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πŸ‘•New Chapter 11 Bankruptcy Filing - iMedia Brands Inc. ($IMBI)πŸ‘•
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πŸ‘•New Chapter 11 Bankruptcy Filing - iMedia Brands Inc. ($IMBI)πŸ‘•

Media commerce business seeks sale in bankruptcy.

Jun 29, 2023
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PETITION
PETITION
πŸ‘•New Chapter 11 Bankruptcy Filing - iMedia Brands Inc. ($IMBI)πŸ‘•
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Source: iMedia Brands Inc.

β€œCash is critical to the Debtors’ business enterprise, which consists of a broad-based portfolio of entertainment, consumer brands, and media commerce services businesses.” β€” James Alt, Chief Transformation Officer of iMedia Brands Inc.

You don’t say.

On June 28, 2023, MN-based and publicly-traded iMedia Brands Inc. ($IMBI) and 11 affiliates (together, the β€œdebtors”) filed chapter 11 bankruptcy cases in the District of Delaware (Judge Owens).

This company is about as hodge-podgey a hodgepodge as you can find. The debtors consist of a portfolio of entertainment (Shop HQ, a shopping network + 1-2-3.tv, a non-debtor German interactive media company), consumer brands (Christopher & Banks and J.W. Hulme Company), and media commerce businesses (iMedia Digital Services),1 β€œβ€¦each of which cross promotes and exchanges data with each other to optimize the engagement experiences it creates for advertisers and consumers in the United States and Western Europe.”

  • The entertainment segment is the alleged crown jewel; it generates nearly 84% of the company’s total revenue, which, to be fair, wasn’t a shabby amount. In FY’22, the company’s consolidated net sales for the segment were $455.7mm. Not bad! Unfortunately, that represented a $23.2mm ⬇️ from FY’21. Bad! Even worse, the segment suffered an operating loss of $101.9mm in FY’22, a cliff dive compared to a more modest $13.5mm loss in FY’21.

  • The consumer brands segment is much smaller than the entertainment and while its FY’22 sales represented a ⬇️ of $1.6mm from FY’21, it generated $8.8mm of operating income in FY’22, a big increase off of $2.6mm in FY’21. Must be the power of the Christopher & Banks acquisition out of its β€˜21-vintage bankruptcy2 plus the β€œiconic” status of J.W. Hulme Company (like huh?, lol)!

  • Finally, the iMedia Digital Services segment constitutes a digital advertising platform that engages shopping enthusiasts online and in over-the-top marketplaces like on Roku, Fire TV, Apple TV, and other venues. This segment is the company’s highest (sales) growth segment with $46.2mm in sales in FY’22 vs. $27.8m in FY’21. Operating income was $4.9mm against $2.6mm in FY’21.

So, napkin math: ($101.9mm) + $8.8mm + $4.9mm = (πŸ’©).

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