Francesca's to close 140 stores by end of January
Francesca's Holdings Corp. is considering its options, including bankruptcy.
The accessories and apparel retailer said Monday in an 8-K filing that it plans to close approximately 140 stores by Jan. 31, 2021, with the number subject to change. Francesca’s, which has some 700 stores, said it expects to incur charges of approximately $29.0 million to $33.0 million during thirty-nine weeks ended October 31, 2020 related to the closings.
The retailer said is evaluating various options to improve its financial and liquidity situation, including further lease concessions, further reductions of operating and capital expenditures and restructuring of its debt and liabilities through a private restructuring or a restructuring under the protection of bankruptcy laws.
The news was not unexpected. In a June SEC filing, Francesca's warned that its liquidity has been adversely impacted by negative operating results due to the pandemic and “there is no assurance that we will have sufficient liquidity to continue operations.”
The company said a bankruptcy restructuring is also an option under consideration. "If the company is unable to raise sufficient additional capital to continue to fund operations and pay its obligations, the company will likely need to seek a restructuring under the protection of applicable bankruptcy laws," the company said.