How the mighty have fallen. Blockbuster’s Q2 numbers are out, and they’re even grimmer than Wall Street expected, with revenue declining 20 percent to $788 million. BB’s net losses also increased to $69 million. Blockbuster’s only positive news, if you want to call it that, is that it was able to receive yet another debt reprieve from its creditors. BB’s massive debt repayment of $42 million, out of a total debt burden of nearly $1 billion, is now due at the end of September.
Fast becoming a master of spin without peer, BB CEO Jim Keyes offered the following on the latest forbearance agreement:
“While making progress, this extension allows additional time to complete these complex, multiparty negotiations . . . To take advantage of its unique multi-channel model and revitalize its global brand, Blockbuster will require an improved capital structure. Our objective is to complete a recapitalization as soon as possible so we are better positioned to focus our attention and resources on the strategic opportunities to continue our business transformation.”
Six weeks from now, is Blockbuster going to be in any kind of situation where it will be able to make its debt payment? How many more lifelines will BB be tossed by its creditors? Will Chapter 11 be in the cards before the next deadline hits?
(via The Wrap)