Gap: says existing cash 'may not be sufficient'

(CercleFinance.com) - Gap said on Thursday that it will need to take additional actions to both preserve existing liquidity and seek additional sources of liquidity within the next 12 months, as existing cash "may not be sufficient" to fund its operations.


The US fashion retailer said that it is currently seeking new debt financing or other credit facilities, while deferring capital expenditures, reducing headcount, and cutting expenses.

However, there can be no guarantee that the company will successfully complete these actions, it warned.

As of 1 February, cash, cash equivalents, and short-term investments amounted to 1.7 billion dollars.

Three months later, Gap expects to have between 750 million dollars and 850 million dollars of cash and cash equivalent, including short-term investments.

Most cash has been used for "ordinary" changes in operating assets, and particularly costs relating to store closures, it said.

Copyright (c) 2020 CercleFinance.com. All rights reserved.