Williams-Sonoma Inc. will lay off 1,400 employees (about 18% of its workforce) and close its Camp Hill, PA call center and Memphis, TN distribution center, all as part of an effort to cut overhead costs by $75 million.
These cuts will be completed by Jan. 31
The direct marketer and retailer said it expects to incur a pre-tax charge in the fourth quarter of fiscal year 2008 of about $15 million related to these actions.
Including this charge, the San Francisco company still expects to deliver fourth quarter diluted earnings per share at the lower end of the company’s previously announced guidance range of 10 cents to 30 cents per diluted share.”
In fiscal 2009, the company expects these actions to reduce employment and occupancy expenses by approximately $60 million.
Williams also expects to further reduce costs by $15 million by reducing catalog circulation by 15 to 20% and reducing supply chain operations and information technology expenses.
“All of these initiatives will allow us to maintain our financial flexibility, while at the same time focus on those strategic objectives that will enhance our competitive positioning when these macro headwinds subside,” said CEO Howard Lester, in a statement.
