Delray, Boynton stores to remain open as Linens 'n Things files for Chapter 11

By DAVID SEDORE, Palm Beach Business.com

DELRAY BEACH — Financially ailing Linens ‘n Things is closing 120 “underperforming” stores nationally as part of its bankruptcy reorganization plan.

But its Delray Beach store won’t be one of them. And neither will it Boynton Beach store, according to the company.

Its Boca Raton store, however, has gotten the ax. The Clifton, N.J.-based chain also is closing stores at the Cross County Plaza in West Palm Beach and a store in Adventura.

Before the closings, Linens ‘n Things operated more than 500 stores in the U.S. and Canada, including 48 in Florida, 17 of which are in South Florida.

Linens ‘n Things will close six of its Florida locations.

In a news release, Chairman Robert J. DiNicola blamed the slow economy, especially the ailing housing and credit markets for the company’s woes.

“The decision to close stores was difficult but necessary to improve (Linens ‘n Things) financial position and place the company on a firmer financial footing as we move forward,” DiNicola said. “We will be able to realize important cost savings and operational efficiencies as a result of this process.”

For 2007, the company reported a loss of $242.1 million, compared with a loss of $154 million a year earlier, according to the company’s annual report filed with the Securities and Exchange Commission.

Sales declined less than 1 percent in 2007, to about $2.8 billion. More telling, however, same-store sales, a key measure of a retailer’s health, declined 3.4 percent in ’07.

The company secured $700 million in financing to fuel operations as it reorganizes. It also hired a restructuring expert, Michael F. Gries, as chief restructuring officer and interim CEO.