A massive mall clothing retailer now faces Chapter 11 bankruptcy as it struggles to keep its cash reserves above water.
Children’s Place, to its credit, has been working to get itself out of leases at dying malls, reports TheStreet.
“The chain has closed 250 locations over the past year driving more of its business to its website and its digital storefront on Amazon.
That’s probably the right strategy, but the retailer may run out of cash before it can fully correct its business,” the outlet reports.
Total liquidity as of Feb. 3, 2024 is expected to be approximately $45 million (including approximately $13 million of cash and cash equivalents and approximately $32 million of excess availability under the company’s credit facility after excluding all necessary reserves and excess availability requirements),” the company shared in advance of fourth quarters earnings release.
And, while the company has very little cash, it did share some good news when it comes to its overall debt load.
“As previously anticipated, total indebtedness is expected to decrease by more than $100 million versus the third quarter of fiscal 2023 and, as of February 3, 2024, is expected to be approximately $277 million as compared to $408 million as of the end of the third quarter of fiscal 2023,” Children’s Place added.
However, the company knows that it is in a dire position based on its available cash.
“The company has been working to improve its liquidity position and strengthen its balance sheet to best position the company for the future.
The company is working with its advisors (including Centerview Partners), lenders, and potential lenders to obtain new financing necessary to support ongoing operations, and is considering strategic alternatives in the event that the company is unable to consummate new financing,” it shared.
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Also Read: A Popular Essential Retailer Is Now Closing 72 Locations
Other Economy News Today
Another grocery store now makes unexpected closures after not being “able to capitalize on the area”, sources report.
A Lidl store has announced that it would soon close down – and the news has upset customers, reports The-Sun.
The message was sent out to employees on Thursday, February 8, by Lidl’s vice president, according to the Index Journal.
They explained that the closure was due to several economic factors.
These included “not meeting sales expectations” and “not being able to capitalize on the area.”
“This marks a continuing trend of shutting down stores in low-income and rural areas across the Southeast,” the message also said.
The store closure is reportedly set for the end of February so shoppers will only have around two weeks to visit that location.
Lidl is a German grocery store chain that also established itself in the US and has grown to over 173 locations, mostly on the East Coast, according to ScrapeHero.
Shoppers in Greenwood were upset by the news, according to the Index Journal.
Customer Eric Outz said he had not heard about the closure and said he would later talk to one of his family members who worked at the store.
“I think it’s a good store,” he said.
“I feel bad for them,” Eric said about the employees.
Other customers also shared their thoughts on the closure on Reddit.
“I’m actually devastated. I’ve lived in Greenwood for 5 years and go to that Lidl at least every week, usually twice a week,” one Redditor shared.
“It’s better than basically every other grocery store in town, but people just stick to what they know.”
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Also Read: A US Company Now Declares An Unexpected Bankruptcy
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