J. Crew Group has cut "dozens of positions at its New York corporate headquarters," Women's Wear Daily reported, citing two unnamed sources. In a statement provided to WWD, J. Crew confirmed it had "reduced a limited number of filled and open positions" at its headquarters.
The cuts, which numbered fewer than "hundreds," were only at the namesake J. Crew brand, according to the report. J. Crew didn't immediately return Retail Dive's request for comment.
The J. Crew brand has floundered for years now, and the company has turned to its Madewell label for salvation.
The company in its most recent quarter opened one J. Crew store and 10 Madewell stores, and executives said they will continue to rationalize its footprint, with plans to close about 20 J. Crew and factory stores. Unlike the group as a whole, Madewell has a permanent CEO in place and may be taken public.
J. Crew has had its share of executive upheaval in the last year. Chief executive James Brett left in November after just over a year in the role. There is currently an interim CEO. Mickey Drexler, who stayed with the company for 16 years, had remained as chairman of the board after his time as CEO, but left that position in January.
The company can only ramp up Madewell so fast, however, making expenses cuts a critical way to solve its financial woes, including debt totaling $1.7 billion. As of May 29, there were outstanding borrowings of approximately $198 million under its asset-based lending facility, with excess availability of approximately $113 million. The situation has reportedly prompted the company to seek out another round of debt restructuring after a dramatic debt swap scheme achieved last year.
The group has already intensified its expense cuts. In its most recent quarter, selling, general and administrative expenses fell to $189.8 million or 32.8% of revenues, compared to $200.8 million or 37.2% of revenues in the year-ago period.