Massive Mall Retailer Is Now At High Risk of Bankruptcy

February 19, 2024

A massive mall retailer is now at high risk of bankruptcy as the company has struggled to pay its bills recently amid slumping sales.

Express, which was founded in 1980, operates approximately 530 Express retail and Express Factory Outlet stores in the United States and Puerto Rico, the Express.com online store, and the Express mobile app.

Creditsafe’s Brand Head Ragini Bhalla shared some data on the company’s financial situation with TheStreet in an email.

“Late payments have increased drastically since June: Mounting debt, cash flow problems, and rumors of bankruptcy are currently swirling around Express Inc.

These concerns appear to be valid as Creditsafe data shows that the number of on-time payments made by Express Inc. plummeted from 91.8% in May to 65.99% in June,” she shared.

This is a trend in the retail industry happening nationwide.

“If this was an anomaly and improved after that month, it wouldn’t be so worrisome. But that doesn’t seem to be the case.

Our data shows that the retailer had a high number of late payments (1-30 days) in the second half of 2023 — with 29.12% in June, 26.82% in July, 33.61% in August, 37.58% in September, 35.67% in October,27.5% in November, 28.21% in December, and then 27.7% in January 2024,” she added.

Bhalla also expressed concerns over Express’s late payments (61-90 days) climbing from .1% in November to 15.2% in December.

“That’s a massive jump in a single month and signals severe pressure on the company’s cash flow,” she added.

The company’s DBT, or Days Beyond Term, was very low (1) in March 2023.

However, it then steadily increased for the next six months until it reached 11 in August.

And although its DBT dropped to between 6 and 8 from September to November, it spiked back up to 13 in December.

“While its DBT isn’t necessarily that high, it’s more worrying that it hasn’t been stable and has spiked in short periods of time.

This signals instability in the company’s finances, which is probably being amplified by the pressures of its mounting debt and revenue declines,” Bhalla shared.

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Also Read: This Massive Mall Retailer Is Now Closing In California

Other Economy News Today

Another popular restaurant now declares an unexpected bankruptcy after closing several chains in Chicago, Arizona, and California.

Etta Collective, a small chain that operates multiple concepts in Chicago, Arizona and Los Angeles has closed several restaurants and has filed for Chapter 11 bankruptcy, reports TheStreet.

The chain closed its namesake restaurant in Los Angeles last year and abruptly shut down a Chicago-area restaurant, Sophie’s, earlier this year.

Now, after defaulting on a $2.5 million loan, the company’s owner, restaurateur David Pisor, has officially made the bankruptcy filing.

Pisor’s Etta collective runs a number of different concepts including its namesake restaurants, a bakery cafe, Alston House, a high-end steakhouse, and Kari, an upscale sushi concept.

The chain also has Marilyn’s, a planned concept that has not opened.

Pisor has said that the bankruptcy filing was made in order to help the company continue to operate.

“We have made a proactive decision to commence this strategic reorganization process with the cooperation of our lender, who has agreed to work with us so that we can come out of this process even stronger than before,” Restaurant Business reported.

The bankruptcy process could include a sale of the brand as the investor John Leahy has emerged as a bidder for the company’s assets.

“Our aim is to best position the Etta brand for future success,” Pisor said in a statement.

“By filing for protection under Chapter 11, we will be able to restructure our financial position while continuing our daily operations and keeping our locations open.

As has already happened in our Scottsdale location, we predict that we will emerge stronger both operationally and financially.”

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Also Read: A US Company Now Declares An Unexpected Bankruptcy

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