iMedia Brands Q4 Results Miss Street View On Liquidity Challenges, Content Distribution Issues

iMedia Brands Inc IMBI reported a fourth-quarter FY22 sales decline of 31.1% year on year, to $133.5 million, missing the analyst consensus of $171 million.
The company attributed the revenue decline to an unexpected liquidity challenge. In addition, an estimated $10 million negative net sales impact was driven by ShopHQ Networks' proactive content distribution disruptions.
The gross margin fell 150 basis points Y/Y to 36.8%.
The company recorded an operating loss of $(15.3) million for the quarter, wider than the operating loss of $(0.3) million in the year-ago period.
As of Jan. 28, 2023, total unrestricted cash was $7.2 million, compared to $11.3 million as of the year-ago period.
The company's adjusted EBITDA of $2.5 million decreased 84% year over year from $15.1 million. The unexpected liquidity challenge and proactive content distribution disruptions were the primary drivers of the $13 million decrease.
Loss per share was $(0.82) versus the loss of $(0.27) last year and missed the analyst consensus of $(0.13) loss.
On Apr. 10, 2023, the company completed its debt reduction event, which reduced its debt by $53 million to approximately $123 million.
Outlook: The company anticipates Q1 net sales at $105 million, a 31% year-over-year decline, dragged by the Q4 liquidity challenge.
The company anticipates Q1 net income to be driven primarily by several one-time gains related to the debt reduction event.
The company expects Q1 Adjusted EBITDA to be approximately $1 million.
The company is in the process of engaging a national investment bank to lead an RFP process to replace its senior lenders as quickly as practical.
Price Action: IMBI shares are trading lower by 25.29% at $0.39 on the last check Wednesday.

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iMedia Brands Q4 Results Miss Street View On Liquidity Challenges, Content Distribution Issues