EXHIBIT 99.1
[WHITEHALL LOGO] NEWS RELEASE
WHITEHALL JEWELLERS, INC.
================================================================================
For: Whitehall Jewellers, Inc.
Contact: John R. Desjardins
Executive Vice President,
Chief Financial Officer
TX: 312-762-9751
IMMEDIATE RELEASE
- ------------------
WHITEHALL JEWELLERS ANNOUNCES RECEIPT OF RESIGNATION LETTER
FROM BERYL RAFF AND DISCUSSES FINANCING ISSUES AND DELAY IN
REPORTING SECOND QUARTER RESULTS
Chicago, Illinois, September 8, 2005 - - Whitehall Jewellers, Inc. (NYSE:
JWL) (the "Company") announced that it received a letter yesterday from Beryl
Raff advising that she has resigned all positions with the Company. Ms. Raff had
previously been named as Chief Executive Officer and was expected to commence
full-time employment with the Company and join its board of directors in
mid-September. She also indicated in the letter that she will be returning
compensation previously paid to her by the Company. The Company is currently
assessing its legal and other alternatives in light of Ms. Raff's letter.
Whitehall also announced that it is reviewing its financial situation in
light of current and forecasted operating results and management changes. The
Company believes it needs additional capital to support its operations. The
Company is evaluating various alternatives to meet these needs, including the
raising of additional debt or equity financing. The Company has requested
temporary extensions of payment terms from some of its key suppliers in order to
manage liquidity and has also slowed its accounts payable schedules generally.
In addition, the Company plans to retain restructuring professionals to assist
it.
The Company is actively engaged in discussing alternatives with its bank
lenders and other parties. There is no assurance that the discussions will
result in additional financing or that an alternative transaction will be
available. If the Company is not able to procure additional financing or
otherwise able to obtain additional liquidity, it may be forced to pursue other
alternatives, such as a restructuring of its obligations.
The Company also announced that it does not expect to be in a position to
file its Quarterly Report on Form 10-Q, including financial results for its
second fiscal quarter, on a timely basis. The Company expects to report a net
loss for its second fiscal quarter.
Whitehall Jewellers, Inc. is a national specialty retailer of fine
jewelry, operating 388 stores in 38 states. The Company operates stores in
regional and super regional shopping malls under the names Whitehall Co.
Jewellers, Lundstrom Jewelers and Marks Bros. Jewelers.
For Investor Relations info: investorrelations@whji.com
Internet Website: www.whitehalljewellers.com
Safe Harbor Statement
This release contains forward-looking statements (as such term is defined
in Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934) and information relating to the Company that are based on
the current beliefs of our management as well as assumptions made by and
information currently available to management including statements related to
the markets for our products, general trends and trends in our operations or
financial results, plans, expectations, estimates and beliefs. In addition, when
used in this report, the words "anticipate," "believe," "estimate," "expect,"
"intend," "plan," "predict," "opinion" and similar expressions and their
variants, as they relate to us or our management, may identify forward-looking
statements. Such statements reflect our judgment as of the date of this press
release with respect to future events, the outcome of which is subject to
certain risks, including the factors described above and below, which may have a
significant impact on our business, operating results or financial condition.
Investors are cautioned that these forward-looking statements are inherently
uncertain. Should one or more of these risks or uncertainties materialize, or
should underlying assumptions prove incorrect, actual results or outcomes may
vary materially from those described herein. The Company undertakes no
obligation to update forward-looking statements.
The following factors, among others, may impact forward-looking statements
contained in this release: (1) our ability to execute our business strategy and
our continued net losses and declines in comparable store sales; (2) our ability
to manage our liquidity and to obtain adequate financing on acceptable terms and
the effect on us if an event of default were to occur pursuant to our revolving
credit facility; (3) a change in economic conditions or the financial markets
which negatively impacts the retail sales environment and reduces discretionary
spending on goods such as jewelry; (4) reduced levels of mall traffic caused by
economic or other factors; (5) increased competition from specialty jewelry
retail stores, the Internet and mass merchant discount stores which may
adversely impact our sales and gross margin; (6) the high degree of fourth
quarter seasonality of our business and the impact on our sales, profitability
and liquidity; (7) the extent and success of our merchandising, marketing and/or
promotional programs; (8) personnel costs, the extent to which we are able to
retain and attract key personnel and disruptions caused by the loss of key
personnel; (9) the availability, terms and cost of consumer credit; (10)
relationships with suppliers including the timely delivery to us of appropriate
merchandise on acceptable payment terms; (11) our ability to maintain adequate
information systems, capacity and infrastructure; (12) our leverage and cost of
funds and changes in interest rates that may increase financing costs; (13) our
ability to maintain adequate loss prevention measures; (14) fluctuations in raw
material prices, including diamond, gem and gold prices; (15) the impact of
current or future price reductions on margins and resultant valuation allowances
taken on certain merchandise inventory identified from time to time as items
which would not be part of our future merchandise presentation as well as
alternative methods of disposition of this merchandise inventory and resulting
valuations taken; (16) developments relating to settlement of the consolidated
Capital Factors actions, the non-prosecution agreement entered into with the
United States Attorney's Office, the SEC investigation and shareholder and other
civil litigation, including the impact of such developments on our results of
operations and financial condition and relationship with our lenders or with our
vendors; (17) regulation affecting the industry generally, including regulation
of marketing practices; and (18) the risk factors identified from time to time
in our filings with the SEC.
###
For Investor Relations info: investorrelations@whji.com
Internet Website: www.whitehalljewellers.com