American Apparel Faces Stock Delisting Over Delayed Annual Report

From American Apparel's Spring Lookbook

From American Apparel’s Spring Lookbook

Los Angeles—American Apparel Inc. said Tuesday that it is trying to meet the New York Stock Exchange’s March 21 deadline to file a compliance report or face delisting.

In its filing with the Securities and Exchange Commission (SEC), American Apparel reported that it working on an end of 2013 fiscal year report but that its efforts to restructure debt and financial alternatives had delayed the report since some of the changes could lead to changes in the annual report.

2013 Loss Widens

The NYSE had sent a letter Feb. 28 accusing American Apparel of failing to meet its listing standards. But American Apparel claims its “management has devoted considerable resources to the development” of a compliance plan.

The company also said in the SEC filing that it expects to report a full year net loss of $105 million, or 95 cents a share, compared with a loss of $37 million, or 35 cents, in the prior year. Revenue was up 3% to $634 million.

Gross profit was expected to be down, however, to $321 million from $327 million in 2012 primarily due to promotional offers and higher costs that were “largely due” to American Apparel’s transition to a new distribution center in La Mirada.

American Apparel’s operating expenses evidently rose to $349 million last year from $326 million a year earlier. The company estimated $8.7 million in cash as of Dec. 31, and $3.9 million as of Feb. 28.

 

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