Struggling appliance and electronic retailer HHGregg is planning to close 88 of its weakest stores as part of an effort to stay afloat.
The Indianapolis-based company on Thursday also announced it is closing three distribution centers. The closings, which do not include any stores in Indiana, will be completed by mid-April and result in about 1,500 layoffs.
“We are strategically exiting markets and stores that are not financially profitable for us,” HHGregg CEO Robert Riesbeck said in a statement. “This is a proactive decision to streamline our store footprint in the markets where we have been, and will continue to be, important to our customers, vendor partners and communities."
The announced store closings, which amount to 40 percent of all locations, come days after the New York Stock Exchange delisted HHGregg for failing to meet the minimum listing requirement. Bloomberg last week reported HHGregg is preparing to file for bankruptcy as soon as this month.
HHGregg has lost market share to online retailers while also having to compete against traditional big-box stores such as Best Buy. The company in recent months has tried to reinvent itself as a high-end appliance store. It's the seventh-largest appliance retailer in the U.S. behind Lowe's, Home Depot, Sears, Best Buy, Sears Hometown and Walmart, according to the consumer electronics trade publication Twice.
HHGregg, which has lost money for the last two years, recently reported a dismal holiday shopping season. Sales at stores that have been opened for at least a year declined by 22.2 percent during the most recent fiscal quarter, which included the holidays.
HHGregg in mid-February hired Stifel, Nicolaus & Co. and Miller Buckfire & Co. to find ways to "improve liquidity and return to profitability."
The store closings will bring HHGregg's footprint down to 132 stores, which Riesbeck said "will continue to be a dominant force in appliances, electronics and home furnishings."
An HHGregg spokeswoman said Riesbeck was unavailable for comment.
HHGregg will close stores in 15 states: Alabama, Delaware, Florida, Georgia, Illinois, Louisiana, Maryland, Missouri, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia and West Virginia.
In addition, the company is closing distribution centers in Brandywine, Md., Miami and Philadelphia.
“We have determined that the economics of the affected locations will not allow us to achieve our overall goal of becoming a profitable company again," Riesbeck said. "After scrutinizing our real estate portfolio, we have identified a number of underperforming stores, as well as store locations that are no longer strong shopping destinations due to changes in the local retail shopping landscape.”