As much as we like to rag on them, it’s hard to imagine a world without American Apparel.
Sure most of us could do without their gold lamé pants, but there are few people who haven’t picked-up a pair of leggings or a tank top at the retail chain at some point or another.
It now appears, however, that the chain may have to close as much as a third of their New York City stores in what is just the latest hiccup in their seemingly endless financial and legal troubles.
The California-based company currently operates 20 Manhattan and Brooklyn outlets, the majority of which were opened in the last five years.
Though the company has yet to publicly bolster this shutter statement that was set forth by Crain’s, American Apparel noted just a few days ago that it might not have enough cash to last through the end of the year.
You can just imagine the effect on their stock after that announcement.
The SEC already threatened to de-list the company from the stock exchange after they failed to file their second quarter earnings on time.
According to Crain’s, its debt – as of June 30 – was more than $120 million, up 30% from the prior quarter.
For the quarter ending June 30, the company expects a loss of $5 million to $7 million, compared with a profit of $7.3 million in the same quarter a year earlier.
If there’s a poster child for success being fleeting if you’re not careful, this would be it.
It’s hard to grasp the that a company that rose so quickly and with such panache could be over $100 million in debt.
Just how long it will be before hipsters will have to go an extra mile for their $22 fluorescent tank top – only time will tell.
Let’s just hope it’s not the likes of Abercrombie and Hollister’s that open in AA’s place.