free web tracker

Le Chateau says it might shut down all stores within the year

Canadian fashion staple Le Chateau is apparently not in a great place financially and in danger of shutting down all stores and going out of business, the company said yesterday.

The Montreal brand issued a statement yesterday that outlined some of the issues it’s facing in as a result of financial difficulties made worse by the pandemic shutdown.

It said that sales for the fourth quarter that ended in January amounted to $48 million, as compared with $51.4 million for the same quarter last year. This meant “a decrease of 6.5 per cent, with 10 fewer stores in operation,” it said.

It says that it’s currently in the process of “negotiating its financing requirements with its existing lenders and is in discussions with its landlords” while looking for other sources of financial assistance as both online and in-store sales a saw decrease during the same period last year.

It noted pre-existing concerns of the company’s financial health and said the pandemic outbreak “is having significant impacts for the company” with its only revenue coming from online sales.

While beginning to reopen stores, the company is now worried about what the rest year will hold and say the future will be “dependent on its ability to obtain necessary financing.”

As it looks for other sources of revenue, it recently announced that it will be manufacturing more than 500,000 hospital gowns for health care workers.

The retail industry was one of the hardest hit during the pandemic, with major brands like J.Crew filing for bankruptcy and Victoria’s Secret closing its stores.

Le Chateau has 129 stores across eight Canadian provinces and says that it does not expect to fully resume normal operations until 2022.

Check Also

Canada’s economy growing twice as fast as U.S. due to better COVID-19 response

Canadians have a lot to be proud of when it comes to our COVID-19 response.  Not …