In view of SHLD's unexpected disclosure in Tuesday's annual report, the company's bondholders and creditors are questioning how long the company, at one time the world's largest retailer, can stay in business. Chad Brand, president of Peridot Capital Management, a SHLD bondholder, told Reuters on Wednesday that although he doesn't think the new disclosure means a definite bankruptcy filing this year, “it does seem to signal that the next 12 months are even more crucial than has been the case in recent years, as their margin of error is getting slim.”

HOFFMAN ESTATES, IL—Shares of Sears Holdings (SHLD) slumped Wednesday following the beleaguered retailer's after-hours release of its annual report, which indicated “substantial doubt” about its ability to continue as a going concern. The Wall Street Journal and Bloomberg Business reported that Sears shares were off by as much as 15% as of mid-morning Wednesday, after gaining more than 60% since early February.

“We cannot predict, with certainty, the outcome of our actions to generate liquidity, including the availability of additional debt financing, or whether such actions would generate the expected liquidity as currently planned,” according to the SHLD annual report. The retailer, which last month posted its seventh consecutive annual loss—$2.22 billion for the year that ended Jan. 28—says that if operating losses continue, “we may not be able to access additional funds under our amended Domestic Credit Agreement.”

That would mean securing additional sources of funds, “which may or may not be available to us,” according to the annual report. For one thing, there are limits on further asset sales; SHLD spun off a large chunk of its owned real estate into a REIT two years ago, and recently sold its Craftsman tool brand to Stanley Black & Decker.

Earlier this month, CEO Eddie Lampert sounded a more positive note in a letter to employees. “As many of you know, 2016 proved to be another challenging year for most 'bricks and mortar' retailers,” he wrote. “Our company was not immune to these headwinds. Regardless, as a result of the strategic actions we have taken, we delivered adjusted EBITDA improvements in the fourth quarter, increased our financial flexibility and are moving forward with positive momentum.”

In view of SHLD's unexpected disclosure in Tuesday's annual report, the company's bondholders and creditors are questioning how long the company, at one time the world's largest retailer, can stay in business. Chad Brand, president of Peridot Capital Management, a SHLD bondholder, told Reuters on Wednesday that although he doesn't think the new disclosure means a definite bankruptcy filing this year, “it does seem to signal that the next 12 months are even more crucial than has been the case in recent years, as their margin of error is getting slim.”