--Photography company that served Sears, Wal-Mart abruptly
closes
--CPI Corp. had been experiencing financial troubles
--CPI had provided photo services for Sears' customers since
1959
(Adds comments from Sears and Wal-Mart spokespeople starting in
fourth graph.)
By Karen Talley
The photographer that ran the portrait studios at Sears Holdings
Corp. (SHLD), Wal-Mart Stores Inc. (WMT) and Babies "R" Us has
abruptly shuttered its business, ending a long-time retail
tradition--at least for now--at those stores.
CPI Corp., in a statement on its website, said it has closed all
of its U.S. studios "after many years of providing family portrait
photography." The St. Louis-based company didn't explain the hasty
closure, and calls to CPI went unanswered. However, the company has
struggled financially, hurt by the rise of digital photography.
The news came suddenly to the retailers. "We were notified
Thursday that CPI is ceasing its U.S. operations at retailers
across the country immediately," Sears spokesman Howard Riefs said.
CPI has provided photo services for Sears' customers since 1959 and
has been the store's only portrait studio operator since 1986,
currently located in all 788 Sears stores in the U.S. and Puerto
Rico.
Sears "is exploring all options" to potentially again provide
portrait services as soon as possible, Mr. Riefs said.
CPI operated in less than 20% of Wal-Mart stores in the U.S.,
said Wal-Mart spokeswoman Danit Marquardt. Ms. Marquardt said
Wal-Mart did not have details about how the space would be used
going forward.
CPI's financials have been deteriorating. Through the first
three quarters of its recently completed fiscal year, the company's
loss quintupled to more than $60 million, while sales fell 24% to
$192.7 million. Meanwhile, CPI's total liabilities rose 14% to
$174.8 million, and its total assets dropped 41% to $56.2 million.
These are the latest numbers publicly available from the
company.
Last month, CPI entered into its fourth forbearance agreement
with its creditors, to whom the company owed $98.5 million. The
agreement gave the company until April 6 to repay creditors.
Department stores have long offered portrait services at their
stores. The studios are a place where family milestones can be
captured, like a youngster's birthday or a holiday picture. The
studios also would bring in customers that could fan out and shop
in other parts of the store.
Spokespeople from the retailers said they are making sure
customers get their photos, with Wal-Mart providing them at its
customer service counters and Sears saying it is working with
CPI.
CPI said in its online statement, "We are attempting to fulfill
as many customer orders as possible."
Write to Karen Talley at karen.talley@dowjones.com;
Subscribe to WSJ: http://online.wsj.com?mod=djnwires