Joann Fabrics to lay off workers at Hudson headquarters

Hudson-based Joann Inc. is laying off some workers at its company headquarters, Crain's Cleveland Business reports a company spokesperson has confirmed.

Joann spokesperson Amanda Hayes, who did not respond immediately to a Beacon Journal voice message or email, said in an email to Crain's that some positions are being eliminated in various departments to align the company's "expense and corporate structure to the needs of our business."

The number of layoffs is not publicly known. The fabrics and crafts retailer has about 850 stores in 49 states.

A Worker Adjustment and Restraining Notification (WARN notice) required for mass layoffs had not been posted on the state's website as of late Thursday afternoon.

City of Hudson reacts

Ward 2 Hudson City Council President Chris Foster said the situation is unfortunate.

"You have different people debating whether the economy is good or whether the economy is not good," he said, "but the reality around us is that a lot of companies are downsizing and/or going out of business like Diebold going in and out of bankruptcy — and JoAnn Fabrics certainly has seen a substantial decline in revenues and profitability."

Hudson will feel the effects of these layoffs, Foster said, but the scope of the impact won't come into focus until the number of jobs lost is announced.

Company sees increased losses in 2022, 2023

Prior to going public in 2021, Joann was privately owned for 10 years by affiliates of Los Angeles-based private equity investment firm Leonard Green & Partners.

Joann reported $2.2 billion in revenue at the end of 2022, down 8.3% from $2.4 billion the previous year.

But the company reported a $200.6 million net loss for the last fiscal year, which ended in January. In the prior fiscal year, the company reported net income of $56.7 million, crediting a surge of COVID-19-induced sales in 2021 as people engaged in crafts at home, as well as the manufacture of face masks.

This year's losses are on track to exceed last year's, after the company announced net losses of of $127.5 million during the first two quarters of 2023, versus $92 million during the same period last year.

More: Joann president and CEO Wade Miquelon retires, Hudson-based company announces

Former CEO Wade Miquelon, who had been with the company six years, retired in May. Chris DiTullio, executive vice president and chief customer officer, and Scott Sekella, executive vice president and chief financial officer, have been appointed to lead as interim CEOs.

Joann plans $200 million annual reduction in costs

In an earnings call last December, Miquelon announced a $200 million annual cost reduction plan, about half of which would come from cuts in ocean freight costs, 30% from the cost of goods and the remainder in overhead. He said the reductions would be fully realized by early 2024.

The corporate layoffs come as the company announced it is hiring 5,000 part-time workers for the holiday season. Prospective employees were invited to apply at stores nationwide Sept. 1 and 2.

Derek Kreider contributed to this report. Eric Marotta can be reached at emarotta@gannett.com.

This article originally appeared on Akron Beacon Journal: Hudson-based Joann Fabrics to lay off workers at headquarters