Top 40 supplier American Apparel (asi/35297) announced its total second-quarter revenues fell 17% to $134.4 million, while also warning in a filing yesterday that its weakened financial position raises “substantial doubt” that the company may be able to stay in business. The company’s overall net loss widened to $19.4 million, or 11 cents a share, and gross profit for the second quarter decreased 25.3% to $61.5 million. While American Apparel did avoid pending default by reaching a new $90 million credit agreement, the company hinted that bankruptcy is becoming more likely.  

“We incurred losses from operations and negative cash flows from operating activities for the six months ended June 30, 2015, and such losses might continue for the remainder of 2015,” American Apparel said. “Based upon the trends occurring in our operations since June 30, 2015, and through the date of this release, together with our current expectations and projections for the next four fiscal quarters, we believe that we may not have sufficient liquidity necessary to sustain operations for the next twelve months.”

Filings show the company has more than $200 million in long-term debt, and must make a $13.9 million bond payment in October. The credit agreement was necessary because as of August 11 the Los Angeles-based retailer said it had just $11.2 million in cash. Shares of American Apparel stock [NYSE: APP] have plummeted by 87% this year and were trading at 14 cents at market’s close yesterday. In pre-market trading this morning, American Apparel’s stock price had fallen even further to 10 cents per share.

Consolidated Q2 revenues in the firm’s wholesale division – which includes promotional products sales – slipped to $48 million, down from $54 million a year earlier. Quarterly retail sales plunged to $74 million, off from $94 million in Q2 of 2014, while online revenues dipped to $11.5 million.

American Apparel ranks number 14 on Counselor’s Top 40 supplier list, after it reported 2014 North American ad specialties sales of $105.2 million, a 6% increase over the prior year.