January 29, 2009

Home Depot to close Expo Design stores

Home Depot is among the corporations announcing store closures and layoffs, one of which will affect the Expo Design Store on Almaden Expressway.

Over the next two months, the company will cut 7,000 jobs and close all 34 of its Expo stores as well as two YardBIRDS stores, two Design Center stores and seven HD Bath stores, which remodeled bathrooms. The closings will affect about 5,000 store employees, as well as those in support departments and distribution centers.
According to the company, the Expo high-end design and décor business wasn’t strong during the housing boom. It has dropped significantly in the current economic climate.

The company plans to cut jobs in administrative functions in its store support centers but not customer-facing positions in Home Depot stores. That will result in another 2,000 job cuts and a 10 percent reduction in the company’s officer ranks. The company is freezing officers’ salaries, but will continue to offer merit increases to non-officers.

Home Depot is projecting its pre-tax charges — primarily from fixed asset write-offs, lease reserves, severance and store closing costs — of $532 million, of which about $390 million will be taken in the fourth quarter and $142 million in 2009 and beyond.

It expects the cuts to boost fiscal 2009 earnings before interest and tax by $305 million, primarily from payroll savings and operational improvements from the business exit.