Home appliance and electronics retailer hhgregg may be nearing a bankruptcy filing as the company continues to struggle with a prolonged period of declining sales.
The news of a possible Chapter 11 filing, first reported by Bloomberg, comes a week after company officials said it engaged with Stifel, Nicolaus & Co. and Miller Buckfire & Co., subsidiaries of Stifel Financial Corp., to pursue a range of potential strategic and financial transactions to improve liquidity and return to profitability.
Robert Riesbeck, hhgregg’s president and CEO, previously said the company is committed to improving results through its business strategy, including investments made to shift its focus to appliances and furniture, and additional expected cost reductions.
“We believe it is an appropriate time to explore potential strategic transactions,” he said. “As the company undertakes this exploration process, we are focused on the execution of our business strategy and remain fully committed to serving our customers’ needs.”
In late January, hhgregg reported a third quarter net sales decrease of 23.7% to $453 million. Comparable store sales were down 22.2%. Net loss per share was $2.10 and gross margin decreased to 22%. The quarter includes sales from the 2016 holiday season.
