American Apparel Faces Bankruptcy, Dov Charney Speaks
Hipster clothier American Apparel is on its way to bankruptcy, WWD reports. American Apparel, Inc. announced that both weak business and loans "raise substantial doubt that the company will be able to continue as a going concern" and that "the company may not have sufficient liquidity necessary to sustain operations for the next twelve months."
American Apparel's second-quarter losses will be somewhere between $5 million and $7 million after a terrible first quarter. According to the New York Times, shares in American Apparel have fallen more than 66 percent over the last year and that overall, the company has more than $91 million in debt. The SEC is threatening to de-list American Apparel from the stock exchange if it doesn't file its quarterly reports by Tuesday. Jezebel got in touch with CEO Dov Charney Tuesday afternoon to see if the results were filed and he responded, "I couldn't tell you."
Charney also spoke with BusinessWeek.com at the beginning of the month. He said, "A lot of assumptions that I grew up with are no longer reality. Those were things that we could rely on: that lenders will always be there, that they'll behave ethically and they'll always have money, that you can trust that as the sun comes up the consumer will be healthy, that we'll always be close to full employment in developed nations. Now there are no certainties."
In any case, Charney--and American Apparel--are moving away from "hipsterdom." He spoke with the Village Voice, remarking, "Hipsters are from a certain time period. The stereotype of a hipster is not something people aspire to anymore. Do you want to be a hipster? Nobody wants to be a hipster." The company is moving toward a preppy aesthetic, Charney said, explaining, "It's hard to put into words--it's about emphasizing products that we have. Our pieces are timeless."
Read more from the AP.