Aeropostale Filing For Bankruptcy
Today, Aeropostale, the popular teen retail store, filed for bankruptcy. For the past thirteen fiscal quarters Aeropostale has loss money. The debt accrued by Aeropostale is a hefty 390 million. The money that the company has secured is 160 million, while the assets listed for the Chapter 11 bankruptcy is approximately 354 million. The store claims that they will be closing 113 stores in the United States and 41 stores in Canada in order for them to meet their financial obligations and eventually become more stable. Aeropostale stated that they plan on landing on their feet from bankruptcy within the next year or so. Aeropostale claimed that they need to cancel or revise some of the contracts of their partners and solve a dispute with Sycamore Partners, a former investor of theirs. Aeropostale will continue selling themselves to potential customers. Aeropostale stated that any sale that they have will be announced within six months.
Sales, Discounts, Clearance Still No Change
Though Aeropostale has significantly lowered the prices of their merchandise, they have still suffered astronomical losses. In the last quarter sales fell by a whopping 16 percent. Aeropostale has been under heat for a while.
Other companies in the same price range as Aeropostale were hurt by the changing fashion trends. Companies like Forever 21 and H&M quickly adapted to the changing fashion trends; their response left them unharmed. Classic companies like American Eagle and Banana republic were left behind as well. One of the main factors of the downfall of those companies is the fact that newer and more modern companies are beating them with lower prices.
In addition to all of the calamities that Aeropostale is facing, the New York Stock Exchange alerted them saying, “due to their lower stock prices they will no longer be listed as of April.”