By Adriano Marchese
LXRandCo warned that it could face liquidity issues in the fourth quarter as tightening consumer-spending trends weigh on revenue.
The Canadian retailer of pre-owned luxury handbags and accessories said Monday that economic headwinds have put pressure on consumers’ discretionary spending, which have led to lower-than-expected revenue in the third quarter.
Due to the lower revenue, LXRandCo said it may be in breach of certain banking covenants that would result in liquidity issues in its fourth quarter.
LXRandCo is in discussions with its bank lenders regarding possible alternatives to address the financial situation. The company cautioned there could be no assurance of any particular outcome.
In early August, the company reported that in the first half of the year, revenue fell nearly 24% to 7.4 million Canadian dollars ($5.5 million). LXRandCo said the decline compared with a relatively strong first half in the year before.
Write to Adriano Marchese at adriano.marchese@wsj.com
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