WEST LEBANON — The Eastern Mountain Sports in Powerhouse Mall is, at present, not on the list of stores slated to close following the parent company’s Chapter 11 bankruptcy filing last week.

Eastern Mountain Sports and Bob’s Stores, which are owned by GoDigital Media Group, filed jointly for Chapter 11 bankruptcy on June 18 in the United States Bankruptcy Court for the District of Delaware.

“We are disappointed that, despite making several significant — and swift — adjustments to business operations and outlining a clear strategy to rebuild our valuable brands, we did not have access to the resources necessary to avoid bankruptcy protection,” Dave Barton, president of Eastern Mountain Sports and Bob’s Stores, said in a news release.

“This restructuring remains the only viable path forward for Bob’s Stores and Eastern Mountain Sports, enabling us to address our financial challenges, continue to make strategic and operational adjustments and focus on growth,” Barton added.

Eastern Mountain Sports, which sells outdoor apparel and gear, has faced strong competition from larger chains. In addition, many retailers have struggled to manage operating costs amid the shift to online shopping. In the last five years, JCPenney, Olympia Sports and Kmart have closed their West Lebanon locations amid financial struggles. Sears, which filed for Chapter 11 two years ago, closed its West Lebanon store in 2017.

Employees at the West Lebanon EMS store on Tuesday said they could not speak about the bankruptcy case and directed all questions to GoDigital Media Group.

“While GoDigital Media Group has invested significant resources to support, rightsize, and restructure operations and work toward revitalizing the business, we faced substantial financial challenges — a turn in the market beginning in April 2023, rising interest rates and inflation — all of which impacted company performance,” a company spokesman said in a Tuesday email. “This restructure is a necessary step to enable a healthy business that can continue to serve its communities and grow in years to come.”

The company has more than 20 EMS store locations, including four in New Hampshire, one in Burlington, and two in Maine. Six EMS locations, including in Manchester, have either closed recently or announced closures.

“To date, all remaining Bob’s and Eastern Mountain Sports stores remain open,” the company said.

EMS stores, including in West Lebanon, are currently holding a “blowout sale,” with discounts of 20% or more on all store items. In the Tuesday email, the company spokesman did not address a question asking if the sale was related to the bankruptcy.

Bob’s and EMS have a history of financial challenges. Their former parent company, Vestis Retail Group, of Meriden, Conn., filed for Chapter 11 bankruptcy in 2016 — and sold the company a year later to U.K. company Sports Direct, now known as Frasers Group. GoDigital, a multinational conglomerate, purchased the company in 2022.

Last year, EMS and Bob’s generated $131.9 million in net revenue, according the court filings.

PNC Bank, the company’s primary lender, alleges being owed nearly $30 million, while the company also owes nearly $27 million in unpaid rent and other operating debt, Barton said in a court filing last week.

On March 29, PNC declared a default under their loan agreement with the company and took control of the chains’ cash and receivables, Barton said in his filing. PNC stopped funding the company’s operations on June 12 after the retailers and the bank were unable to reach agreement on a restructuring plan.

The company asked the court’s permission to use its cash collateral to pay $935,000 in unpaid wage obligations, Barton said. The company did not have sufficient cash otherwise to cover payroll, rents, utilities, taxes and other operating expenses, he added.

To reduce operating expenses, the company plans to vacate its headquarters and distribution center in Connecticut, and to operate either remotely or from their larger stores, Barton said.

Patrick Adrian can be reached padrian@vnews.com or 603-727-3216.