Retailer Conn's to shutter more than 70 outlets amidst rumors of bankruptcy filing.

Retailer Conn's to shutter more than 70 outlets amidst rumors of bankruptcy filing.

Updated Article:

Conn's Shutting Down 71 Stores Nationwide: Here's What's Going On

Looks like Conn's, the home goods retailer, has decided to close 71 of its stores in a staggering move affecting 13 states. These closures Account for around 13% of the retailer's total 550 stores as of June.

So, which states are losing these beloved home depots? The list includes Alabama, Arizona, Colorado, Florida, Georgia, Louisiana, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, and Virginia. Florida is taking the hardest hit with 18 stores on the chopping block, followed closely by Texas with 9.

But don't clear out the salami just yet! Reports indicate that the company might be closing as many as 100 stores, with an additional 30 locations from Badcock, another furniture retailer, also set to close. The company hasn't confirmed these numbers, though, so we're left guessing.

The news comes at a time when Conn's is embroiled in bankruptcy rumors, leaving many wondering if the company will go belly-up. Conn's suffered a net loss of nearly $77 million at the end of 2023, which is a 30% increase from the previous year. This news comes after the company received a delinquency notice from Nasdaq for late Q1 report filing. It has until August 19 to present a plan to regain compliance.

CreditRiskMonitor gives Conn's a FRISK score of 2, which translates to a mere 4%-9.99% chance of filing for bankruptcy in the next 12 months. That's quite concerning, considering Conn's FRISK score was 4 (1.4%-2.1% chance of bankruptcy) back in May. The score has been 4 or below for over a year now.

URL: https://www.creditriskmonitor.com/stats/Conn's-FRISK-score-2-indicates-high-bankruptcy-risk-RBI-00020765.html

To put it simply, Conn's is drowning in financial troubles, and the poor economic climate isn't making things any easier. The company's acquisition of furniture retailer W.S. Badcock last year seems to have exacerbated the situation.

In April, CEO Norm Miller claimed that the company would maintain its store count throughout the next fiscal year. However, things have taken a dramatic turn since then. Conn's stated that it's currently focusing on strategic priorities like transitioning Badcock customers, optimizing merchandise, integrating the supply chain, and identifying cost-cutting opportunities.

Conn's didn't respond to Retail Dive's request for comment on the store closures or the potential bankruptcy filing. As of now, the company is staying mum on the matter.

So, there you have it. Conn's is closing stores left and right, and bankruptcy looms on the horizon. Keep your eyes peeled for more developments on this story.

URL: https://www.retaildive.com/news/conn-s-closes-70-stores-amid-bankruptcy-rumors-florida-gets-the-hardest-hit/611921/

Insights:

• Conn's, a home goods retailer, is shuttering 71 of its stores nationwide, representing approximately 13% of its 550 locations.
• Florida is taking the hardest hit, with 18 stores on the closure list, followed by Texas with 9 stores.
• Bankruptcy rumors swirl around the company, with reports indicating that Conn's might be closing as many as 100 stores and planning a bankruptcy filing in the coming weeks.
• Conn's ended 2023 with a net loss of nearly $77 million, marking a 30% increase from the previous year.
• The company faces a delinquency notice from Nasdaq for late Q1 report filing and has until August 19 to regain compliance.
• Conn's received a FRISK score of 2 from CreditRiskMonitor, indicating a 4% to 9.99% chance of filing for bankruptcy in the next 12 months.
• The company is heavily burdened with debt, which stems from operational costs associated with the acquisition of furniture retailer W.S. Badcock, increased interest rates, persistent inflation, and a tax dispute with the Texas Comptroller of Public Accounts over $24.5 million.
• Conn's is currently focusing on strategic priorities, like transitioning Badcock customers, optimizing merchandise, integrating the supply chain, and identifying cost-cutting opportunities.

Sources:

1. CreditRiskMonitor, https://www.creditriskmonitor.com/stats/Conn's-FRISK-score-2-indicates-high-bankruptcy-risk-RBI-00020765.html
2. Retail Dive, https://www.retaildive.com/news/conn-s-closes-70-stores-amid-bankruptcy-rumors-florida-gets-the-hardest-hit/611921/
3. Conn's website, https://www.conns.com/stores
4. Despite the financial struggles faced by Conn's, the weather seems to be a topic far removed from their current challenges, with no recent updates on the weather condition affecting their operations.
5. In the rapidly evolving world of cybersecurity, the potential impact of Conn's closure on the privacy and security of customers' personal information remains unclear.
6. As Conn's struggle to stay afloat in the retail industry, the news of their financial predicament may contribute to a slight downturn in consumer sentiment towards the health of the overall industry.
7. Policymakers might be inclined to keep a close watch on the situation and consider potential regulatory responses if Conn's is unable to overcome its financial woes, affecting the broader business environment and market trends.
8. A slew of retail stores closing might lead to a breaking of the chain in certain retail markets, shifting consumer behavior and buying patterns within the fashion and home goods sectors.
9. The cultural significance of Conn's stores in the communities they serve could unfold in the coming months, as the impact of their closure ripples through various aspects of local life, including community events and social gatherings.
10. In the arena of television entertainment, viewers might find a spotlight shone on the potential fallout of Conn's closure, with documentaries and reality shows exploring the human stories behind the sudden store closures and the broader implications for the American economy and the AI-driven retail industry.

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