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Crafts retailer Joann Inc. (NASDAQ:JOAN) experienced a 5.6% drop in after-hours trading following news of ongoing negotiations with lenders to bolster its cash reserves.
Amid concerns of potential financial distress, a report from Bloomberg outlined the company’s efforts to secure a cash infusion from lenders, potentially averting a bankruptcy filing. The report, which cited sources familiar with the matter, indicated that talks are ongoing, and no concrete terms have been finalized.
A company spokesperson declined to comment on the matter when approached by Bloomberg.
Joann (JOAN) previously encountered a 35% share price decline on December 5, after reporting Q3 sales below estimates and a wider-than-expected adjusted loss. Suffering an 83% stock devaluation over the past year, the company’s struggles signal wider challenges in the retail industry.
The report from Bloomberg also noted that other retailers, including Big Lots (BIG) and Children’s Place (PLCE), have been grappling with similar financial predicaments. The Wall Street Journal further reported that apparel retailer Express (EXPR) is gearing up for a debt restructuring, reflecting the broader turmoil in the retail landscape.