Francesca’s has issued another warning that it could go bankrupt FootwearNews.com reported. In a filing on Monday with the Securities and Exchange Commission, the already-struggling retailer announced that the coronavirus-induced shutdown of its more than 700 boutiques from late March through the end of April had led to significant declines in its comparable sales, net revenues and gross profits. It expressed a need to obtain additional financing to keep its business up and running or enter into chapter 11 protection. The warning comes a month after Francesca’s said it had substantial doubt about its ability to continue as a going concern. It has also failed to pay rent on its leased locations for the months of April, May and June, which it said violates certain covenants under its asset-based credit and term loan agreements. As of Feb. 1, Francesca’s had 5,236 employees — 1,159 of which work full time and 4,077 part time — but it furloughed “substantially all of our corporate and boutique employees” in mid-April as part of broader efforts to improve liquidity. It has also reduced the base salaries of its senior leadership team, as well as suspended all capital expenditures and limited its investments in e-commerce.
