American Apparel, Quo Vadis?

Having avoided the bankruptcy for the umpteenth time, facing the biggest challenge ever to cope with its tumbling finance and border lining pornographic advertising as every chance they got. American Apparel is yet giving it another try with the

appointment of John Luttrell as its CFO.
 
As reported within US markets, American Apparel’s titles rose 4.3% after appointing former Old Navy chief financial officer John Luttrell as its Chief Financial Officer, and just two days the company announced it had obtained a waiver from its lenders allowing it to avoid bankruptcy.
 
Main lenders, Lion and Bank of America, relaxed their credit agreement with CEO Dov Charney  because the alternative was to demand their combined $121.5 million in debt be paid immediately, which American Apparel cannot do. That would mean Lion and BofA would have to sell or liquidate the company, and it would be accepting cents on the dollars they’re owned.
 
This movement is framed within the company’s plan to bring in more executives to the retailer and came after American Apparel last year received a subpoena from the U.S. Attorney's Office in New York, as well as inquiries from the Securities and Exchange Commission, over the resignation of its auditors. Deloitte quit in July as the company's auditors after warning of problems with American Apparel's financial reporting. The company also received a letter from the New York Stock Exchange last year saying a timely filing of the company's second-quarter 10-Q report was a condition for continued listing on the exchange. It finally filed its 10-Q in November, after also delaying its first-quarter report.
 
Amid those problems, Luttrell is succeeding Adrian Kowalewski, who was named executive vice president of corporate strategy. Chief Executive Dov Charney touted Kowalewski's contributions during a transitional period in the depths of the credit crunch in late 2008. Kowalewski, who joined the company in 2006, will remain on its board.
Luttrell said "without question the company has undergone some unprecedented challenges that have impaired its recent financial performance." He said his challenge would be to cut costs, while providing a platform for American Apparel to build sales growth.
 
According to diverse analysts, Luttrell’s main job will be to squeeze AA’s expenses, given the fact that the retailer has been in financial trouble since 2009.
 
Despite all the company’s effort for getting back to track, CEO Dov Charney decided to celebrate Luttrell’s appointment by publishing another ad featuring a picture originally published in an old porno magazine.