Retail Defaults Hit Record High In First Quarter
The number of retailers defaulting on loans hit a record high in the first quarter of 2018, a new report shows, affirming many chains in the sector are still struggling under suffocating debt loads and changing business needs. There were 28 total defaults by corporations in the latest period, Moody’s Investors Service found, compared with 23 defaults during the same period a year ago. Nine of the 28 defaults were by retailers. Many retailers are still grappling with the debt load left behind from the private equity buyout boom several years ago. Meanwhile, all retailers are faced with the expensive task of investing in e-commerce, a business that without the right store footprint can eat into profits. The latest retail defaults’ come from Claire’s Stores, which just filed for Chapter 11 bankruptcy protection last month, and Sears Holdings. The department store recently completed a distressed debt exchange, which Moody’s considers a default. Read more at CNBC.
