Furniture retailer Conn\u2019s filed for bankruptcy and is shutting down outlets nationwide after experiencing a slowdown in recent years that negatively affected the firm\u2019s sales and liquidity.<\/p>\n
The Chapter 11 bankruptcy was\u00a0filed<\/a>\u00a0on July 23 in the U.S. Bankruptcy Court for the Southern District of Texas. Founded in 1890, Conn\u2019s operates 553 retail stores across the country that will be closed as part of the bankruptcy proceedings. The company has started running store closing sales at some of its locations and requested the court to allow it to continue with these sales.<\/p>\n The bankruptcy filings were made after the company\u2019s growth faced \u201csignificant headwinds\u201d in recent years, CEO Norman J. Miller\u00a0said<\/a>\u00a0in another court filing. These challenges include \u201cdrastic shifts\u201d in consumer behavior, interest rate pressures, inflation, and integration delays and increased costs associated with the firm\u2019s merger during 2023\u201324, he stated.<\/p>\n \u201cThe resulting slowdown in the Company\u2019s growth has placed a strain on the company\u2019s sales and liquidity position,\u201d Mr. Miller said.<\/p>\n Conn\u2019s key debtors reduced the debt limit available to the firm, and the company was forced to take in loans at higher costs.<\/p>\n The company sought alternative financing arrangements to stabilize its financial position. However, none of these attempts bore fruit.<\/p>\n Given the macroeconomic headwinds faced by Conn\u2019s and the poor merger and acquisition environment in the consumer retail sector, the firm chose to commence Chapter 11 proceedings, the filing said.<\/p>\n Conn\u2019s voluntary bankruptcy\u00a0petition<\/a>\u00a0states that it has between 25,001 and 50,000 creditors, with assets and liabilities in the range of $1 billion to $10 billion.<\/p>\n The furniture retailer has already\u00a0listed<\/a>\u00a071 stores that it intends to close down soon. The store closures affect outlets in 13 states. Florida is set to see the highest number of closures at 18, with single digits in other states. The firm has outlets in 15 states in total and employs roughly 4,000 individuals.<\/p>\n The company\u2019s\u00a0shares<\/a>\u00a0have crashed significantly over the past year, with its value declining by more than 92 percent. On July 24 alone, shares fell by more than 30 percent.<\/p>\n Late last month, Conn\u2019s received delinquency\u00a0notification<\/a>\u00a0from the NASDAQ exchange after it failed to file a quarterly report for the period ended April 30. The firm was given until Aug. 19 to rectify the issues.<\/p>\nShares Crash<\/h2>\n