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Sequential Brands Group has faced significant compliance issues with Nasdaq due to its failure to file required Quarterly Reports for periods ending March 31 and June 30, 2021. On August 31, 2021, the company filed for voluntary Chapter 11 bankruptcy in Delaware, further exacerbating its non-compliance status. Nasdaq has notified the company that, as a result of these issues, trading of its common stock will be suspended on September 9, 2021. A Form 25-NSE will also be filed to remove its securities from Nasdaq listing.
Sequential Brands Group (NASDAQ:SQBG) has voluntarily filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for Delaware, due to significant debt hindering its operations. The company aims to sell its assets under Section 363 of the Bankruptcy Code, seeking court approval for bidding procedures to maximize asset value. It has secured $150 million in debtor-in-possession financing from its Term B Lenders, ensuring liquidity during the sale. Sequential is also pursuing motions to maintain employee wages and benefits throughout the process.
Sequential Brands Group (Nasdaq: SQBG) has finalized the sale of its Heelys brand to BBC International for $11 million. This decision is part of the company's broader strategic review process, which is ongoing. The Heelys brand was originally acquired in 2013 for about $5.5 million. The proceeds from this transaction will primarily be used to reduce debt, enhancing the company's financial position.
Sequential Brands Group (SQBG) reported Q4 2020 revenue of $23.0 million, down from $24.2 million year-over-year. The company's GAAP loss from continuing operations was $4.4 million or $2.65 per diluted share, an improvement from a loss of $7.9 million in Q4 2019. Full-year revenue dropped to $89.8 million from $101.6 million in 2019, with a net loss of $88.1 million. Adjusted EBITDA for Q4 2020 was $13.2 million, significantly up from $8.0 million a year prior. Due to COVID-19, retail operations faced uncertainty, impacting sales and financial performance.
AND1, owned by Sequential Brands Group (Nasdaq: SQBG), has signed Toronto Raptors player Norman Powell. This partnership aims to rejuvenate AND1's presence in the North American basketball market, utilizing Powell's athleticism and popularity to enhance brand recognition through various social and digital campaigns. Powell expressed excitement about representing the brand, highlighting its historical significance in streetball culture. The collaboration is set to launch with the exclusive release of Powell's Attack 2.0 footwear in Foot Locker Canada this fall.
Sequential Brands Group (Nasdaq:SQBG) has announced new partnerships with Omega Apparel and Millennial Apparel Group to expand its William Rast denim line. The collaboration aims to create fresh collections for both men's and women's denim, set to launch later this year. With a focus on high-quality design and premium fit, the brand seeks to enhance its market presence and distribution channels. Executives from both partner companies expressed optimism about growing the William Rast brand into a sustainable fashion leader.
The Rosen Law Firm is investigating potential securities claims on behalf of Sequential Brands Group, Inc. (SQBG) shareholders due to allegations of issuing misleading business information. On December 11, 2020, the SEC charged Sequential for failing to timely impair goodwill, which reportedly inflated operational income and misrepresented financial condition. This news caused a significant drop in Sequential's stock price on the same day. The law firm is preparing a securities lawsuit for affected investors.
The law firm Federman & Sherwood is investigating Sequential Brands Group (NASDAQ: SQBG) for potential violations of federal securities laws. The inquiry centers on disclosures made by Sequential, particularly regarding possible breaches of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. Previously, the SEC charged Sequential with misleading investors by not timely impairing goodwill, which led to inflated income and misrepresented financial statements. Following this news, SQBG's stock fell sharply on December 11, 2020.
Sequential Brands Group (NASDAQ:SQBG) has announced a renewed exploration of strategic alternatives to maximize shareholder value. The Board of Directors considers options such as a potential sale of the company or divesting certain brands. Stifel serves as the exclusive financial advisor for this process. The Executive Chairman, William Sweedler, indicated that the company has improved its cost structure and stakeholder relationships, making this the right time to pursue these strategic alternatives.
Sequential Brands Group (SQBG) reported third-quarter 2020 results, with total revenue of $24.0 million, down from $25.4 million year-over-year. The Company achieved GAAP income of $4.5 million, a significant improvement from a loss of $18.4 million in Q3 2019. Notably, $3.7 million gained from selling non-core brands contributed to this income. However, the Company faces challenges with a year-to-date loss of $(83.8) million due to $85.6 million in impairment charges. As of September 30, 2020, cash stood at $22.2 million, amid concerns of non-compliance with upcoming loan covenants due to COVID-19 impacts.
