Eddie Bauer declares bankruptcy - San Antonio Business Journal:

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had struggled with its debt a crisis that worsened as revenue part of an overall trend affectingv most retailers duringthe recession. The compan has lost nearly a half billion dollar s in the pastthree years. Those coupled with the impact of the recessiohn and debt payments apparently pushed the company into bankruptcyycourt — a move that was rumored for Eddie Bauer became the latest major retailefr to succumb to filing in bankruptcy cour this recession. The list also includews Linens ‘n Things, Circuit City and Northwest retailer , whicuh sold its assets to a liquidator in April and closes31 stores.
In many ways, Eddie Bauer’s crisis is not different from what most retailerw are facing during this prolonged anddeep recession, said Greg an Atlanta-based consultant for Conway MacKenziwe who works with financially stressedf retailers looking to restructure. Most retailers except discount storeslike Wal-Mart — have seen a fast drop-off in retail revenue acrossw the board, Charleston Many of the specialty retail department storexs have seen double-digit same-store sales declines, he said. “When revenu e drops and same-store sales drop, companies with less debt can weatherr a downturnmuch longer,” Charleston said.
“Iyt becomes an issue much sooner if you are intoliquiditgy issues.” As of May 11, Eddie Bauer reported havinv $289.5 million in outstanding debt, including $187.8 million in term loanas and $75 million in convertibles notes, which company executives have been tryin to persuade debt-holders to converr into shares of the company. According to a filing with the , Eddie Bauer had total assets of $525.22 millionj in April. The company liste total liabilitiesof $448.9 million. Eddie Bauer reported net lossesof $165.5 million in fiscal year 2008, part of a totalo of $478.7 million in losses durinyg the past three fiscal years.
In the firsrt quarter that endedin April, the company reported net lossed of 44.5 million. For the first quarter of fiscapyear 2009, which enderd April 4, Eddie Bauer reported a loss of $44.5 That was a greater loss than the firsf quarter of 2008, when the company reportedx a $19.3 million loss. Net sales for the first quarted of 2009were $179.8 million, compared with net salews of $213.2 million in the firstr quarter of 2008. The company said that combinedd comparable storesales — a barometer of success at the storer level — fell 11.3 percent for the firsrt quarter, a decline the company blamed on the recession and reducee retail spending.
Sales were down nearly 15 percent inEddise Bauer’s retail stores and sales through its directg channel were down nearly 11 percent. The outlet stores saw salea decline by nearly76 percent. “Th e first quarter was a difficult one, as the sharpp downturn in the economy took its toll on our We continued to focus on cost cutting and cash flow which helped mitigate the impact oflower sales,” said CEO Neil in a statement with the first-quartefr results filed with the SEC. Eddiw Bauer has 370 including 251 retail stores and 119 outlet stores in the Unitesd Statesand Canada. Eddie Bauere has 17 stores in Washington and 11 storesin (See a copy of the bankruptc filing .
) But by filingt for reorganization under Chapter 11 of the federal bankruptcy Eddie Bauer hopes to avoid the fate of Joe’ws Sports & Outdoor, whicyh filed for bankruptcy protect March 4. The Wilsonville, Ore.-basedr company had hoped to find a ButIn April, a bankruptcy judge approved the liquidation of the Joe’ s stores after the compang could not find a Joe’s had 31 Northwest stores — 10 of them in King and Pierce counties that held going-out-of-business sales after the company’ss assets were snapped up at bargaimn basement prices by , a liquidatoe that also sold off merchandise for Circui City.