S&P: Charming Shoppes unchanged

Standard & Poor's said its ratings on Charming Shoppes Inc. (BB-/negative) remain unchanged after the company's announcement of a restructuring program designed to streamline operations and reduce expenses.

The agency said that Charming Shoppes expects to save $20 million annually on a pre-tax basis by closing 150 underperforming stores, reducing corporate and field management positions by 13%, decreasing the fiscal 2009 capital budget by $40 million, and closing its four Petite Sophisticate full-line stores.

According to S&P, the closed stores currently contribute a pre-tax loss of about $6 million annually while management expects the aforementioned initiatives to cost about $17 million, of which $7 million is non-cash expenses related to store closures.

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