House2Home Seeks Financial Options

Beleaguered home-decorating retailer House2Home Inc. said it is facing a cash crunch as sales continue to slump.

The Irvine company, acknowledging that it is running out of options, said it failed to make an interest payment due Thursday and is discussing “liquidity issues and various financial scenarios” with its bank group. The statement did not provide details, and executives did not return calls.

The retailer’s statement, released after the close of U.S. markets, said sales have continued to decline since Oct. 23, when it said it would turn away deliveries of new merchandise for up to three weeks to reduce its inventory. At the time, House2Home said sales had fallen 25% to 30% after the terrorist attacks.

House2Home shares rose 3 cents to 30 cents on the NYSE. On Thursday, the stock hit a 52-week low of 25 cents.