Online florist FTD, No. 138 in the Internet Retailer Top 1000, is going to need a little TLC to survive this summer. The retailer, which operates brands including ProFlowers and gift retailer Shari’s Berries, wrote Monday in a U.S. Securities and Exchange Commission filing that it may run out of funds to continue to operate its business as soon as July.
“[We] will have sufficient liquidity to fund our operations into July 2019 but may not have sufficient liquidity to fund our operations beyond then,” the retailer says in the filing. FTD says it needs to refinance or repay its $217.7 million worth of debt by September 19 and that it may not be able to.
“In the financial statements for the year ended December 31, 2017 as well as every quarter since, management’s assessment has been that there is substantial doubt about the company’s ability to continue as a going concern,” FTD says.
The company says it is looking into “strategic alternatives” to address its debt, including a sale or merger or additional funding. FTD also announced a corporate restructuring and cost-savings plan “to optimize operations, drive efficiency, and reduce costs.”
FTD, which has been delivering flowers since 1910, said its 2018 sales fell 6% to $1.01 billion from $1.08 billion a year earlier. It also posted a loss of $224.7 million for 2018.
Top 1000 retailers in the flowers category—which includes retailers of flowers and plants as well as chocolates, popcorn, fruits and candy—posted a five-year online compound annual growth rate of 21.0% compared with 27.64% for the Internet Retailer 1000 as a whole. The three largest Top 1000 retailers in the category include 1-800Flowers.com, FTD and From You Flowers LLC.
The flower category posts a high average conversion rate of just under 13% compared with the Top 1000 average at just over 3%, as many flowers and gift shoppers are on a tight deadline to purchase a present for a special event and intend to buy, not browse when they visit a flower or gift retail site.
Large floral retailers including 1-800-Flowers and FTD, have focused on diversification in recent years. Additions to their portfolios include candy, cookies, chocolate, popcorn and personalized products. In 2014, FTD bought Provide Commerce for $430 million. Provide Commerce’s floral and gifting portfolio included flower retailer ProFlowers, Shari’s Berries and personalization retailer Personal Creations.
Lauren Freedman contributed to this articleFavorite