies remain in place.”
USG’s North American Gypsum business recorded fourth-quarter 2008 net sales of $505 million and a preliminary operating loss of $86 million, which included restructuring and long-lived asset impairment charges of $31 million. For the fourth quarter of 2007, North American Gypsum recorded net sales of $628 million and an operating loss of $53 million.
The decline in USG’s net sales was attributed primarily to lower shipments for Sheetrock-brand gypsum wallboard and non-wallboard products, including joint treatment and performance substrates and surfaces.
L&W Supply and its subsidiaries, which comprise USG’s building products distribution business, reported fourth-quarter 2008 net sales of $435 million, down 16 percent compared to the fourth quarter of 2007. Fourth-quarter 2008 net sales primarily reflected lower gypsum wallboard shipments as a result of weaker residential and commercial construction demand, the company said.