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Stores Still Closed After Katrina

12 Sep, 2005 By: Holly J. Wagner

Eight Movie Gallery and 13 Hollywood Video stores remain closed because of Hurricane Katrina damage and power outages, the company announced.

Movie Gallery operates 328 stores in Alabama, Louisiana and Mississippi under both the Movie Gallery and Hollywood Video brand names.

In many cases company executives have not yet been allowed back into the facilities in restricted areas; in the areas surrounding communities impacted by the storm, Movie Gallery has several stores with limited operating hours due to power outages, floods and 'dusk-to-dawn' curfews.

Management has not yet been able to fully assess the storm's impact on operations, but the affected stores represent less than 1 percent of the combined chain's 4,800 stores across North America.

"We want to extend our sympathy to the people and communities affected by Hurricane Katrina. Our thoughts are with our customers, associates, and partners during this difficult time and we hope for a quick recovery from this disaster," said chairman and CEO Joe Malugen. "The safety of our employees is paramount. We will move as quickly as possible to assess the storm's damage and determine which stores we can reopen. We are eager to get back to serving our customers."

Executives are unable to offer guidance on the potential impact the hurricane may have on operating results in the second half of fiscal 2005, but management does not currently believe the storm will affect the chain's long-term financial condition.

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