- Budget fashion retailer The Cato Corporation is closing 120 stores across 31 US states by the end of the fiscal year due to high inflation and elevated fuel costs.
- The company initially planned to shutter 50 locations before increasing the target by an additional 70 stores on 18 September.
- Chief executive John Cato stated that underperforming stores were unlikely to improve given persistent negative pressure on customer discretionary income.
- The store closures are expected to cost between $1m and $1.3m, but the firm believes the move will positively impact operating results from fiscal 2027.
- The decision follows a sharp fall in second-quarter net income to $1.1m, down from $6.8m during the same period a year earlier.
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