A luxury retailer now files for an unexpected bankruptcy after its debt liabilities ballooned, several sources report.
Anne Fontaine USA, the U.S. affiliate of the Paris-based luxury boutique chain, on Jan. 16 filed for Chapter 11 Subchapter V bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York.
The luxury brand asserted that the company has not been able to recover from financial distress caused by the Covid-19 pandemic, Law360 reported originally reports.
The New York-based affiliate in its Chapter 11 petition listed about $11.4 million in assets and $6.44 million in liabilities, which were mostly unsecured debts owed to landlords for rent.
Its largest unsecured creditors included landlords Geary-Market Investment Co., owed $620,000; RB ATLT LLC, owed $410,000; and SL Green Realty, owed $239,025, reports TheStreet.
Anne Fontaine operates 17 luxury boutique locations in the U.S., but globally, the parent company also has 19 in Europe, three in the Middle East and three in Asia, according to its website.
The retailer also has an e-commerce presence on its website, offering its ‘Parisian-inspired’ luxury fashion apparel, shoes, handbags and other accessories.
The Covid-19 pandemic significantly reduced the affiliate’s gross revenue in 2020, as it reported $9.1 million in gross revenue that year compared to $18.1 million in 2021 and $20.3 million in 2022, according to the company’s petition.
The company did not list revenue figures from 2019 or 2023.
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Also Read: A US Company Now Declares An Unexpected Bankruptcy
Other Economy News Today
A massive mall retailer is now laying off 2,350 people, or 3.5% of its workforce across the entire United States, sources report.
Macy’s has announced that it will reduce 3.5% of its workforce and has plans to shut down a total of five of its full-line stores.
In a statement sent via email, a spokesperson for Macy’s said, “In anticipation of implementing a new strategy to adapt to the evolving needs of consumers and the market, we have made the tough choice to streamline our company by reducing our workforce by 3.5%.”
Reports indicate that approximately 2,350 corporate positions will be cut by as early as this month.
Supply chain automation, some outsourcing, and faster decision-making were reportedly among the reasons for the cuts.
The Wall Street Journal first reported the news.
Retailers often lay off employees and announce store closures after the holidays, especially if they had a sluggish sales season.
However, Americans spent at a faster clip in December from the month prior, the Commerce Department said this week.
The company opened its first Macy’s in 1858 and now operates about 500 Macy’s branded stores, as well as 55 of the more upscale Bloomingdale’s chain.
In addition to the closures of anchors of five malls in California, Florida, Hawaii, and Virginia, Macy’s will sell and relocate two furniture stores.
A group of investors in December reportedly proposed to take Macy’s private at a vulnerable moment for the famed company. Macy’s has not commented on the activist attempt.
Macy’s has attempted numerous strategies in recent years to revitalize business, such as new brands and smaller stores, but the moves have not altered its long-term trajectory.
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Also Read: This Massive Clothing Company Is Now Closing Stores
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Great article.
Not surprised. Their clothing is way overpriced.
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