Circuit City plans to close dozens of stores

Circuit City Stores Inc. said Thursday that it planned to close seven domestic Superstores, a Kentucky distribution center and 62 stores in Canada to cut costs and improve its financial performance.

The closings will take place over the next six months at an expected cost of $85 million to $105 million, Circuit City said.

Chief Executive Philip J. Schoonover said the company accelerated the cuts “because of the intensified gross margin pressures that we saw in the third quarter within the flat-panel television category.”

Richmond, Va.-based Circuit City operates through 643 Superstores and 12 other locations in 158 U.S. markets and more than 800 retail stores and dealer outlets in Canada.

The company also said it would shut down its Rapid Satellite business, which was being offered for sale. Circuit City purchased the small satellite television retailer in 2005.