Claire’s Stores refinances, repays debt to improve liquidity position

By Devika Patel

Knoxville, Tenn., April 13 – Claire’s Stores Inc. plans to make enhancing its liquidity a priority, as management stated in the third quarter, and has refinanced and retired some of its debt in order to progress this endeavor.

“In order to help create enhanced liquidity, we replaced our HSBC $50 million revolving credit facility with a $50 million secured term loan that will mature in January 2019,” chief executive officer Ron Marshall said on the company’s fourth quarter earnings conference call on Thursday.

“We have retired the remaining $25.8 million in principal of the 10˝[%] senior subordinated notes that would have matured June 1, 2017.”

The company’s global cash balance was $55.8 million at the end of the fourth quarter and it had $64.1 million of borrowing capacity available under its credit facilities.

Adjusted EBITDA in the fiscal 2016 fourth quarter was $76.9 million compared to $80.6 million last year.

Adjusted EBITDA in fiscal 2016 was $188.2 million, compared to $217.3 million in fiscal 2015.

As of Jan. 28, 2017, cash and cash equivalents were $55.8 million. As of Jan. 28, 2017, the company had $6.2 million drawn on its ABL credit facility and an additional $64.1 million of borrowing availability.

Claire’s is a Hoffman Estates, Ill.-based retailer of fashion accessories and jewelry.

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