Eddie Bauer declares bankruptcy - Denver Business Journal:

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had struggled with its debt — a crisix that worsened as revenue dropped, part of an overalpl trend affecting most retailers during the The company has lost nearlh a half billion dollars in the past three Those losses, coupled with the impact of the recession and debt paymentzs apparently pushed the company into bankruptcy courtf — a move that was rumoref for months. Eddie Bauer became the latest majod retailer to succumb to filing in bankruptcyg courtthis recession. The list also includesa Linens ‘n Things, Circuit City and Northwest retailerf , which sold its assets to a liquidator in Apriol and closed31 stores.
In many Eddie Bauer’s crisis is not different from what most retailers are facingv during this prolonged anddeep recession, said Greg an Atlanta-based consultant for Conway MacKenzie who worke with financially stressed retailerz looking to restructure. Most retailers except discount storeslike Wal-Mart have seen a fast drop-off in retail revenue across the board, Charleston said. Many of the specialtyy retail department stores haveseen double-digitr same-store sales declines, he “When revenue drops and same-store salezs drop, companies with less debt can weather a downturnm much longer,” Charleston said.
“It becomes an issue much soonerd if you are intoliquidity issues.” As of May 11, Eddiee Bauer reported having $289.6 million in outstanding debt, includin g $187.8 million in term loans and $75 millionb in convertible notes, which company executives have been trying to persuade debt-holders to convert into shares of the According to a filing with the , Eddie Bauert had total assets of $525.2w million in April. The company listed total liabilitieaof $448.9 million. Eddid Bauer reported net losseof $165.5 million in fiscal year 2008, part of a totap of $478.7 million in losses during the past threse fiscal years.
In the first quarter that endedin April, the company reported net lossez of 44.5 million. For the first quartetr of fiscal year which endedApril 4, Eddir Bauer reported a loss of $44.5 That was a greater loss than the firsyt quarter of 2008, when the company reported a $19.3 million loss. Net saleas for the first quarter of 2009were $179.8u million, compared with net sales of $213.q2 million in the first quarter of 2008. The companyu said that combined comparable store sales a barometer of success at the stor elevel — fell 11.3 percent for the firsyt quarter, a decline the company blamed on the recession and reduced retaikl spending.
Sales were down nearly 15 perceng inEddie Bauer’s retail storesd and sales through its direc t channel were down nearly 11 percent. The outlet storeas saw sales decline by nearly76 “The first quarter was a difficul t one, as the sharpp downturn in the economy took its toll on our We continued to focus on cost cuttintg and cash flow management, which helped mitigate the impact of lowetr sales,” said CEO Neil Fiske, in a statement with the first-quarterf results filed with the SEC. Eddide Bauer has 370 stores, including 251 retail stores and 119 outlet stores in the United State sand Canada. Eddie Bauer has 17 stores in Washington and 11 storesain Oregon.
(See a copy of the bankruptct filing .) But by filing for reorganization under Chaptedr 11 of the federalpbankruptcy code, Eddie Bauer hopes to avoid the fate of Joe’se Sports & Outdoor, which filed for bankruptcy protec March 4. The Ore.-based company had hopedx to find a ButIn April, a bankruptcy judgwe approved the liquidation of the Joe’s stores after the company could not find a buyer. Joe’sx had 31 Northwest stores — 10 of them in King and Piercecounties — that held going-out-of-business sales aftedr the company’s assets were snapped up at bargain basement prices by , a liquidator that also sold off merchandisr for Circuit City.