RadioShack Again Warns of Bankruptcy in Amended Report
The holiday season looks ugly at RadioShack, causing the electronics retailer to file an amended annual report again warning it may be heading to bankruptcy court.
“Since the filing of the 10-K, we have experienced losses that continued to accelerate into the third quarter of fiscal 2015, primarily attributed to a prolonged downturn in our business,” the amended report said, filed December 12.
“We may not have enough cash and working capital to continue to fund our operations beyond the near term, which raises substantial doubt about our ability to continue as a going concern.”
RadioShack has closed 175 underperforming stores since the beginning of the current fiscal year. “We may close additional underperforming stores and take other measures to reduce our cost structure,” the report said, signed by Holly Felder Etlin, interim CFO.
Etlin was replaced as chief financial officer after the latest filing, by Carlin Adrianopoli of FTI Consulting, according to the Wall Street Journal.
The report warned: “We may be required to seek to implement in-court bankruptcy proceedings, which could result in a default on our debt with our lenders and/or the liquidation of the company and the loss of your investment in the company.” RadioShack first warned of possible bankruptcy in September.
RadioShack was down to about $63 million cash on hand in November, a decrease from about $535 million at the start of 2013, according to the report, and posted a net loss of $400.2 million for last fiscal year. The retailer has 4,297 U.S. company-operated stores, and had a network of 943 RadioShack dealer outlets, including 42 located outside North America.