Catching Up With: Regis Rolland

mike lewis

• August 21 2009
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APO Snowboards was forced to seek Chapter 11 bankruptcy protection in early July, but founder Regis Rolland says that this is far from the death knell for his company. We caught up with Rolland to find out what caused this predicament and his plans for successfully navigating the bankruptcy waters.

Can you explain some of the factors that caused APO to seek Chapter 11 protection?

I think everybody has noticed that the financial crisis has hit companies badly and it has unfortunately hit my company at the wrong time. Indeed, in the past five years, we have been investing in costly innovative projects such as our patented bindings, our Dual Entry System, and more recently our new ski range. 
The returns have been decent, but as an independent brand, we do not have the financial clout to support such a large investment without the backing of a strong financial group or the support of our banks. When getting bank credit was easy, this was not a problem, but the Financial crisis has changed all this. Without bank support, we needed more time to build up our business and generate enough cash to self finance.
The paradox is that our orders for the coming winter are really good! But good orders need financing to be fulfilled, so our cash flow needs are high, especially considering we only sell winter products (and therefore do not generate any cash during the summer, when we need to finance production).
If you shake all of these ingredients together, you get the situation where our debt has become too heavy to support and we have had to go into Chapter 11. Chapter 11, or administration protection, is not as bad as it sounds, since it enables you to block and spread your debts. It is a process that helps you recover from a bad situation, in order to build your company back up.

What does this mean for your company going forward?

As I said above, and in an effort to reassure our customers, I repeat that we are not dead!! 
Thanks to the support of our factories, we have been able to launch the production for the 2009/10 winter, and new APO line for year 2010/11 is ready to be launched.

A partenaria (co-development) for our patented Dual Entry System bindings is also on the way to [being completed].

How are orders looking for next season?

Our brand recognition, sell through results for 08/09, and pre-orders for 09/10 give us hope, but we know we are not going to have an easy time

What measures are you taking to emerge from Chapter 11?

Our plan for the coming year is to downsize the company a little, reduce costs, reduce communication and promotion, reorganise, rethink everything to become more cost effective and try to get back to a stable situation.

What message would you like to share with your partners/retailers?

I repeat what I said above - we are not dead. We are currently looking for a private investor to make the company stronger. and more than ever, we need everybody’s support. We have set up an association, www.SUPPORT-APO.com, in order to get help from our fan club. The association Web site should be online in early September.We are talking here about donations to help the company adjust and will have a direct link from our website of course (www.apo-snow.com)