LNT: To ship or not to ship
May 14, 2008-- Home Textiles Today,
Clifton, N.J. —Linens ’n Things is reporting that vendors have begun shipping two weeks after its Chapter 11 bankruptcy, and a day after the company told the Securities and Exchange Commission its quarterly financial report would be delayed.
“A significant number of vendors are shipping on terms,” offered LNT spokesman Susan Boyle-Kenney this afternoon in response to an inquiry by Home Textiles Today.
However, Boyle-Kenney could not say how many companies were shipping or which ones. In calls to several of the company’s suppliers over the past several days, HTT was unable to find one that had actually resumed deliveries on terms, although several said they hoped or expected to resume shipments within the next week or so.
At the same time, there were mixed reports concerning the guidance being offered by a major factor and a credit insurer. One was reportedly advising clients to wait, pending LNT’s filing of the delayed quarterly report. The other was reportedly preparing to write limited credit insurance.
“We hope to begin shipping them under limited terms within the next week,” said Sy Sadinoff, ceo of Beacon Looms. He said terms of 15 days net were being suggested by LNT, ostensibly across its vendor base.
[Clarification:Beacon Looms ceo Sy Sadinoff clarified that terms of 15 days net were suggested by Linens 'n Things for several specific rush orders and not across its vendor base as he originally understood.]
LNT did report limited results yesterday for the first quarter: $566.9 million in sales, a 0.8% decrease over the prior and a comp store decline of 5.7% for the quarter. The company said it would not hold a first quarter conference call. It reported that at the close of business on May 11, 2008, it had total liquidity in excess of $100 million.
In the meantime, 14 objections involving 35 entities have been filed in advance of a bankruptcy court hearing scheduled for Friday, May 16 on LNT’s auction procedures, agency agreement and store closing sales and related events. Most of the objections are being raised by real estate interests, but also include the company’s Noteholders Committee, CBL & Associates Management and the states of Texas and Tennessee.
The hearing is scheduled for noon Friday at the federal bankruptcy court in Wilmington, Del.