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AnnTaylor announces huge losses

ANNTAYLOR Stores Corp posted a loss almost twice as big as Wall Street expected yesterday, weighed down by charges, and said that it would close 46 more stores as women buy less clothing during the recession.

The women's apparel retailer also announced that it had drawn US$125 million of its US$250 million revolving credit facility on Thursday.

AnnTaylor, which has been restructuring for more than a year, called the most recent quarter its "earnings trough."

While the company did not give a specific earnings outlook, it expects sales to be under significant pressure this year, with some improvement in the second half.

The AnnTaylor chain was particularly hard hit, since the professional working women who buy its suits and other corporate attire felt the impact of the financial crisis and rising unemployment, Chief Executive Kay Krill said in a statement.

Krill said that the company had drawn half of the US$250 million facility "as a cushion" in case it needs more working capital for the spring season.

For the fourth quarter ended January 31, AnnTaylor posted a loss of US$58.1 million, or US$1.03 per share, excluding impairments and restructuring charges, compared with a year-earlier profit of US$11.5 million, or 19 US cents per share. Analysts on average had expected a loss of 55 US cents per share, according to Reuters Estimates.

The company said that it now plans to close a total of 163 stores, up from an earlier forecast of 117 stores.


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