Policies & IssuesMay 06, 2024
Rolex Files Objection to Hallmark’s New Trademark ApplicationThe Swiss watchmaker said the company’s plans to use a new version of the Hallmark crown on jewelry would confuse consumers.
FinancialsJun 18, 2020
Francesca’s Weighs Possible Bankruptcy
The COVID-19 pandemic exacerbated existing problems for the clothing and accessories chain, including declining sales and store traffic.
Francesca’s is considering bankruptcy as the COVID-19 pandemic takes a toll on its business. (Image courtesy of Flickr/Phillip Pessar)
Houston—Clothing and accessories chain Francesca's Holding Corp warned a bankruptcy may be in its future in a filing with the U.S. Securities and Exchange Commission Tuesday.
The retailer reiterated its “going concern” warning, an alert to shareholders that it may not be able to meet its financial obligations.
The warning was first issued in May following the closure of its stores and the disruptions to its supply chain amid the COVID-19 pandemic.
Francesca’s warned if it is financially unable to sustain its operations, it “may be required to delay, reduce and/or cease our operations and/or seek bankruptcy protection."
The retailer, like so many others, was hit hard by the pandemic.
In a press release, CEO Andrew Clarke described its recent fourth-quarter results as “disappointing,” posting flat year-over-year net sales of $118.9 million.
Francesca’s said it has been grappling with a decrease in comparable sales, net sales, and gross profit as well as a decline in store traffic and conversion rates.
The temporary closure of its 703 locations from late March to late April, leading to the furloughing of many of its employees, only exacerbated these issues, said the company.
As lockdown orders are lifted state by state, it has begun to reopen its locations but that has brought its own problems.
The stores operate with reduced staffing as part of a phase-in period, but the company noted it could face a shortage of employees willing to work in reopened stores.
The delay in the shipment of merchandise to its stores coupled with a drop in store traffic due to a decline in consumers’ willingness to visit malls and shopping centers, where many of its stores are located, were also listed as concerns.
The retailer’s leases for its stores, corporate headquarters, and distribution facilities are also hanging in the balance.
It stopped lease payments in April and while it intends to resume payments in July, including back rent for the missed months, it may not have the funds.
If the retailer can’t secure rent relief, its leases may be cancelled.
Francesca’s first “going concern” warning last month and its failure to pay rent violated terms of its credit agreements, but the company said lenders have granted it a waiver regarding its rent agreement.
If the retailer can’t regain compliance with the terms of its agreements, it could default on them and be unable to borrow under the credit agreements.
The company is still assessing the overall impact of COVID-19 and told the SEC it needs more time to file its first-quarter results.
“The extent to which the COVID-19 pandemic continues to impact our results will depend on future developments that are highly uncertain and cannot be predicted at this time, including new information that may emerge concerning the severity of the virus and the actions to contain its impact,” said Francesca’s.
Signet Jewelers Ltd. also requested more time to file its quarterly report from the SEC last week for similar reasons.
Francesca’s is expected to file its quarterly report no later than 45 days after June 16.
More on Financials
The Latest
EditorsMay 06, 2024
Q&A: 8 Questions With Anglo American’s Benny Oeyen The executive talked about the importance of self-purchasers and how fuel cell electric vehicles are going to fuel demand for platinum.
MajorsMay 06, 2024
Malabar Gold & Diamonds Opens 4th U.S. ShowroomThe Indian jeweler’s new store in Naperville, Illinois marks its 350th location, part of its ongoing global expansion plans.
Brought to you by
From Registration to Return: 10 Tips to Protect You Before, During and After a TradeshowTradeshow risks are real. Get tips to protect yourself before, during and after and gain safety and security awareness for your business.
Events & AwardsMay 06, 2024
Ben Bridge Jeweler Accepting Applications for Lonia Tate ScholarshipIt will award a graduating high school student with about $10,000 toward a GIA diploma and an internship with the Seattle-based jeweler.
