American Apparel might be no more, people.
The clothing outlet has released a statement that suggests it could be the end for the brand within the year.
‘We believe that we may not have sufficient liquidity necessary to sustain operations for the next twelve months,’ read a release from American Apparel after it failed to meet a scheduled debt payment to one of its major lenders on Monday.
‘These factors, among others, raise substantial doubt that we may be able to continue as a going concern.’
The brand has also announced its plans to extend its credit from $50 million to $90 million, despite expecting losses for the rest of 2015. So basically, the company is near bankruptcy. Not good.
On top of this, the LA-based clothing label has admitted that sales were down 17% in the last quarter due to multiple store closures.
‘The decline in comparable sales was attributable to the lack of new style introduction for the spring and summer selling season’, it added in its press release.
Investors have also lost interest in the brand, and stock is down more than 86.8% over the past year.
It doesn’t help that the brand has been plagued with controversy over the years.
As well as founder and CEO Dov Charney being sued for sexual harassment and then fired by his own company, numerous American Apparel ads have been banned for being too overtly sexualised.
Could this be the end for our favourite tights, socks and crop top stockists? Watch this space.