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Zales and Citibank Forgive, Forget and Move On

Zales was a good example of a tumbling company during the last few years. Small signs and managerial changes show it may be holding it’s own and won’t be “pawned” any day soon:

Zale Corporation has signed a new agreement with Citibank to provide the private label credit card program at Zales, Zales Outlet and Gordon’s brands in the U.S.

The five-year deal, which goes into effect on October 1, 2010, replaces the jewelry retailer’s current agreement with Citibank which was scheduled to expire in March 2011. The agreement also provides an automatic renewal for two successive two-year terms.

Citibank cancelled a penalty owed by Zale for a shortfall in credit sales, and the new agreement reduced the annual minimum volume of credit card sales required by Zale from $600 million to $315 million. Citibank has also pledged to provide financial support for Zale’s marketing activities during the initial five year term of the contract.

Separately, Zale has named Theo Killion as chief executive officer (CEO) to permanently replace Neil Goldberg who stepped down from the position in January. Killion has served as interim CEO since Goldberg’s departure.

Killion joined Zale in January 2008 after serving in senior management positions at Tommy Hilfiger, Limited Brands, Macy’s East and the Home Shopping Network.