Shares of the company fell 25% in premarket trading as the retailer indicated a bigger-than-expected 26% recession in same-store sales.
The company stated it would shut 150 stores, ditch three of its nine owned brands, and lower stocks in the remaining six labels, switching its strategy to concentrate on private labels.
It also postponed a plan to sell Buybuy Baby, its infant and toddler merchandise industry, and chose to cut about 20% of its corporate and supply chain workforce.
The Company Has About 32,000 Employees
The retailer stated it has booked more than $500 million in new financing, covering a new $375 million “first-in-last-out” loan, and would establish a stock offering of up to 12 million shares.
According to Jim Dixon, equity sales trader at Mirabaud, they are running out of cash and desperately require raising cash to support the business.
The retailer had a long-term deficit of $1.38 billion and only $107.5 million in cash as of May.
The company also let go of its chief operating officer and chief store officer roles.