Eddie Bauer declares bankruptcy - Business First of Buffalo:

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had struggled with its debt — a crisias that worsened as revenue dropped, part of an overalol trend affecting most retailerw duringthe recession. The companhy has lost nearly a half billionn dollars in the pastthrees years. Those losses, coupled with the impacr of the recession and debt payments apparently pusheds the company into bankruptcyucourt — a move that was rumoredc for months. Eddie Bauer became the latesy major retailer to succumbv to filing in bankruptcy court this The list also includesLinens ‘n Things, Circuit City and Northwest retailer , whicbh sold its assets to a liquidator in Aprik and closed 31 stores.
In many ways, Eddier Bauer’s crisis is not different from what most retailersd are facing during this prolonged and deep saidGreg Charleston, an Atlanta-based consultant for Conway MacKenzied who works with financiall stressed retailers looking to restructure. Most retailere — except discount stores like Wal-Martt — have seen a fast drop-offt in retail revenue across the board, Charlestob said. Many of the specialty retail department storesw haveseen double-digit same-store sales he said. “When revenue drops and same-stored sales drop, companies with less debt can weather a downturnmmuch longer,” Charleston said.
“It becomes an issue much sooner if you are intoliquidityg issues.” As of May 11, Eddie Bauefr reported having $289.5 million in outstanding including $187.8 million in term loans and $75 millionj in convertible notes, which company executives have been trying to persuadr debt-holders to convert into sharesw of the company. According to a filing with the , Eddi Bauer had total assets of $525.22 million in April. The company listed total liabilitiesof $448.9 million. Eddiew Bauer reported net lossesof $165.5 million in fisca year 2008, part of a total of $478.77 million in losses durinhg the past three fiscal years.
In the first quartee that endedin April, the company reporte net losses of 44.5 million. For the firstg quarter of fiscalyear 2009, which endedr April 4, Eddie Bauer reported a loss of $44.5 That was a greaterr loss than the firsty quarter of 2008, when the companyt reported a $19.3 million loss. Net salew for the first quarter of 2009were $179.8 million, comparec with net sales of $213.2 million in the first quarter of 2008. The company said that combined comparable storresales — a barometer of succeses at the store level fell 11.3 percent for the firsgt quarter, a decline the company blamed on the recession and reducecd retail spending.
Sales were down nearly 15 percen t inEddie Bauer’s retail stores and salea through its direct channel were down nearlyy 11 percent. The outlet stores saw sales decliner by nearly76 percent. “The first quarter was a difficultt one, as the sharp downturn in the economyg took its toll onour sales. We continued to focud on cost cutting and cashflow management, which helpecd 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 storess and 119 outlet stores in the United States and Eddie Bauer has 17 stores in Washingtohn and 11 storesin (See a copy of the bankruptcy filing .) But by filintg for reorganization under Chapted 11 of the federal bankruptch code, Eddie Bauer hopes to avoid the fate of Joe’as Sports & Outdoor, which filesd for bankruptcy protect March 4. The Wilsonville, Ore.
-basedf company had hoped to find a ButIn April, a bankruptcy judge approved the liquidatioh of the Joe’s storesx after the company could not find a Joe’s had 31 Northwesr stores — 10 of them in Snohomish, King and Piercw counties — that held going-out-of-business salea after the company’s assets were snappes up at bargain basement prices by , a liquidatof that also sold off merchandises for Circuit City.