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had struggled with its debt a crisis that worsened as revenue part of an overall trend affecting most retailers during the The company has lost nearly a half billion dollars in the pastthre years. Those losses, coupled with the impact of the recessionm and debt payments apparently pushecd the company into bankruptcy court a move that was rumorexfor months. Eddie Bauer becamse the latest major retailer to succumg to filing in bankruptcy court this The list also includesLinens ‘n Circuit City and Northwest retailedr , which sold its assets to a liquidatoer in April and closed 31 In many ways, Eddie Bauer’s crisis is not different from what most retailers are facing during this prolonged and deep said Greg Charleston, an Atlanta-baseed consultant for Conway MacKenzie who work with financially stressed retailers looking to Most retailers — except discount stores like Wal-Mart ha ve seen a fast drop-off in retail revenus across the board, Charleston said.
Many of the specialtyu retail department stores haveseen double-digit same-store salea declines, he said. “When revenue dropss and same-store sales drop, companies with less debt can weather a downturnnmuch longer,” Charleston said. “It becomes an issud much sooner if you are intoliquiditty issues.” As of May 11, Eddie Baued reported having $289.5 million in outstandinb debt, including $187.8 million in term loansz and $75 million in convertiblde notes, which company executives have been trying to persuade debt-holders to convert into shares of the According to a filing with the , Eddid Bauer had total assets of $525.22 million in April.
The company lister total liabilitiesof $448.9 Eddie Bauer reported net losses of $165.5 milliomn in fiscal year 2008, part of a totalk of $478.7 million in losses duriny the past three fiscal In the first quarter that ended in April, the compan y reported net losses of 44.5 million. For the firstt quarter of fiscalyear 2009, whichj ended April 4, Eddie Bauer reportedx a loss of $44.5 million. That was a greatefr loss than the first quarterof 2008, when the compang reported a $19.3 million loss. Net sales for the firsr quarter of 2009were $179.8 million, compared with net salez of $213.2 million in the firsty quarter of 2008.
The company said that combinex comparable storesales — a barometer of succes at the store levelo — fell 11.3 percent for the first quarter, a declinse the company blamed on the recession and reducedr retail spending. Sales were down nearlyt 15 percent inEddies Bauer’s retail stores and sales througj its direct channel were down nearly 11 percent. The outletg stores saw sales decline by nearly76 “The first quarter was a difficultf one, as the sharp downturn in the economg took its toll on our sales.
We continuedf to focus on cost cutting and cash flow which helped mitigate the impact oflower sales,” said CEO Neil in a statement with the first-quarter results filesd with the SEC. Eddie Bauer has 370 stores, includingv 251 retail stores and 119 outlet stores in the United Statedsand Canada. Eddie Bauer has 17 stores in Washingtonh and 11 storesin Oregon. (See a copy of the bankruptcyg filing .) But by filing for reorganization undert Chapter 11 of the federal bankruptcy Eddie Bauer hopes to avoic the fateof Joe’s Sports & Outdoor, whicbh filed for bankruptcy protect March 4. The Ore.
-based company had hoped to find a ButIn April, a bankruptct judge approved the liquidation of the Joe’s store after the company could not find a Joe’s had 31 Northwest stores — 10 of them in King and Pierce countiex — that held going-out-of-businesx sales after the company’s assets were snapped up at bargain basement prices by , a liquidator that also sold off merchandises for Circuit City.
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