CCTV Transcripts

CCTV Script 05/05/20

— This is the script of CNBC's news report for China's CCTV on May 5, 2020, Tuesday.

After filing for bankruptcy protection, J. Crew became a hot topic on search engine Google and social media twitter. In the United States, J. Crew was once a star brand in the retail industry, favored by white-collar workers.

It was also noticed by former first lady Michaelle Obama. However, its bankruptcy is not a surprise to the capital market.

So far, J. Crew has lost money for six consecutive years.

It closed 500 stores in March because of COVID-19, The company has laid off tens of thousands of employees and decided not to pay April's rent due to a loss of revenue. It estimated the cost of closing stores affected by the outbreak at about $900 million. The company had hoped to raise money by taking its spin-off brand Madewell public, but the outbreak delayed that plan and forced J. Crew to file for bankruptcy protection. J. Crew had $2.5 billion in revenue and 14,500 employees in its last fiscal year, according to Forbes.

J. Crew is the first major U.S. retailer to file for bankruptcy protection under the outbreak, but probably not the last, the outbreak has put pressure on the world's leading clothing retailers.

H&M's share has been down nearly 40 per cent so far this year.

In the United States, at least two other large retailers, JCPenney and Neiman Marcus, are reported to be on the verge of bankruptcy. Sarah Wyeth, an analyst at S&P global ratings, estimates that retailers and restaurants with speculative-grade debt have a default rate of 20%. Filing for bankruptcy protection does not mean that businesses will shut down entirely. Gordon Brothers estimates that as many as 25,000 U.S. stores will remain closed permanently this year. By the end of 2021, Green Street Advisors expects more than half of U.S. department stores to close

DANA TELSEY  

TELSEY ADVISORY GROUP  

CEO&CHIEF RESEARCH OFFICER 

The longer the stores stay closed, the greater the mismatched inventory, the greater level of mark down we are gonna go forward, and these stores whenever they reopen, are reopen into a time period with this greater unemployment which basically impact the ability to sell goods at full price and impact demand, there is quite a few others can be down in line

On the other hand, the epidemic also acts as a catalyst, exacerbating the gap between the best and the laggards on the retail track. We saw that, during outbreak, some retailers that have already developed online channels,

Performed very good, for example, Amazon and Walmart. But some believes online channels are important though, they just account for 30% of sales in America. Therefore, during and after the outbreak, omnichannel retail still needs to be attached great importance. Moreover, changes in consumer habits brought by the outbreak will persist for some time, In the post-epidemic period, the retail sector needs to focus on data and attract traffic in innovative ways while ensuring safety.

We will also continue to pay attention to the development of the retail industry