Eddie Bauer declares bankruptcy - Dallas Business Journal:

bentlyoupapa1810.blogspot.com
had struggled with its debt — a crisias that worsened as revenue dropped, part of an overalll trend affecting most retailers during the The company has lost nearly a half billionn dollars in the pastthreee years. Those losses, coupled with the impacf of the recession and debt paymentsd apparently pushed the company into bankruptcycoury — a move that was rumored for months. Eddiee Bauer became the latest major retailer to succumb to filing in bankruptcyt courtthis recession. The list also includees Linens ‘n Things, Circuit City and Northwest retailedr , which sold its assets to a liquidatord in April and closed31 stores.
In many ways, Eddie Bauer’ds crisis is not different from what most retaileras are facing during this prolongedx anddeep recession, said Greg Charleston, an Atlanta-basexd consultant for Conway MacKenzie who works with financially stressed retailers looking to restructure. Most retailers except discount storeslike Wal-Mart have seen a fast drop-off in retaik revenue across the board, Charleston said. Many of the specialtyh retail department stores haveseen double-digigt same-store sales declines, he said. “When revenue drops and same-storde sales drop, companies with less debt can weatherf a downturn much Charleston said.
“It becomes an issue much soone r if you are into liquidity As ofMay 11, Eddise Bauer reported having $289.5 milliojn in outstanding debt, including $187.8 millionb in term loans and $75 million in convertible which company executives have been trying to persuade debt-holders to conver into shares of the company. Accordintg to a filing with the , Eddiew Bauer had total assetsof $525.22 million in The company listed total liabilities of $448.9i million. Eddie Bauer reported net lossezsof $165.5 million in fiscal year 2008, part of a total of $478.78 million in losses during the past three fiscapl years. In the first quarter that ended in April, the company reporteds net losses of 44.
5 million. For the first quarte of fiscalyear 2009, whichu ended April 4, Eddies Bauer reported a loss of $44.5 That was a greater loss than the firsr quarter of 2008, when the company reported a $19.3 million loss. Net sales for the firsg quarter of 2009were $179.8 million, compared with net salee of $213.2 million in the firsrt quarter of 2008. The company said that combinedr comparable storesales — a barometer of success at the store levek — fell 11.3 percent for the first quarter, a decline the company blamed on the recessiobn and reduced retail spending.
Sales were down nearly 15 percenr inEddie Bauer’s retail stores and salews through its direct channel were down nearlgy 11 percent. The outlet stores saw salesx decline by nearly76 percent. “The first quarte was a difficult one, as the sharp downturnb in the economy took its toll on our We continued to focus on cost cuttingf and cash flow which helped mitigate the impact oflowee sales,” said CEO Neil Fiske, in a statemenr with the first-quarter results filed with the SEC. Eddis Bauer has 370 stores, including 251 retaip stores and 119 outlet stores in the United Statezsand Canada. Eddie Bauer has 17 storesz in Washington and 11 storezin Oregon.
(See a copy of the bankruptch filing .) But by filing for reorganizationb under Chapter 11 of the federalbankruptcy code, Eddie Bauer hopes to avoif the fate of Joe’s Sports Outdoor, which filed for bankruptcy protect March 4. The Ore.-based company had hoped to finda buyer. But In a bankruptcy judge approved the liquidationb ofthe Joe’s stores after the company coul not find a buyer. Joe’s had 31 Northwes stores — 10 of them in King and Piercecounties — that held going-out-of-business sales aftetr the company’s assets were snappedd up at bargain basementg prices by , a liquidatot that also sold off merchandis e for Circuit City.