Active Filing for Bankruptcy
I think that by now, you have heard that Active filed for bankruptcy. Here is part of an article from Shop-Eat-Surf.com
“Active is projected to record a $7.7 million loss for the fiscal year ending March 31. […] Also of note is the list of Active’s 20 largest unsecured creditors, which reads like a Who’s Who of action sports brands. Active owes a total of $8.8 million to its 20 largest unsecured creditors.
Interestingly, only one brand is on the list of secured creditors – the Burton Corporation. Secured creditors get payment priority in a bankruptcy.
According to the bankruptcy filing, Active’s revenues stayed approximately the same over the last few years while the number of stores essentially doubled in that same period.
3/31/07: $58.9 million
3/31/08: $61.8 million
3/31/09: $59.9 million (projected)
Annual net income (loss)
3/31/08: ($2 million)
3/31/09: ($7.7 million) projected
The filing says, “These losses have been caused primarily by the Debtor’s rapid over-expansion and market saturation, during which time the company’s same store sales were decreasing substantially.” […]
Leases and contracts
The company is moving to reject eight leases for the stores it has already closed in Irvine, San Diego (three), Simi Valley, Westwood, Lake Elsinore and Mission Viejo.
The filing also says it will reject contracts with several skateboarders, including Andrew Reynolds, Kenny Anderson, Billy Marks, Erik Ellington, Daewong Song, Steve Berra, Eric Koston, Michael Capaldi, Braydon Szafranski and Jim Greco.
In addition, Active is rejecting an operating agreement with ESPN for an e-commerce partnership.”