Express’ CEO Shares Strategy Amid Sales Slump and Debt It Battle’s Bankruptcy

In the world of retail, traditional stores face the looming threat of bankruptcy. While many blame online giants like Amazon for this decline, recent data from the U.S. Census Bureau tells a different story. As of the last quarter of 2023, online sales only made up 15.6% of total retail sales. This significant but not dominant figure shows that physical stores remain crucial.

The Census Bureau reported, “E-commerce sales in the fourth quarter of 2023 represented 15.6% of total sales, marking a 7.5% increase from the same period in 2022. Meanwhile, total retail sales increased by 2.8% in the same timeframe.”

Contrary to popular belief, a report from sheds light on the actual foot traffic in retail spaces. Their ‘Comeback of the Mall in 2024’ report reveals that visits to shopping malls are almost back to pre-pandemic levels.

Express Retail
Rapid Ratings flags Express as a high default risk and advises stakeholders on risk mitigation strategies. (Credits: Mike Mozart/Flickr)

Indoor malls saw only a slight 5.8% decrease in foot traffic compared to 2019. Moreover, open-air shopping centers performed even better, indicating a steady recovery across various retail environments.

“Shopping mall foot traffic is approaching pre-pandemic levels, with indoor malls experiencing a 5.8% decrease compared to 2019. This marks a significant improvement from the over 15% drop seen in 2021,” shared

Financial Struggles of Express: Declining Cash Reserves

Express (EXPR) faces tough times amid challenges in the retail industry. Despite a slight improvement from last year, the company reported a net loss of $36.8 million in its third fiscal quarter.

The situation is serious with almost $500 million in inventory but only $34.6 million in cash. Rapid Ratings has flagged Express as a “high default risk,” urging stakeholders to take action to minimize risks.

Can Express Bounce Back?

Stores are struggling with sales, inside the fight to avoid bankruptcy and boost store sales¬† “Express is cutting expenses to save money,” Rapid Ratings said.

Stewart Glendinning CEO of Express Retail
New CEO Stewart Glendinning admits sales shortfall, heavy discounts hurt margins, hints at store closures. (Credits: Fashion Network)

In response, Express is cutting costs aggressively, aiming to save over $200 million every year by 2025. They’re reviewing their business model to find ways to operate more efficiently and avoid financial trouble.

However, despite these efforts, the risk of default remains high. Express’s stock has been delisted from the New York Stock Exchange and is now traded on the OTC Pink Sheets, showing a significant decline in its market presence since its peak.

Express’s Potential Chapter 11 Bankruptcy: Weathering the Storm

Express is considering a Chapter 11 bankruptcy filing as it works with lenders to secure funds for a restructuring plan.

Stock delisted from NYSE, now traded on OTC Pink Sheets, indicating a decline in market presence. (Credits: Antique Stocks)

The company, with both physical stores and online platforms, is dealing with around $300 million in debt and expects significant losses for the year.

Stewart Glendinning, who became CEO in August 2023, has been upfront about the challenges. Sales have been lower than expected due to heavy competition and the necessity for big discounts to sell inventory, which has hurt profits.

Glendinning acknowledges the need for better operations altogether, hinting at possible store closures as part of a broader plan to improve.

Sajda Parveen
Sajda Parveen
Sajda Praveen is a market expert. She has over 6 years of experience in the field and she shares her expertise with readers. You can reach out to her at [email protected]
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