Weekly QuizMay 02, 2024
This Week’s QuizTest your jewelry news knowledge by answering these seven questions.
CrimeMay 03, 2024
Second Suspect Arrested in Murder of Colorado JewelerWheat Ridge, Colorado police took a 50-year-old man into custody Wednesday following a two-month search.
CollectionsMay 03, 2024
A Sneak Peek Into PGI’s Couture Platinum Spotlight ProgramPGI partnered with four new and seven returning designers for its annual platinum capsule collection.
Brought to you by
Rio’s Reimagined Podcast: For the Love of JewelersMeet Ben Claus—grand prize winner of For the Love of Jewelers 2023 Fall Design Challenge.
MajorsMay 03, 2024
Kristie Nicolosi Joins WJA Board AgainNicolosi, president and CEO of The Kingswood Company, previously sat on WJA’s board from 2011 to 2018.
CollectionsMay 03, 2024
Piece of the Week: A “Bit of LUV” for the DerbyKarina Brez’s race-ready piece is a sophisticated nod to the horse-rider relationship.
CrimeMay 02, 2024
4 Indicted in Burglary Ring Targeting Indian, South Asian FamiliesThe men are allegedly responsible for stealing millions in jewelry and other valuables in 43 burglaries in 25 towns across Massachusetts.
CollectionsMay 02, 2024
Foundrae Launches ‘Horizon’ Collection“Horizon” invites individuals to explore the limitless possibilities that lie ahead, said the brand.
IndependentsMay 02, 2024
Oklahoma Jeweler Glenn Lewis Dies at 68The co-founder of Lewis Jewelers was also the longtime mayor of the city of Moore.
AuctionsMay 02, 2024
Vintage Baume & Mercier With Ties to Elvis Sells for $7K Elvis Presley gifted this circa 1967 gold and diamond watch to Dodie Marshall, his co-star in “Easy Come, Easy Go.”
SurveysMay 01, 2024
Consumer Confidence Falls in AprilConcerns about rising prices, politics, and global conflicts continue to dampen consumer outlook.
TrendsMay 01, 2024
Amanda’s Style File: All Eyes on EmeraldsMay’s birthstone is beloved for its rich green hue and its versatility.
SourcingMay 01, 2024
Opsydia Names New Sales and Marketing Director Jacqui Larsson joins Opsydia with nearly two decades of experience in the industry.
CrimeMay 01, 2024
Grand Jury to Hear Case Against Jeweler Charged in Fatal Shove Following IJO ShowLast month in Dallas, David Walton pushed another jeweler, David Ettinger, who later died.
CollectionsApr 30, 2024
12 Otherworldly Pieces From Tiffany & Co.’s 2024 Blue BookThe “Tiffany Céleste” collection reimagines designer Jean Schlumberger’s interpretations of the universe.
MajorsApr 30, 2024
Zales Celebrates 100 Years With New CampaignThe brand also created a 100-carat lab-grown diamond necklace in honor of its centennial.
MajorsApr 30, 2024
Platinum Guild International Appoints New CEOTim Schlick has been promoted from his previous position as COO.
Events & AwardsApr 30, 2024
Canadian Jewellers Association Brings Back the Summit It’s the second year for the event, slated to take place in October in Toronto.
Recorded WebinarsApr 29, 2024
Watch: Diamond Identification and Evaluation - How to Protect your BusinessSupplier Spotlight Sponsored by GIA
SourcingApr 29, 2024
De Beers to Move Auction HQ from Singapore to BotswanaSales will be paused while the relocation takes place over the next few months.
CollectionsApr 29, 2024
Simone I. Smith Mixes Denim and Diamonds in New Collection“SIS x MISA Denim and Diamonds” is a collaboration between the designer and celebrity stylist Misa Hylton.
IndependentsApr 29, 2024
Venus Jewelers Relocating After 45 YearsThe retailer is moving to a newly designed space in the same shopping center.
