Hancock Fabrics secures $110mn credit facility from Wachovia Bank
03 Jun '05
2 min read
Leading specialty fabric merchandiser Hancock Fabrics Inc reported the sales in the four-week period ended May 28, 2005 totaled $25.9 million compared with $28.0 million in the same period of the prior year.
Sales in comparable stores declined 8.4% in May. In the first four months of fiscal 2005, total sales were $123.7 million versus $133.1 million a year ago, and comparable store sales declined 7.2%.
In commenting on the sales results, Jane Aggers, Chief Executive Officer, stated, "They are disappointed with May's results, however, they are continuing to take the steps needed to implement our plan to remerchandise our product assortments and presentation in the stores and improve our marketing prior to the Fall season."
Hancock also announced that it has entered into an agreement with Wachovia Bank, National Association, and Wachovia Capital Markets, LLC (together, "Wachovia"), whereby Wachovia has committed to use its best efforts to arrange for and syndicate a secured revolving loan and letter of credit facility for Hancock of up to $110 million.
This new facility, which will replace Hancock's existing unsecured $50 million credit agreement, is expected to be completed within the next four to six weeks. It will have substantially less restrictive operating covenants and the interest rate will be only slightly higher than Hancock's current rate.
In commenting on the announcement, Ms. Aggers stated, "The new credit arrangement, once completed, will provide us with a significant amount of financial flexibility as we move forward over the next few months to implement our merchandising and marketing plans. By moving to a secured credit facility that utilizes the strength of our balance sheet, we will have the necessary capital available to focus on improving our operating performance."
marketing@alchempro.com
