According to a recent media report in the Wall Street Journal, Stage Stores is preparing for a financial restructuring that could include a bankruptcy filing.
The potential filing comes as the retailer has continued to convert its department store banners into Gordmans off-price retail outlets, and as the discount retailer contends with losses at its department stores, according to the report.
The report also indicated that the department store operator has been late in paying vendors amid a cash crunch.
Stage Stores operates about 728 stores in 42 states under several brands including Bealls, Goody’s, Palais Royal, Peebles, Stage and Gordmans. But the retailer over the last year has undergone a shift in strategy and has been converting its stores to an off-price format.
According to the company, based on the success of the conversion strategy, the company said it would begin converting its remaining department stores in February of 2020. It expects to be operating approximately 700 small-market Gordmans off-price stores by the third quarter.
For the nine-week holiday period ended January 4, 2020, Stage Stores said its comparable sales increased 1.4% as compared to the nine-week period ended January 5, 2019.
Michael Glazer, president and CEO, Stage Stores, said at the time, “While our positive comparable sales for the holidays did not meet expectations, we remain confident that our off-price strategy will lead to profitable growth in the future.”