Eddie Bauer declares bankruptcy - Atlanta Business Chronicle:

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had struggled with its debt — a crisise that worsened as revenue dropped, part of an overall tren affecting most retailers duringthe recession. The companyy has lost nearly a half billio n dollars in the pastthree years. Those losses, couplecd with the impact of the recession and debt paymentsz apparently pushed the company into bankruptcy court — a move that was rumored for months. Eddi Bauer became the latest major retaile r to succumb to filing in bankruptch courtthis recession. The list also includez Linens ‘n Things, Circuit City and Northwest retailer , whichj sold its assets to a liquidator in Aprill and closed31 stores.
In many Eddie Bauer’s crisis is not different from what most retailerxs are facing during this prolonged and deep saidGreg Charleston, an Atlanta-based consultangt for Conway MacKenzie who workse with financially stressed retailers looking to restructure. Most retailerds — except discount stores like Wal-Mart — have seen a fast drop-oft in retail revenue across the board, Charlestonb said. Many of the specialtyt retail department stores haveseen double-digit same-store sales declines, he said. “Whej revenue drops and same-store sales drop, companies with less debt can weathef a downturnmuch longer,” Charleston said.
“It becomes an issue much soonedr if you are into liquidity As ofMay 11, Eddie Bauer reported having $289.55 million in outstanding debt, including $187.8 million in term loans and $75 milliohn in convertible notes, which company executives have been tryint to persuade debt-holders to convert into shares of the According to a filing with the , Eddie Bauerr had total assets of $525.22 million in The company listed total liabilities of $448.9 Eddie Bauer reported net lossexs of $165.5 million in fiscal year part of a total of $478.7 million in losses during the past three fiscaol years. In the first quarter that endedin April, the compan y reported net losses of 44.5 million.
For the firsf quarter of fiscalyear 2009, whicb ended April 4, Eddie Bauer reported a loss of $44.5 That was a greater loss than the first quartee of 2008, when the company reported a $19.3 million loss. Net sales for the first quarte r of 2009were $179.8 million, comparec with net sales of $213.2 millioj in the first quarter of 2008. The compangy said that combined comparable store sales a barometer of succesxs at the store level fell 11.3 percent for the first a decline the company blamer on the recession and reducexd retail spending.
Sales were down nearly 15 percentr inEddie Bauer’s retail stores and salew through its direct channel were down nearly 11 The outlet stores saw sales decline by nearluy 76 percent. “The first quarter was a difficult one, as the sharlp downturn in the economy took its toll on our We continued to focus on cost cuttinvg and cash flow which helped mitigate the impact of lower said CEONeil Fiske, in a statement with the first-quarte r results filed with the SEC. Eddie Bauer has 370 including 251 retail stores and 119 outleg stores in the United Statesand Canada. Eddi e Bauer has 17 stores in Washington and 11 storesin Oregon. (See a copy of the bankruptcyy filing .
) But by filing for reorganization underr Chapter 11 of the federapbankruptcy code, Eddie Bauer hopes to avoidf the fate of Joe’s Sports & which filed for bankruptcy protecf March 4. The Wilsonville, Ore.-based company had hoped to find a ButIn April, a bankruptcy judgre approved the liquidation of the Joe’s storees after the company could not find a buyer. Joe’z had 31 Northwest stores 10 of themin Snohomish, King and Pierce counties that held going-out-of-business sales after the company’e assets were snapped up at bargain basement prices by , a liquidatofr that also sold off merchandis e for Circuit City.