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DeborahWeinswig,ManagingDirector,FungGlobalRetail&Technologydeborahweinswig@fung1937.comUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.

June2,2017

FungGlobalRetail&TechnologytracksstoreopeningsandclosuresforaselectgroupofUSretailers.

1) Thisweek,RadioShackclosedanother1,000stores,withalargeMemorialDaysaleofeverythinginthestore,includingthestorefixtures.

2) Paylesswillgothroughasecondroundofstoreclosures:112initially,withthepossibilityof296morestoresshutteredifnegotiationswithlandlordsfail.

3) MichaelKorsandlululemonathleticaalsoannouncedstoreclosures:theaffordableluxurybrandwillclosebetween100and125stores,whilelululemonisrefocusingitsivivvabrandonlineinamovethatwillsee40ivivvadoorsclose.

4) Year-to-date2017,thenumberofstoreclosureannouncementshasincreased282%yearoveryear,bringingthenumberofstorestobeclosedto4,723,withmoretosurelyfollow.

5) DollarGeneralreviseditsforecasttoopen1,290storesinFY17,insteadofthepreviouslyexpected1,000,andFiveBelowopened31storesthispastquarter,andisontracktoreach100openingsforFY17.

Weekly Store Openings and Closures

Tracker #9: RadioShack and Payless

lead closings spree

Deborah Weinswig

Managing Director,

Fung Global Retail & Technology

deborahweinswig@fung1937.com

US: 917.655.6790

HK: 852.6119.1779

CN: 86.186.1420.3016

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DeborahWeinswig,ManagingDirector,FungGlobalRetail&Technologydeborahweinswig@fung1937.comUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.

June2,2017

2017StoreOpeningsandClosuresWhatishappeningthisweek?Thisweek’sstoreclosureannouncementsadded1,252storestoourclosingslist,withthenumberlikelytoincreaseto1,573ifMichaelKorsandPaylessgoaheadandclose125(insteadofonly100)and408(insteadofonly112)stores,respectively.Weexpectthetrendofstoreclosurestocontinueinfullforceoverthenextsixmonths,astheretailrevolutioninUSretailshowsnosignsofabating.Againstthisbackdrop,discountkeepsprovingitisawinningproposition,withbothFiveBelowandDollarGeneralcontinuingtoexpandtheirretaillocations.

RadioShackCloses1,000StoresThisweek,RadioShackclosedanother1,000stores,withalargeMemorialDaysaleofallinventory,includingthestorefixtures.UndergoingrestructuringthroughChapter11,theretailerwillcontinuetooperate70stores,whileRadioShackfranchiseeswillcontinuetorun425stores.PaylessonitsWaytoClose800StoresAfterannouncingthatitwillcloseabout400storesaspartofarestructuringplaninApril,thebankruptretailerisseekingcourtpermissiontocloseanadditional112storesintheUSandPuertoRico.Paylessisnegotiatingthetermsofanadditional296stores,andifthesenegotiationsareunsuccessful,thestoreswillbeclosedaswell.MichaelKorsAnnouncesitWillClose100–125storesMichaelKorsreportedearningsthispastweek,withcompsdecliningby14.1%,13.6%onaconstantcurrencybasis.Asaresultofthechallengesitfaces,thecompanyannouncedplanstoimprovetheprofitabilityofitsstorefleetbyclosing100–125full-priceretailstoresoverthenexttwoyears,whichshouldrealizeongoingannualcostsavingsof$60million.

LululemonAthleticaTakesivivvaOnline,Closing40RetailLocationsLululemonathleticaannouncedplans“tooperateivivva,itsactivewearbrandforgirls,asaprimarilye-commercefocusedbusiness,withaselectnumberofstoresinkeycommunitiesacrossNorthAmerica.”Thecompanywillcloseapproximately40ofits55ivivvastoresasaresult,andconvertapproximatelyhalfoftheremainingstorestolululemon-brandedstores.

DollarGeneralandFiveBelowExpandRetailFootprintDollarGeneralandFiveBelowannouncedearningsthispastweek,bothbeatingsalesandEPSexpectations.DollarGeneralreviseditsforecasttoopen1,290storesinFY17,insteadofthepreviouslyexpected1,000.FiveBelowopened31storesthispastquarter,andisontracktoreach100openingsforFY17.

Source:Twitter

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DeborahWeinswig,ManagingDirector,FungGlobalRetail&Technologydeborahweinswig@fung1937.comUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.

