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Build-A-Bear to Shutter Friends 2B Made Stores

9/16/2008

St. Louis Build-A-Bear Workshop, Inc., announced Tuesday that it will shut down its chain of nine Friends 2B Made stores and the concept’s associated product line.

Friends 2B Made is a make-your-own-doll complement to the create-your-own-bear base concept.

Build-A-Bear Workshop said it expects to close the stores by the end of its fiscal third quarter but said the exact dates could change, dependent on the finalization of third-party agreements.

The company said the closures would cost about $2.8 million pre-tax in the third quarter, with additional pre-tax charges ranging from $1.9 million to $2.3 million in the fourth quarter and through next year's third quarter. Primarily, the charges are related to lease terminations.

According to the company, the intent is to offer jobs at nearby Build-A-Bear locations to employees of the Friends 2B Made stores that will be closed.

The nine stores are in New York City, Boston, Pittsburgh, Minneapolis and St. Louis, as well as Columbus, Ohio; Temecula, Calif.; Myrtle Beach, S.C.; and Ontario, Calif.

The announcement to close Friends 2B Made comes amid falling sales, as Build-A-Bear Workshop announced in July its fiscal 2Q results, which showed a $4.8 million loss. Revenue fell 5% to $94.7 million from $100 million last year.

Same-store sales, or sales in stores open at least one year, fell 17.9% in the second quarter, including a 20.5% drop in the United States and a 2.2% rise in Europe.

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