Immense Impact of COVID-19 Forced Prolonged Closure of Entire Store Portfolio, Creating an Insurmountable Financial Hurdle
Company Voluntarily Files for Protection under Chapter 11 to Reduce Outstanding Liabilities,
Company Secures Commitment for
Over 80% of Stores Have Re-Opened to Date; Additional Locations Will Continue to Open as State and Local Mandates Allow
Company Has Delivered Positive Comparable Store Sales at Re-Opened Stores; Over 7,300 Associates Have Returned to Work
To pursue this reorganization, Tuesday Morning filed voluntary petitions for protection under Chapter 11 of the Bankruptcy Code in the
To enable the Company to continue operations during the reorganization process, the Company has obtained a commitment from its existing lender group to provide
Following the closure of the entire store portfolio as a result of COVID-19, Tuesday Morning has re-opened over 80% of its existing store footprint to date and expects to continue store re-openings and bringing associates back to work over the coming weeks.
Realignment of Store & Distribution Footprint
The Company expects the reorganization process to enable the Company to realign its store footprint. Following a thorough and comprehensive store-by-store analysis with the help of its financial and restructuring advisors, the Company expects to close approximately 230 of its 687 stores to focus on high-performing locations and will do this with a phased approach. The store closure process will take place over the summer. The Company has requested bankruptcy court approval to close at least 132 locations in a first phase and, eventually, the Company’s distribution center in
Tuesday Morning plans to attempt to renegotiate a significant number of leases during this process. Of the remaining 555 stores, the Company plans to exit approximately 100 additional locations leaving a go-forward footprint of approximately 450 stores.
This realignment will allow Tuesday Morning to improve its product offering by focusing on the highest performing stores in its most productive markets, provide greater value to customers by sending the best deals to a smaller number of stores, and enhance the overall profitability and credit worthiness of the Company with resources directed at its most profitable stores.
The Chapter 11 process is not expected to impact the Company’s ability to re-open stores closed due to COVID-19 and it will continue to do so in accordance with state and local mandates where the Company operates.
Since Tuesday Morning began re-opening its stores on
The Company’s highest priority continues to be the health and safety of its customers and employees. Tuesday Morning has put in place a number of safety measures at each newly re-opened location, including the implementation of enhanced cleaning protocols and social distancing at all times. Additionally, employees have completed training on safety procedures and are required to wear masks.
Court filings and other documents related to the court-supervised process are available at https://dm.epiq11.com/TuesdayMorning, or by calling the Company’s claims agent,
About Tuesday Morning
Cautionary Statement Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws, which are based on management’s current expectations, estimates and projections. Forward looking statements also include statements regarding the Company’s plans with respect to the Chapter 11 proceedings, the Company’s plan to continue its operations while it works to complete the its proposed reorganization, the Company’s proposed debtor-in-possession financing, the Company’s plans to reopen stores, the Company’s plans for store closures and lease renegotiations, and other statements regarding the Company’s proposed reorganization, strategy, future operations, performance and prospects. These forward-looking statements are subject to risks and uncertainties that could cause the Company’s actual results to differ materially from the expectations expressed in the Company’s forward-looking statements. These risks, uncertainties and events also include, but are not limited to, the following: the Company’s ability to obtain timely approval of the
Source: Tuesday Morning Corp.