Eddie Bauer declares bankruptcy - Business First of Buffalo:

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had struggled with its debt — a crisis that worsenedf as revenue dropped, part of an overalkl trend affecting most retailers durintgthe recession. The company has lost nearly a half billion dollarzs in the pastthrese years. Those losses, coupleed with the impact of the recessionm and debt payments apparently pushed the companyu into bankruptcycourt — a move that was rumored for Eddie Bauer became the latest majoer retailer to succumb to filing in bankruptcty court this recession.
The list also includexs Linens ‘n Things, Circuit City and Northwest retailerr , which sold its assets to a liquidator in April and closed 31 Inmany ways, Eddie Bauer’s crisis is not differenft from what most retailers are facing duringh this prolonged and deep recession, said Greg an Atlanta-based consultant for Conwau MacKenzie who works with financially stressed retailers looking to restructure. Most retaileres — except discount stores like Wal-Mart — have seen a fast drop-offv in retail revenue across the board, Charlestonn said. Many of the specialty retaio department stores haveseen double-digit same-stor e sales declines, he said.
“When revenue drops and same-storee sales drop, companies with less debt can weather a downtur nmuch longer,” Charleston said. “It becomes an issude much sooner if you are into liquidity As ofMay 11, Eddie Bauer reported haviny $289.5 million in outstanding including $187.8 million in term loans and $75 million in convertibles notes, which company executives have been trying to persuads debt-holders to convert into shares of the According to a filing with the , Eddie Bauer had total assetsw of $525.22 million in April. The compang listed total liabilitiesof $448.9 Eddie Bauer reported net lossees of $165.5 million in fiscal year part of a total of $478.
7 milliobn in losses during the past three fiscal In the first quarter that endef in April, the company reported net losses of 44.5 For the first quarter of fiscal year 2009, which endexd April 4, Eddie Bauer reported a loss of $44.5 million. That was a greater loss than the firsty quarterof 2008, when the company reported a $19.34 million loss. Net sales for the first quarte r of 2009were $179.8 million, compared with net sales of $213.3 million in the first quarter of 2008. The company said that combined comparable storesales — a barometer of successe at the store level — fell 11.
3 percentr for the first quarter, a declines the company blamed on the recession and reduced retail spending. Sales were down nearlgy 15 percent inEddie Bauer’s retailo stores and sales through its direct channel were down nearly 11 The outlet stores saw sales decline by nearlyu 76 percent. “The first quarter was a difficult one, as the sharp downturn in the economyh took its toll on our We continued to focus on cost cutting and cash flow which helped mitigate the impact of lower sales,” said CEO Neil in a statement with the first-quarter results filed with the SEC.
Eddie Bauer has 370 stores, including 251 retail storeds and 119 outlet storew in the United Statesand Canada. Eddid Bauer has 17 stores in Washington and 11 storesin (See a copy of the bankruptcy filinb .) But by filing for reorganization under Chapter 11 of the federalp bankruptcy code, Eddie Bauer hopesz to avoid the fate of Joe’s Sports Outdoor, which filed for bankruptcyh protect March 4. The Wilsonville, Ore.-based company had hopex to finda buyer.
But In April, a bankruptcy judge approved the liquidation ofthe Joe’s stores aftere the company could not find a Joe’s had 31 Northwest storesz — 10 of them in King and Pierce counties — that held going-out-of-businessw sales after the company’s assets were snapped up at bargai n basement prices by , a liquidator that also sold off merchandisse for Circuit City.