Troubled clothing firm American Apparel has been given another two months to file its second-quarter results after US regulators accepted its updated plan of compliance to avoid being delisted from the New York Stock Exchange.
The Los Angeles based manufacturer and retailer was warned in August that it faced being delisted after failing to file its quarterly report on time.
American Apparel on Friday (17 September) said the exchange had given it until 15 November to regain compliance with its continued listing standards. It will also be subjected to periodic reviews by the exchange during the extension period.
The firm earlier blamed the filing delay on the resignation of its auditor Deloitte & Touche and said it needed extra time for its new auditors to complete their review. It has also faced a number of class action lawsuits linked to allegations of mismanagement and misrepresentation of the company’s finances.
Preliminary figures for the company’s delayed second quarter results released in mid-August suggest a steep fall in retail sales, leading to a loss of several million dollars and increased debts.
That led American Apparel to raise doubts about its future viability, adding that it needed urgently to renegotiate its credit terms before a potential debt default at the end of September.
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By GlobalData
