American Apparel fights to stay on NYSE, expects annual report delay
American Apparel Inc. is fighting to retain its listing on the New York Stock Exchange while buried in negotiations over financing -- efforts that the Los Angeles retailer said would force it to file its annual report late.
The clothing manufacturer and seller will delay its financial data report for the year ended Dec. 31, it said in a Securities and Exchange Commission document submitted after trading closed Tuesday.
The NYSE sent American Apparel a letter Feb. 28 accusing the retailer of failing to reach the exchange’s listing standards. American Apparel said in Tuesday’s filing that it is working to finish a compliance plan due Friday.
The NYSE requires the retailer to meet its requirements by April 15, according to American Apparel, which said “management has devoted considerable resources to the development” of the compliance plan.
The filing, signed by Chief Financial Officer John Luttrell, also notes that American Apparel has asked advisors for help restructuring the company’s debt.
The retailer is also “actively pursuing several possible financing alternatives” to boost the amount of available cash to funnel into operations and debt requirements, according to the document.
American Apparel stressed that “no assurance can be given” that it would be successful in its refinancing strategy.
In early March, Adrian Taylor said he would resign as American Apparel’s vice president of finance and controller in order to jump to another company. Luttrell assumed Taylor’s controller duties Friday.
This month, the retailer estimated a widening net loss of $105 million, or 95 cents a share, for 2013, compared with a loss of $37 million, or 35 cents, a year earlier. Revenue was projected to be $634 million, up 3% year over year.
But gross profit was expected to slip to $321 million from $327 million in 2012 because of promotional offers and higher costs that were “largely due” to American Apparel’s transition to a new distribution center in La Mirada, according to the company.
The retailer’s operating expenses likely rose last year to $349 million from $326 million a year earlier, the company said. American Apparel said it had an estimated $8.7 million in cash as of Dec. 31 and $3.9 million as of Feb. 28.
In February, the company said preliminary sales for January showed a 1% sales decline and a 5% slide in same-store sales, which considers only stores open at least a year.
In a statement, Chief Executive Dov Charney blamed “the extraordinarily cold winter weather and winter storms in the U.S.”
Company stock Tuesday rose 6.8%, or nearly 5 cents, to 78 cents and remained unmoved in after-market hours.
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