DUBOIS, Pa. (EYT) — Pat Catan’s in DuBois, along with all of the other store locations, will be closing for good later this year.
The Michaels Companies, Inc. announced its decision today to close all of its Pat Catan’s stores. This includes the following locations in our local region:
- 200 Commons Drive DuBois PA
- 3380 State St. Hermitage PA
Pat Catan’s is a chain retail store dedicated to arts and crafts with 36 stores operating in Ohio, Pennsylvania, and surrounding states.
The Company intends to rebrand up to 12 of the closed Pat Catan’s stores and reopen them under the Michaels banner. The Company also updated guidance for the fourth quarter of fiscal 2018, excluding the impact of any restructuring charges related to the Pat Catan’s store closures.
“We continue to make progress against our long-term strategy to increase market share and expand our leadership position within the arts and crafts industry. In support of this strategy, in 2016 we acquired Lamrite West, a privately-held company in Ohio with a wholesale division, a small sourcing office in China and a small retail chain called Pat Catan’s Arts & Crafts Stores, which was operated as outlets for the wholesale business,” said Chuck Rubin, Chairman and CEO of The Michaels Companies. “Over the last three years, we have delivered value through the significant expansion of our China-based sourcing team and the growth of our wholesale business. However, the Pat Catan’s retail business has struggled in the face of industry headwinds.”
“After a comprehensive review, we have decided to close all of the Pat Catan’s retail stores. We expect to rebrand and reopen up to 12 stores as new Michaels stores in fiscal 2019, and we will continue to maintain a support center and distribution center in Strongsville, Ohio to support our growing wholesale business. We believe these changes will provide more value for customers and shareholders by enabling us to leverage a more consistent merchandise assortment and eliminate duplicative retail operating expenses,” continued Rubin. “This was not an easy decision, and I am grateful for the contributions of our Pat Catan’s Team Members. As we work through the closing process, we intend to provide employment opportunities or transition support for all Team Members.”
Pat Catan’s fiscal 2018 net sales are projected to be approximately $111 million with no material impact on the consolidated Company’s adjusted operating income, excluding the impact of any restructuring charges related to the Pat Catan’s store closures. The Company expects the one-time after-tax cost of implementing these changes will be in the range of $44 million to $48 million, consisting primarily of costs associated with the termination of the remaining lease obligations, the write-off of fixed assets, costs associated with liquidation, and employee-related expenses. The Company anticipates the vast majority of the costs will be recognized in the fourth quarter of fiscal 2018. The Company expects the one-time after-tax cash benefit of the changes will be in the range of $20 million to $25 million in fiscal 2019.
