LONDON FOG EXITS CH.11
NEW YORK — London Fog Industries Inc., which ended its fiscal year with a balance sheet in the black, emerged from Chapter 11 bankruptcy court protection on Tuesday.
As reported, the rainwear and outerwear manufacturer filed a voluntary petition for Chapter 11 bankruptcy court protection on Sept. 27, 1999, in Delaware.
William Dragon Jr., president and chief executive officer, said, “We went into Chapter 11 to close and eliminate our unprofitable factory outlet stores, as well as make our balance sheet a little healthier. We are coming out with virtually no long-term operating debt on our balance sheet.”
According to the ceo, the company finished its latest fiscal year, which ended in February, with $2.1 million in income. That’s an improvement from projections earlier in the year — filed with the bankruptcy court in its disclosure statement — in which London Fog had estimated a $3.1 million loss on sales of $169 million.
Court documents said that the company expects $5 million in income on sales of $185.1 million for the year ending in February 2002. For the fiscal year ended in February 2000, London Fog lost $13.5 million on sales of $271.1 million. London Fog has a $90 million exit financing agreement with its senior lender, Congress Financial.
While bankrupt, London Fog shuttered more than 100 full-line and factory outlet stores. Thirty-five factory outlet stores, which are focused on liquidating inventory, remain in operation. Dragon said there are no plans to open either any full-line or additional factory outlet stores.
The London Fog division consists of 50 percent rainwear and 50 percent outerwear, with 60 percent of the label’s business in women’s wear and 40 percent in men’s wear. Pacific Trail, which markets only outerwear, is evenly split between women’s and men’s apparel at 42 percent each, with the balance in children’s wear.