99 Cents Only puts Texas exit on hold
99 Cents Only Stores Inc. said Tuesday that it was putting a hold of up to six months on its plan to exit the Texas market after surprisingly strong January sales.
But the City of Commerce retailer did announce plans to close some of its Texas stores.
The discount chain announced last year that it would pull out of Texas, leaving the company with stores in California, Arizona and Nevada.
But the company released monthly financial figures Tuesday showing that same-store sales in Texas had grown 8.6% during the four-week period ended Jan. 24, and the upswing during the current recession led it to reevaluate its strategy to leave Texas altogether.
“Although management is unsure how strongly the challenging economy may affect sales trends in Texas, it does believe 99 Cents Only Stores, similar to other value-focused consumer businesses such as Wal-Mart and McDonald’s, is well positioned to benefit from the recessionary economy,” the company said.
Even so, 99 Cents Only said that its board decided to close about one-third of the Texas stores by March 28.
-- Andrea Chang