June2,2017

Year-to-Date 2017 Major US Store Closure Announcements

*ReportedbytheWallStreetJournalonMay4,2017,withnoofficialcomment.**Closing115Kmartand45Searsstores.***Partof100-storeclosureannouncementmadein2016.****Thenumberofstoreclosurescouldreach80basedontherecentmanagementannouncement.*****Closingremainingstoresincludedinthe50-storeclosureplanannouncedinJune2016.******Paylesswillcloseanadditional296storesifnegotiationswithlandlordsareunsuccessful.Source:Companyreports/FungGlobalRetail&Technology

2332364044506068687070

100101110120138160160171180190

220250

350400

5121,000

0 200 400 600 800 1000 1200

RalphLauren*****GanderMountain****

EasternOujikerslululemonathlelca

LucyAclvewearChico’sGuess

MCSportsMacy’s***

CVSStaples

MichaelKorsGordmansStoresInc.

AmericanApparelBCBG

JCPenneySearsandKmart**

CrocsInc.WetSeal

BebeStoresIncGameStophhgregg

TheLimitedGymboree*

Rue21PaylessInc******

RadioShack

Total: 4,723 announced store closures

282% year over year

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DeborahWeinswig,ManagingDirector,FungGlobalRetail&Technologydeborahweinswig@fung1937.comUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.

June2,2017

Year-to-Date 2017 Major US Store Opening Announcements

*Bytheendof2018.**Netstoreopenings.***Includesnew,expandedandrelocatedstores.****43Dick’sSportingGoodsstoresand9GolfGalaxystores.*****Allnewopeningsaresmall-formatstores.******Adjustedtocalendaryearfromfiscalyearreporting.*******Willbeopenedwithinexistingfull-lineMacy'sstores.Source:Companyreports/FungGlobalRetail&Technology

10

17

19

20

24

30

52

59

60

60

70

90

100

100

100

111

400

650

1,290

0 200 400 600 800 1,000 1,200 1,400

Forever21(RileyRose)

Nordstrom

Macy'sBackstage*******

Bonobos

Costco******

Target*****

Dick’sSporlngGoods,Inc.****

Walmart***

HobbyLobby

H&M*

Sephora

RossStores

Lidl

Ulta

FiveBelow

TJX**

Aldi*

DollarTree

DollarGeneral

Total: 3,262 announced store openings

53% year over year

Macy’sstores.

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DeborahWeinswig,ManagingDirector,FungGlobalRetail&Technologydeborahweinswig@fung1937.comUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.

June2,2017

2016StoreOpeningsandClosures

2016 Major US Store Closures

*Closing206Kmartand37Searsstores.Source:Companyreports/FungGlobalRetail&Technology

2016 Major US Store Openings

*NetstorenumberbetweenDecember2015andMarch2017.Includes55newstoresinJCPenneyand17standaloneSephorastores.**Adjustedfromfiscalyearfigures.***NetnumberofstoresinNorthAmerica.Source:Companyreports/FungGlobalRetail&Technology

9

18

18

26

34

34

48

71

123

154

200

233

243

463

0 50 100 150 200 250 300 350 400 450 500

JCPenney

FinishLine

Kohl’s

AmericanEagle

TheChildren’sPlace

Chico’sFAS

Staples

Gap

OfficeDepot

Walmart

Walgreens

Men’sWarehouse/JosA.Bank

SearsandKmart*

SportsAuthority

10

15

19

19

45

53

72

79

93

104

146

584

900

0 100 200 300 400 500 600 700 800 900 1,000

Zara

Target

UnderArmour***

Costco**

Aldi

H&M

Sephora*

Dick’sSporlngGoods

RossStores

Ulta

TJX

DollarTree

DollarGeneral

Total: 1,674 announced store closures

Total: 2,139 announced store openings

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DeborahWeinswig,ManagingDirector,FungGlobalRetail&Technologydeborahweinswig@fung1937.comUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.

June2,2017

DeborahWeinswig,CPAManagingDirectorFungGlobalRetail&TechnologyNewYork:917.655.6790HongKong:852.6119.1779China:86.186.1420.3016deborahweinswig@fung1937.comKirilPopovSeniorAnalyst

EsmePauAnalyst

MatthewLeeResearchAssistantHongKong:8thFloor,LiFungTower888CheungShaWanRoad,KowloonHongKongTel:85223004406London:242-246MaryleboneRoadLondon,NW16JQUnitedKingdomTel:44(0)2076168988NewYork:1359Broadway,9thFloorNewYork,NY10018Tel:6468397017FungGlobalRetailTech.com