Retail News Breaks Archives
Top and bottom lines sag at Sears Holdings
August 18th, 2011
HOFFMAN ESTATES, Ill. – Both sales and profits fell at Sears Holdings Corp. during the second quarter as fewer stores in operation, weaker same-store sales and lower gross margins took their toll.
The company’s net loss ballooned 274% to $146 million, or $1.37 per diluted share, while adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell 69% to $79 million.
Revenues dipped 1.2% to $10.33 billion, reflecting store closures, flat comparable-store sales at Kmart and a 1.2% decline in comp-store sales at Sears domestic outlets.
“We are not satisfied with our results and are taking actions to turn around our performance in a challenging economic environment,” said president and chief executive officer Lou D’Ambrosio in a statement.
“While we improved our revenue trend, including growing our online business by over 30%, we had lower gross margins. The margin decline was due to markdowns taken to clear seasonal inventory and promotional activity,” D’Ambrosio explained.
The company has announced that it will close 29 locations, including 10 Kmarts, three full-line Sears stores, 12 Hardware & Appliance stores, two Sears Auto Centers and two The Great Indoors units.
In addition, 14 Sears Grand locations are slated to be converted to the Kmart banner, and seven product repair centers will be shuttered.