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 NEW YORK, Oct. 13 /PRNewswire/ -- Woolworth Corporation (NYSE: Z) announced today a program to reposition certain of its operations in order to best allocate its resources to its most-profitable retail formats. This further enhances the company's Woolworth stores' prominence in major urban centers. It also features the remerchandising and remodeling of some of its Kinney shoe stores, and the conversion of its Woolworth stores in Canada to The Bargain! Shop concept.
 The repositioning requires the closing, over the next several months, of approximately 970 general merchandise and specialty stores in the United States and Canada that have not met the company's financial objectives. These stores represent about 10 percent of the company's worldwide total.
 The stores to be closed incurred $36 million of operating losses during the first half of 1993, an amount equivalent to the operating losses these stores generated for all of 1992. For the twenty-six weeks ended July 31, 1993, these stores accounted for approximately $380 million, or about nine percent, of the company's total revenues of $4,423 million.
 The company expects to redeploy as many as 250 of the 970 stores into other, more-profitable formats, principally those in its various athletic footwear and apparel chains.
 The program is expected result in an after-tax charge of approximately $480 million, or $3.66 per share, against the company's third quarter earnings. The company stated that it expect the cumulative effect of this program on the company's cash flows, on an after-tax basis, will be insignificant.
 William K. Lavin, chairman and chief executive officer, said, "The program, approved today by the board of directors, is consistent with a key strategic priority of the company: the restructuring, reformatting and revitalizing of businesses which can meet the company's financial objectives within a reasonable time span -- and the redeploying of assets away from those businesses which cannot.
 "The continuation of unfavorable economic conditions in the United States and Canada, along with increased competitive pressures affecting customers' shopping habits and the generally depressed consumer-spending environment, have led us to accelerate our store closings," Lavin said. "In addition," he noted, "lackluster back-to-school sales, coupled with the mounting losses of the stores included in the program, are expected to cause third quarter earnings to fall well below those of last year.
 "The program, together with other previously announced expense- control initiatives, such as the combination of various operations, logistics improvements, and the centralization of support functions, will move the company closer to its goal of being a low-cost, customer- driven organization better able to enhance shareholder value," Lavin continued.
 The Woolworth store closings in the United States represent an acceleration of the implementation of that chain's strategy of concentrating its general merchandise stores in larger urban areas. The Kinney shoe chain has been refining its merchandising strategy over the past 18 months, and will be better able to serve its predominantly female customers with a more-fashion oriented, brand name merchandise mix.
 In the United States, approximately 730 stores, including 400, or about half, of the Woolworth general merchandise stores, and 330, or about one third, of the Kinney and Footquarters shoe stores, are slated to close. About 100 of the stores to be closed are expected to be converted to more-profitable formats, such as World Foot Locker athletic footwear and apparel stores, The Rx Place deep-discount drug stores, Northern Reflections women's casual apparel stores, or various other athletic footwear and apparel formats.
 About 100 Woolworth stores in Canada will be converted to the popular The Bargain! Shop concept, introduced in 1991. This chain, which offers a broad assortment of low-priced apparel and household merchandise, will total nearly 200 stores as a result of these latest conversions. In addition, about 50 specialty stores slated to close in Canada will be converted, primarily to stores in the company's "Northern" group: Northern Reflections, Northern Traditions and Northern Getaway, providing casual women's and children's apparel. Specialty store closings in Canada include all of the Fredelle, Willow Ridge and The Best of Times stores as well as selected stores in other chains. In Canada, about 240 stores are affected by the program.
 Only five percent of the total number of stores operated in Canada will be closed permanently.
 The program will eliminate approximately 10,000 jobs in the United States and 3,000 jobs in Canada, evenly divided between full- and part- time positions. This number represents nine percent of the company's total work force.
 During 1993 the company will have opened or acquired in excess of 800 stores worldwide, and will have closed about 1,200 stores, including the 970 stores involved in this program. Preliminary plans for 1994 call for the opening of about 600 stores, including redeployed stores.
 In another action at today's meeting, the board of directors declared a quarterly cash dividend on the company's common stock of $.29 per share, and on the company's $2.20 Series A Convertible Preferred Stock of $.55 per share, both payable Dec. 1, 1993, to shareholders of record on Nov. 1, 1993. These dividends are the same as for the prior quarter.
 -0- 10/13/93
 /NOTE TO EDITORS: Another Woolworth Corporation news release is also being issued today: "Dividends Declared by Woolworth Corporation"/
 /CONTACT: Frances E. Trachter of Woolworth Corporation, 212-553-2394/

CO: Woolworth Corporation ST: New York IN: REA SU:

TS -- NY053 -- 1645 10/13/93 11:55 EDT
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Publication:PR Newswire
Date:Oct 13, 1993

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