NEW YORK--The ailing Broadway Stores Inc. is considering various financing options, the company said Friday, as its stock continued to fall on the New York Stock Exchange.
"As we have said before, the company is exploring all alternatives for financing its business," David L. Dworkin, president and chief executive officer, Broadway Stores Inc., said in a statement Friday. "We know of no defaults on our loan agreements, are proceeding with several single store dispositions and this week received the third revised offer on our Southwest stores from an interested party. That offer, like its predecessors, is inadequate."
The statement did not specify other financing options, but rumors of a possible Chapter 11 filing circulated Friday. Broadway officials couldn't be reached Friday to comment on those rumors. The company said it issued the statement in response to its stock decline, but made no reference to a report Friday by TV business commentator Dan Dorfman that the chain may go bankrupt. It said it cannot explain downward pressure on its stock price. On Friday, the chain's stock fell 1/2, or 14.3 percent, to close at a 52-week low of 3 on the New York Stock Exchange. The issue has traded as high as 12 1/4 in the last year.
The statement said the company saw sales growth in July but continued to face margin pressure in its "very competitive markets." Financial analysts noted Broadway had a tough second quarter. Turnaround efforts have been hurt by a heavy debt load, the sluggish California economy, cutbacks in its store remodeling program and stiffer competition.
According to a source in the credit community, goods were still being shipped to Broadway Friday, but the flow has slowed.

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