Liquidation World Inc.
TSX : LQW

Liquidation World Inc.

May 02, 2011 08:30 ET

Liquidation World Inc. Provides Status Update

BRANTFORD, ONTARIO--(Marketwire - May 2, 2011) - Liquidation World Inc. (TSX:LQW), Canada's largest operator of closeout discount stores, made a series of announcements today:

The Company expects to release financial results for its second fiscal quarter ending March 31, 2011 by May 18th, 2011. Estimated revenues are expected to be approximately $30.0 million for the quarter.

The Company previously announced that it has commenced a review of its strategic alternatives with the objective of enhancing shareholder value and has retained RBC Capital Markets as its financial advisor. These options may include additional financings, strategic partnerships and M & A opportunities, including acquisition and divestiture transactions, however there is no assurance that these efforts will result in any transaction.

In addition to working with RBC Capital Markets, LQW announced today that director Craig Graham has agreed to provide additional management expertise by joining the Company as Chief Operating Officer. Mr. Graham has demonstrated significant retail, restructuring success throughout his career as well as serving as LQW's interim President and CEO in 2009. Mr. Graham will focus on streamlining operations and generating liquidity through inventory management during this difficult time for the Company.

Chris Rath, the Company's former Chief Financial Officer will serve in the capacity of Interim Vice President Finance replacing David Becker Interim Chief Financial Officer and further to cost reduction initiatives announced last month Juan Zepeda will be stepping down as Vice President Operations. The board of directors is currently considering candidates whom it may ask to act as interim CFO. Mr. Becker remains a director of LQW and will continue to provide ongoing support to the Company on a consulting basis.

Seth Marks, President and CEO will focus on improving the stores' product offering on a full-time basis, concentrating on evaluating and executing on compelling product opportunities to deliver the proper deal flow that LQW requires to succeed.

"Our experience has demonstrated that when we have the right deals and correct inventory levels flowing to the stores that this business absolutely works", said Marks. The management of the Company has implemented certain changes to achieve immediate as well as long term cost reductions and gross margin increases and continues to consider ways to achieve better financial and operational results, although there is no assurance that the cost reduction strategies and other streamlining measures being implemented by the Company will achieve the desired results in sufficient time to allow the Company to achieve profitability.

"We would like to express our appreciation to David Becker and Juan Zepeda for their commitment to LQW", said William Wolf, Chairman of Liquidation World. "During this period under Dave Becker's guidance, we cut expenses, sold off $6 million of old inventory, resolved significant payables issues and began the strategic alternatives initiative. Although the Company continues to have very significant challenges to resolve, we are confident that the actions taken over the past several months, including the changes announced today, are consistent with our stated objectives," Mr. Wolf said.

About Liquidation World

Liquidation World is based in Brantford, Ontario and operates 92 stores in Canada. Liquidation World opened its first store in Calgary, Alberta in 1986 and today, with more than 1,400 employees, is Canada's largest operator of closeout retail stores.

Forward-Looking Statements

This press release may contain forward-looking statements relating to Liquidation World. These statements are not guarantees of future performance or events and involve risks and uncertainties that are difficult to predict, and/or are beyond Liquidation World's control. A number of important factors could cause actual outcomes and results to differ materially from those expressed in these forward-looking statements. Consequently, readers should not place any undue reliance on such forward-looking statements. Liquidation World disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Information

  • Liquidation World Inc.
    Seth Marks
    President & CEO
    519-720-2552
    866-237-3778 (FAX)
    sethm@lwstores.com

    Liquidation World Inc.
    Chris Rath
    Interim VP Finance
    519-758-8878
    866-237-3778 (FAX)
    chrisr@lwstores.com