Fred’s Inc.’s (NASDAQ: FRED) shares plummeted over 20% in afternoon trade on Thursday as the company announced that it is closing an additional 104 stores by the end of June, with liquidation sales at these stores starting today.
Last month, the company said it would close 159 stores by the end of May, leaving 398 stores open at the time. These closures, combined with today’s announcement, would bring Fred’s total store count to less than 300 stores.
The company opted for the closures after a complete evaluation of its store portfolio. After looking at factors such as store performance and the timing of lease expirations, the retailer decided to close underperforming locations.
Fred’s is also pursuing the sale of its remaining pharmacy assets as part of its plan to monetize non-core assets to generate shareholder value. Last year, the company sold the patient prescription files and inventory of 179 Fred’s stores to Walgreens Boots Alliance (NYSE: WBA).
Last week, Fred’s reported its fourth quarter 2018 results, in which net sales fell 17.2% and comparable store sales fell 9.7%. Net loss from continuing operations was $67.2 million, or $1.86 per share.
Fred’s shares have tumbled 74% so far this year.