Dont believe those rumors, Kmart headquarters says

Persistent rumors that the Havre Kmart will close in the next few months or few days just aren't true, the Kmart corporate office said today.

"Our chairman has said we need all stores as we enter the holiday season," said Susan Dennis, spokeswoman at Kmart's Troy, Mich., headquarters. "There will be no closures at this time."

Jody Neibauer, an assistant manager at the Havre store, said people in the community have been asking if the store is going to close.

"Every once in a while we've been hearing rumors," she said. "They're just rumors."

David Sohm, another of the store's assistant managers, said the store management has not received any notice the company plans to close its Havre location.

"It's just business as usual," Neibauer said.

Store manager Steve Harr was not available for comment.

The corporation filed for Chapter 11 bankruptcy protection on Jan. 22, following a reduction of its investment rating and a steep drop in its stock price.

On March 8, the corporation announced it would close 284 underperforming stores, including 271 Kmart discount stores and 12 Kmart Supercenter retail outlets in 40 states, and one Kmart store in Puerto Rico.

The only Montana store that closed was in Billings. Ten remain open, including another Billings store.

James Adamson, chairman and chief executive officer of Kmart, reported in a press release on Sept. 16 that sales for the company had improved at a slower rate after the reorganization than he would have liked.

Adamson replaced the company president, Mark S. Schwartz, on Jan. 17. Adamson replaced Chuck Conaway as CEO on March 11.

The company had a net loss of $377 million for the quarter ending July 1, or 75 cents a share, compared with a loss of $377 million for the quarter in 2001, which translated to a drop of 77 cents a share.

The company's net sales for the quarter were $7.52 billion, a loss of 15.7 percent from 2001.

The company is continuing to work with employees, vendors, lenders and other stakeholders to finish its restructuring and leave Chapter 11 protection as quickly as possible, Adamson said. The company has been pursuing opportunities, including introducing new lines and new marketing strategies, to increase store traffic and sales. Kmart has also worked to reduce costs to better match its revenues, he said.

The company announced in a press release on Aug. 19 that it was implementing a cost-reduction program expected to save $66 million in 2002 and $130 million annually. The company will try to eliminate low-priority projects, re-engineer work processes and consolidate workloads, Adamson said.

The August action eliminated about 400 positions at Kmart's corporate headquarters and about 50 positions nationwide that provide corporate support. The company also eliminated about 100 open positions throughout the chain, and began phasing out about 130 contract positions

Dennis said the company is trying to make sure its stores have the merchandise customers need for the holiday season. Once the holidays are over, the company will probably re-evaluate each store's performance, but "we don't have any plans to close any stores at this time," she said.