• Q2 net loss narrows to $16.2m
  • Gross margin narrows to 50.7%
  • Net sales remain flat
American Apparel said it expects to enter into a credit agreement “as soon as practicable”

American Apparel said it expects to enter into a credit agreement “as soon as practicable”

American Apparel has said it expects to enter into a credit agreement "as soon as practicable" as it revealed a narrowing of its net losses in the second quarter.

In the three months to the end of June, net losses amounted to US$16.2m. This compared to a loss of $37.5m for the 2013 period.

Gross margin, however, narrowed to 50.7% in the quarter from 51.7%, due to a shift in the sales mix from retail and online sales to lower margin wholesale net sales.

Net sales remained flat at $162.4m on a 6% drop in retail comparable store sales and a 9% increase in wholesale net sales.

The company said it now estimates adjusted EBITDA will be in a range of $40m to $45m for the year.

In addition, American Apparel said it is in the process of negotiating an unsecured credit agreement with between one or more entities affiliated with Standard General and one or more foreign subsidiaries of the company as borrowers. It expects to enter into this credit agreement "as soon as practicable", it said.