Tim Hortons to close 36 New England stores

Nov. 11, 2010 at 9:03 AM

OAKVILLE, Ontario, Nov. 11 (UPI) -- Canadian coffee and doughnut retailer Tim Hortons said it would close 36 under-performing U.S. outlets despite rising revenues.

The retailer that operates 600 U.S. outlets said revenues in the latest quarter rose 9.8 percent with sales up 4.3 percent in its Canadian stores and 3.3 percent in the United States.

However, the firm said in a statement that it would take a $20.9 million asset impairment charge in the quarter in the New England region and close 34 stores in Providence, R.I., and Hartford, Conn., and two stores in Portland, Me.

"We are profitably growing our U.S. business in our core Northeast and Midwest U.S. markets and overall we are seeing sales develop consistent with our expectations and long-term views of success," said Horton's President and Chief Executive Officer Don Schroeder in a statement.

"The restaurants we are closing in the New England region have detracted from that performance," he said.

The firm also said it would use "approximately $400 million" out of the proceeds from sale of Maidstone Bakeries to buy back outstanding shares. The remaining $30 million from the sale would be turned over to company restaurants "to mitigate anticipated rising operating costs," due to new regulations, the company said.

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