GNC Holdings, the parent company of nutrition supplement chain GNC, is filing for bankruptcy protection in the United States and has plans to close a quarter of its stores, CNN and Bloomberg among many others have reported on June 24.
The 85-year-old company is reportedly nearly US$1 billion in debt and has faced declining sales at its physical stores in North America since before the pandemic.
It plans to close as many as 1,200 of its 5,800 retail stores there.
GNC Singapore not affected
However, GNC in Singapore has issued a statement saying the bankruptcy protection filing in the U.S. will leave local operations unscathed.The June 24 statement by GNC said ONI Global Pte Ltd is the sole franchisee for GNC in Singapore, Malaysia, the Philippines and Taiwan.
The statement said GNC franchisee operations will continue expanding in countries under ONI Global Group.
"ONI Global Group is financially robust with a highly successful and self-funding operation," the statement read.
GNC said that stay-at-home orders during the Covid-19 pandemic prevented the company from accomplishing its refinancing plans due to the abrupt "dramatic negative impact" on its business.
But GNC aims to emerge from bankruptcy in the fall after securing US$130 million in fresh financing from its largest vendor, vitamin supplier IVC.
Around 30 per cent of its stores in the U.S. and Canada were forced to temporarily close because of the pandemic.
In its first-quarter earnings report released in May, losses accelerated to US$200 million.
This figure is way more than the US$15 million it lost during the same time period in 2019 because of the store closures.
Top photo via Zhangxin Zheng