At last check, Urban Outfitters shares traded at $14.81, up 1.7%.
“Since March 14 when we closed our stores to the public, Urban Outfitters has provided ongoing pay and benefits to all store and home office employees impacted by the temporary closures,” the diversified retailer, which owns Anthropologie, said in a statement.
“Even though our digital business continues to operate, the store closures and lower overall demand require a smaller workforce to support the business.”
So it’s furloughing “a substantial number of store, wholesale and home office employees for 60 days beginning tomorrow, April 1. Impacted employees will continue to receive enrolled benefits during the furlough period.”
Compensation for senior management will be reduced during the time that workers are furloughed. Directors will receive no cash compensation for the rest of fiscal 2021.
And stock buybacks are out “for the foreseeable future,” the company said.
Urban Outfitters is suspending hiring, eliminating bonuses for fiscal 2021 (which began Feb. 1) and delaying merit raises.
The company is also temporarily suspending rent payments and delaying or canceling some planned new store openings.
In addition, it’s extending payment terms for its vendors. Urban Outfitters is cutting its capital budget by more than $100 million by delaying or canceling projects.
It’s borrowing $220 million to make sure it has sufficient cash.
“We understand the measures are extreme, but they are unavoidable,” Chief Executive Richard Hayne said in the company’s statement.
On Monday, Macy's (M) - Get Report said it would furlough most of its employees beginning this week as the store closings forced by coronavirus take a toll on the Cincinnati retailer.
And on Tuesday Simon Property Group, (SPG) - Get Report the largest U.S. mall operator, said it would furlough 30% of its workforce to cut costs as the coronavirus has crippled major sectors of the world economy, CNBC reported.