The Wall Street Journal reported Friday that San Jose, Calif.-based Orchard Supply Hardware hired restructuring lawyers as it strives to improve its balance sheet.
The California hardware and lawn and garden retailer has about 90 stores that average in size at about 44,000 sq. ft., plus 8,000 sq. ft. of exterior nursery and garden space. The company was founded as a purchasing cooperative in San Jose in 1931.
In the company’s most recent quarterly report, it posted a net loss in the third quarter of fiscal 2012 of $53.6 million compared with a net loss of $10.1 million in the third quarter of fiscal 2011.
At the time, Orchard Supply CEO Mark Baker said: "At the beginning of fiscal 2012, we outlined five strategic priorities, which included our plans to transform Orchard's store portfolio to our productive new neighborhood format. Thus far in 2012, we opened two new stores and remodeled four existing locations, three of which were completed during the third quarter, and we're seeing increased customer traffic and engagement at those locations. While comparable-store sales were flat in the third quarter, the combination of stronger sales of seasonal merchandise and contributions from the newly remodeled stores drove an improvement in comp store trends throughout the period. However, our margins were pressured as we increased our promotional activity to help drive traffic and sales."