From Co. Filing:
Francesca’s Holdings Corporation (the “Company”) has adopted a plan to close approximately 140 boutiques by January 30, 2021. The actual number of boutiques the Company closes may change. In connection with these boutique closures, the Company expects to incur total impairment charges of approximately $29.0 million to $33.0 million during the thirteen and thirty-nine weeks ended October 31, 2020. The estimate of total charges to be incurred may vary based on various factors, including the actual timing of the boutique closures, the outcome of negotiations with third parties and changes in management assumptions. The non-cash impairment charges are not expected to result in cash expenditures.
As previously disclosed, the Company is evaluating various alternatives to improve its liquidity and financial position, including but not limited to, further lease concessions and deferrals, further reductions of operating and capital expenditures, raising additional capital, including seeking a refinancing of the Company’s debt, and restructuring its debt and liabilities through a private restructuring or a restructuring under the protection of applicable bankruptcy laws. However, there can be no assurance that the Company will be able improve its financial position and liquidity, complete a refinancing, raise additional capital or successfully restructure its indebtedness and liabilities. If the Company is unable to raise sufficient additional capital to continue to fund operations and pay its obligations, the Company will likely need to seek a restructuring under the protection of applicable bankruptcy laws. The Company’s strategic plans are not yet finalized and are subject to numerous uncertainties, including negotiations with creditors and investors and conditions in the credit and capital markets.