Ascena Retail (hereinafter referred to as Ascena) Group, the parent company of American women’s clothing brands Ann Taylor and Lane Bryant, officially filed for bankruptcy protection on Thursday.
The latest news shows that Ascena has submitted documents to the U.S. Bankruptcy Court for the Eastern District of Virginia, hoping to pass bankruptcy The protection process allowed the company to avoid outright collapse, allowing it to cut debt and close weak stores to minimize operating costs. According to Ascena Retail’s latest annual report, the move could bring changes to more than 50,000 jobs. As of February 1 this year, the group has opened a total of 2,764 stores around the world.
The company currently counts approximately $12.5 billion in liabilities and has secured loans with more than 68% of its secured term lenders, the company said in a statement. Entered into a restructuring support agreement. The restructuring plan is expected to help the company reduce its debt by approximately $1 billion. In addition, Ascena will receive $150 million in new funding from existing lenders.
Ascena interim executive chairman Carrie Teffner said in an interview: “With the cash we have from continuing operations and the new funding we have received from lenders, we expect to be in a court-supervised process. There is sufficient cash flow to support our daily operations. We hope to complete this process as soon as possible.”
Due to the outbreak, Ascena CEO Gary Muto In mid-March, it temporarily closed approximately 2,800 of the group’s stores in the United States, Canada and Puerto Rico. It began reopening in early May after the state government lifted restrictions. However, traffic at Ascena’s stores remained below normal levels in the last three weeks of May, while store sales fell by 30% to 80%, according to a June lender report.
Management predicts that in the current fiscal year ending in August, the group’s overall revenue will fall by 21%, and losses will continue into 2021.
In fact, Ascena itself had been having financial problems before the epidemic, with sales declining and loans surging to more than $1 billion . According to Bloomberg, Ascena Retail has tried to sell two of its fashion chain retailers as the group’s losses continue to increase and there are signs that creditors have lost confidence in its prospects.
Ascena said in a statement that under the restructuring plan, the company will close many Justice stores and close some Ann Taylor, LOFT, Lane Bryant and Lou & Gray stores.
Since the outbreak of the new crown epidemic, many American fashion retailers have announced that they have filed for bankruptcy protection, including J.C. Penney, J.Crew, Brooks Brother and Neiman Marcus.
About Ascena Retail
Ascena Retail was founded in 1962 by a Founded by female entrepreneur Roslyn S. Jaffe and her husband, headquartered in New Jersey, it was originally intended to provide an increasingly large group of professional women with clothing to wear at work as women had more and more opportunities to enter the labor market.
Now it has become the largest specialty retailer of women’s and girls’ clothing in the United States. The group consists of seven brands, including: Ann Taylor, LOFT, Lou & Gray, Lane Bryant, Cacique, Catherines and Justice.
As of the last fiscal year, Ascena Retail’s annual sales revenue was US$5.49 billion. </p
