Pomare Ltd., the parent of Hilo Hattie, lost $970,190 in June to increase its post-bankruptcy losses to $7 million.

The company's loss for the 30-day period ended July 4 was about $305,000 more than the loss recorded during a similar period in May.

Total operating expenses for the 30-day period were $1.62 million, while cumulative post-petition operating expenses were $16.1 million.

Despite the growing losses, Hilo Hattie may well be on its way to emerging from bankruptcy after Judge Robert Faris cleared the way last month for the company to proceed with its reorganization plan.

Faris approved up to $1 million in financing for Hilo Hattie to purchase more inventory, while denying a motion to appoint a trustee and withdrawing another motion to liquidate the company.

Donald “;Bum Sik”; Kang, the new chief executive of Hilo Hattie, purchased assets of the company in June from former CEO Ted Nelson's company, TOC Inc.

Kang was on the brink of canceling a concession agreement with Maui Divers Jewelry, which put in a bid to buy Hilo Hattie. But after renegotiating, Maui Divers withdrew its bid last month and signed a new concession agreement.

Hilo Hattie's outstanding debts to secured creditors include $168,540 to First Hawaiian Bank for a capital lease loan, while additional attorneys' fees are under dispute.

Hilo Hattie is also delinquent on $201,170 in rent for its store at Ala Moana Center as well as $212,393 owed to Brett Hill Construction for escalator work at Royal Hawaiian Center. The company's Chapter 11 expenses now amount to $111,728.

In its reorganization plan, Hilo Hattie says it expects sales to stabilize and increase beginning in fiscal year 2011.

A court hearing on Hilo Hattie's motion to assume store leases is scheduled for Aug. 19. Hilo Hattie has another month to solicit support for the new reorganization plan, which is scheduled for confirmation on Sept. 14.