Cherokee Has 2nd-Quarter Loss of $5.1 Million

Cherokee Inc., a struggling apparel maker based in Sunland, posted a $5.1-million loss for its fiscal second quarter, compared with a loss of $1.43 million a year earlier.

The latest loss in the quarter ended Nov. 28 largely reflected interest costs on Cherokee’s burdensome debt, which the company is attempting to restructure. The company’s second-quarter sales dropped 26%, to $32.2 million from $43.5 million.

Cherokee is working with its creditors to restructure its balance sheet, mainly by having the creditors exchange their claims for a majority of the company’s stock. Cherokee’s biggest debt is $105.3 million of junk bonds that are outstanding.

For the first half of its fiscal year, Cherokee lost $9.33 million, compared with a year-earlier loss of $1.36 million, and its six-month sales fell 25%, to $73.1 million from $97.4 million.