Party City Holdco (PRTY) - Get Report soared Friday after the country’s largest party-goods company said that a possible agreement with bondholders would reduce the company's debt by 25% and raise $100 million in capital.
Shares of Party City, based in Elmsford, N.Y., were climbing 19% to $1.69.
Party City, which has been slammed by the coronavirus pandemic, first announced last month that it signed an agreement with its bondholder to restructure its debt.
The agreement would be with about 54% of holders of Party City's 6.125% senior notes due 2023 and 6.625% senior notes due 2026. A quarter of the company's debt would be about $450 million.
In addition, the company reported first-quarter net losses of $541.5 million, or $5.80 per share, compared with a loss of $30.2 million, or 32 cents per share, a year go. Adjusted losses came to 28 cents per share, while the FactSet consensus forecast called for a loss of 22 cents.
Revenue totaled $414 million, down 19.3% from $513.1 million last year. FactSet was calling for revenue of $445 million. Same-store sales fell 17.1%, wider than FactSet's call for a 7.3% decline.
Party City closed all its stores on March 18 due to the coronavirus pandemic. The company began to reopen stores on May 1 in accordance with state and local health ordinances, and as of today, has re-opened over 85% of its stores.
During the remainder of 2020, Party City said it plans to close about 21 stores, open two new stores, with the remaining 10 planned new store openings likely to shift into 2021.
As a result of the continued disruption and uncertainty caused by the coronavirus outbreak, Party City said it wasn't providing any additional financial outlook information at this time for fiscal 2020.