Crabtree & Evelyn Files For Bankruptcy
July 2, 2009
Crabtree & Evelyn has filed for bankruptcy, citing debt pressures and the decline in consumer spending as reasons behind its Chapter 11 filing in New York.
The Woodstock, Conn.-based personal care products seller listed $10 million to $50 million for both its assets and liabilities in its bankruptcy declaration on Wednesday.
Crabtree & Evelyn, a 950-employee company operating 126 retail locations in 34 U.S. states, generated $107.5 million in sales in fiscal 2008. However, it also posted an $8 million operating loss in the same period, according to its Chapter 11 document.
The company derives its name from the surname of 17th century Englishman John Evelyn and Britain's native arboreal crabtree. It sells a diverse range of soaps, fragrances and food products in its own stores, as well as on its Web site and in gift shops like Hallmark.
Crabtree & Evelyn opened its first retail store in 1977, after being established in 1973 in Cambridge, Mass. Its retail operations comprise 56% of the business' sales, which are expected to total $100 million in fiscal 2009. However, the company also expects to post a $13.3 million operating loss, following several years of consecutive operating losses.
Stephen Bestwick, president of Crabtree & Evelyn since April 2009, plans to close certain retail locations in order to cut costs.
The company's five largest unsecured creditors are Standard Soap, Michael Stromberg, Vera Bradley Designs, Alpha Logic and Seaweed Survival.
Judge Burton Lifland is overseeing the case, filed under number 09-14267.
Law firm Cooley Godward Kronish attorney Lawrence Gottlieb is representing Crabtree & Evelyn, which is also relying on Clear Thinking Group for financial counsel and KPMG Corporate Finance for real estate advice. Epiq Bankruptcy Solutions is serving as claims agent.
According to its court filing, the retailer is owned by a series of entities that include parent company Crabtree & Evelyn Holdings of London.
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