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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
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Date of Report (Date of earliest event reported): January 25, 2000
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VENATOR GROUP, INC.
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(Exact name of registrant as specified in its charter)
New York No. 1-10299 13-3513936
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
233 Broadway, New York, New York 10279-0003
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 553-2000
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Item 5. Other Events.
On January 25, 2000, the Registrant announced a series of steps designed to
further reduce its cost structure and streamline its corporate and divisional
operations to better position itself in 2000 and beyond. The Registrant plans to
(i) close a total of 358 stores that are not meeting performance targets, (ii)
consolidate the managements of Kids and Lady Foot Locker into one organization
and reduce the worldwide Foot Locker divisional staff; (iii) close the Champs
Sports distribution center located in Maumelle, Arkansas and consolidate its
operation with the Foot Locker facility located in Junction City, Kansas, and
(iv) reduce sales support and corporate staff by over 30 percent and move the
corporate offices into its Foot Locker headquarters location in mid-town
Manhattan. The after-tax restructuring charge associated with this announcement
is expected to total $53 million, or $0.39 per share, which will be included in
reported results of the fourth quarter. (See Exhibit 99, which, in its entirety,
is incorporated herein by reference.)
Item 7. Financial Statements and Exhibits.
(c) Exhibits
In accordance with the provisions of Item 601 of Regulation S-K, an index
of exhibits is included in this Form 8-K on page 3.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned being hereunto duly authorized.
VENATOR GROUP, INC.
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(Registrant)
Date: February 2, 2000 By: /s/ Robert W. McHugh
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Robert W. McHugh
Vice President and
Chief Accounting Officer
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VENATOR GROUP, INC.
INDEX OF EXHIBITS
FURNISHED IN ACCORDANCE
WITH THE PROVISIONS OF
ITEM 601 OF REGULATION S-K
Exhibit No. in Item 601
of Regulation S-K Description
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99 News Release dated January 25, 2000
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EXHIBIT 99
NEWS RELEASE
CONTACT: Juris Pagrabs
Vice President, Investor
Relations
(212) 553-7017
VENATOR GROUP TO REDUCE ITS CORPORATE AND DIVISIONAL COST STRUCTURE
- COMPANY TO CLOSE 358 STORES NOT MEETING PERFORMANCE TARGETS -
- CHAMPS SPORTS DISTRIBUTION CENTER TO BE CONSOLIDATED
WITH FOOT LOCKER FACILITY -
- ACTIONS TO FAVORABLY IMPACT ANNUAL PRE-TAX EARNINGS BY $50 MILLION -
NEW YORK, New York, January 25, 2000 -- Venator Group, Inc. (NYSE: Z), the New
York-based athletic specialty retailer, today announced a series of steps
designed to further reduce its cost structure and streamline its corporate and
divisional operations to better position itself in 2000 and beyond. These
actions, together with accelerated closings of underperforming stores, are
expected to favorably impact annual pre-tax earnings by approximately $50
million beginning in fiscal 2000.
"Success in this highly competitive market demands continuous improvement in
cost structure and efficiencies," said Dale W. Hilpert, the Company's President
and Chief Executive Officer. "As the industry leader, we intend to be lean and
financially strong to capitalize on improving athletic footwear trends and to
deliver better returns on sales and greater value to our shareholders. Today's
consolidation allows management to focus on our athletic business and positions
the Northern Group with the opportunity to return to historical operating
profits."
THE COMPANY PLANS TO:
o Close a total of 358 stores that are not meeting performance targets,
consisting of 123 Foot Locker, Lady Foot Locker and Kids Foot Locker
stores, 27 Champs Sports stores and 208 Northern Group stores, which
includes the disposal of all of the Northern Getaway and Northern Elements
stores in the United States. In the aggregate, these stores are expected to
incur an operating loss of approximately $30 million in fiscal 1999;
o Consolidate the managements of Kids and Lady Foot Locker into one
organization and reduce the worldwide Foot Locker divisional staff, thereby
eliminating redundant operations and creating a more cost-efficient
business;
o Close the Champs Sports distribution center located in Maumelle, Arkansas
and consolidate its operation with the Foot Locker facility located in
Junction City, Kansas, which will centralize athletic store fulfillment for
North America, eliminating excess capacity and reducing cost of
merchandise. Our facility located in Wausau, Wisconsin will continue to
provide fulfillment services for eVenator/Eastbay, the Company's catalog
and Internet operations;
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o Reduce sales support and corporate staff by over 30 percent and move the
corporate offices into its Foot Locker headquarters location in mid-town
Manhattan, which will provide an environment that better suits the
Company's needs while functioning in a more cost-effective and efficient
space.
"Our repositioning work is essentially complete, with the exception of the sale
of the San Francisco Music Box, Randy River, the Hospitality business and
several key real estate properties scheduled to be completed in 2000," continued
Mr. Hilpert. "With these announcements today, we become a focused $4 billion
global athletic retailer that is positioned to take advantage of industry
opportunities."
The after-tax restructuring charge associated with today's announcement is
expected to total $53 million, or $0.39 per share, which will be included in the
reported results of the fourth quarter. As previously announced, the Company
will also record in its reported results an after-tax gain on the sale of
Afterthoughts and Australia of approximately $106 million, or $0.77 per share.
Additionally, the Company said that today's consolidations will affect
approximately 600 corporate, divisional and service support associates, as well
as 3,100 store associates, and that they will be provided with severance and
outplacement counseling.
Venator Group is a diversified global retailer that operates over 4,000 retail
stores in 15 countries in North America, Europe and Australia. Through its
athletic group of specialty retail stores, including Foot Locker, Lady Foot
Locker, Kids Foot Locker and Champs Sports, as well as its Internet/direct
marketer eVenator/Eastbay, the Company is the leading provider of athletic
footwear and apparel. Other specialty retail chains include the Northern Group
of apparel stores.
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements, which reflect
management's current views of future events and financial performance. These
forward-looking statements are based on many assumptions and factors including
the effects of currency fluctuations, consumer preferences, economic conditions
world-wide and other factors detailed in the Company's filings with the
Securities and Exchange Commission. Any changes in such assumptions or factors
could produce significantly different results.
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