It’s becoming apparent that Express Inc. could be the next company to fall victim to the relentless clutches of the current economic crisis. Speculation is growing about the company’s financial status and the possibility of impending bankruptcy.
The clothing retailer is believed to have hired restructuring consultant M3 and law firm Kirkland & Ellis, the Wall Street Journal reported earlier this week. This news caused the company’s share price to plummet by 40 percent.
According to the media outlet, the company is currently pursuing a debt restructuring, which could include filing for bankruptcy in the coming weeks.
Express has been racking up significant losses recently, posting a net loss of $154.3 million in the nine months ended Oct. 28. The company’s total debt now stood at $274.7 million.
But as reports continue to circulate, Express CEO Stewart Glendinning, who took over after former boss Tim Baxter left in September, has taken a strong stance and tried to keep staff calm.
“We have made tremendous progress in our transformation in recent months: we have implemented a number of cost-cutting initiatives, made changes to our workforce and streamlined our processes to improve the efficiency of our operations,” Glendinning said in an internal memo provided to the Industry magazine WWD. “We acted with urgency and achieved a lot in a short time, and I am grateful for your efforts. I also realize that all of these changes were not easy, but they were necessary to prepare our organization for the future to position.”
The CEO further explained that the company is “proactively conserving” its liquidity while it awaits a government payment under the Coronavirus Aid, Relief and Economic Security Act.
This translated post previously appeared on FashionUnited.com